Statute Details
- Title: Income Tax (CapitaLand Commercial Trust, etc. — Section 13(12) Exemption) Order 2022
- Act Code: ITA1947-S613-2022
- Legislation Type: Subsidiary Legislation (SL)
- Enacting Authority: Minister for Finance (pursuant to section 13(12) of the Income Tax Act 1947)
- SL Citation: S 613/2022
- Date Made: 23 July 2022
- Status: Current version as at 27 Mar 2026 (per the legislation portal)
- Key Provision: Exemption from tax for specified distribution/dividend/interest income received in Singapore
- Key Trigger Date: On or after 3 November 2020
- Conditions Reference: Letter of approval dated 11 June 2020 addressed to EY Corporate Advisors Pte. Ltd.
What Is This Legislation About?
The Income Tax (CapitaLand Commercial Trust, etc. — Section 13(12) Exemption) Order 2022 (“the Order”) is a targeted tax exemption instrument made under the Income Tax Act 1947 (“ITA”). In plain terms, it removes (exempts) certain categories of income from tax when they are received in Singapore by specified Singapore companies acting in connection with particular real estate investment trust (REIT) and related entities.
The Order is not a general tax reform measure. Instead, it is a narrow, transaction- and entity-specific exemption. It addresses income flows that arise when Singapore-based parties receive distributions, dividends, and interest from specified counterparties located outside Singapore (Malaysia, Luxembourg, and the Netherlands). The exemption is designed to prevent tax on those incoming income streams, subject to conditions set out in an approval letter.
Practically, the Order sits within Singapore’s broader approach to REIT and cross-border investment structures. It reflects the policy that, where certain investment vehicles and arrangements meet specified criteria, the incoming income should not be taxed in Singapore—at least for the relevant period and subject to the relevant conditions.
What Are the Key Provisions?
1. The exemption mechanism (section 2 of the Order)
The operative provision is Exemption, which provides that certain income received in Singapore is exempt from tax. The exemption is framed as follows: the income must be (i) received in Singapore, (ii) of a specified type (distribution income, dividend income, or interest income), (iii) received by specified Singapore entities, (iv) from specified non-Singapore counterparties, and (v) received on or after 3 November 2020.
2. HSBC Institutional Trust Services (Singapore) Limited as trustee of CapitaLand Commercial Trust
Under paragraph 2(1), distribution income received in Singapore by HSBC Institutional Trust Services (Singapore) Limited (a Singapore-incorporated company) in its capacity as trustee of CapitaLand Commercial Trust is exempt from tax. The distribution income must be received from Sentral REIT (formerly known as MRCB‑Quill REIT), which is described as a real estate investment trust listed in Malaysia.
Importantly, the exemption applies only to distributions received on or after 3 November 2020. This “on or after” date operates as a temporal limitation: distributions prior to that date would not fall within the exemption as drafted.
3. CCT Galaxy One Pte. Ltd. — dividend and interest from a Luxembourg counterparty
Under paragraph 2(2), dividend income and interest income received in Singapore by CCT Galaxy One Pte. Ltd. (a Singapore-incorporated company) from Gallileo Property S.a.r.l (a company incorporated in Luxembourg) are exempt from tax, again only if received on or after 3 November 2020.
This provision is significant because it covers both dividends and interest, indicating that the underlying arrangement likely involves equity and debt-like components (or instruments that generate both types of returns). For practitioners, the inclusion of both categories reduces the risk that one component of the return stream would be taxed while another is exempt.
4. CCT Mercury One Pte. Ltd. — dividend and interest from Netherlands counterparties
Under paragraph 2(3), dividend income and interest income received in Singapore by CCT Mercury One Pte. Ltd. (a Singapore-incorporated company) from MAC Property Company B.V. and MAC Car Park Company B.V. (companies incorporated in the Netherlands) are exempt from tax, again for income received on or after 3 November 2020.
As with paragraph 2(2), the exemption covers both dividends and interest. The presence of two Netherlands counterparties suggests that the structure may involve multiple property-holding entities (for example, property and car park assets), each generating returns that flow to the Singapore entity.
5. Conditions precedent: approval letter dated 11 June 2020
The exemptions in paragraphs 2(1) to (3) are subject to the conditions specified in the letter of approval dated 11 June 2020 addressed to EY Corporate Advisors Pte. Ltd.
This is a critical compliance point. While the Order itself does not reproduce the conditions, it incorporates them by reference. For legal and tax practitioners, this means that the exemption’s availability is not purely automatic upon meeting the factual criteria (recipient, payer, income type, and date). Instead, the exemption is also contingent on satisfying the conditions in the approval letter.
Accordingly, counsel should treat the approval letter as an essential document for advising on eligibility, ongoing compliance, and potential consequences of breach. In practice, conditions may relate to the structure of the arrangement, the nature of the income, reporting obligations, anti-avoidance safeguards, or requirements to maintain certain corporate or trust characteristics.
How Is This Legislation Structured?
The Order is structured in a straightforward, two-part format:
(1) Citation — Section 1 identifies the Order by name: “Income Tax (CapitaLand Commercial Trust, etc. — Section 13(12) Exemption) Order 2022”.
(2) Exemption — Section 2 sets out the substantive exemption rules. It contains four sub-paragraphs: paragraphs (1) to (3) specify the exempt income streams and the entities involved, while paragraph (4) provides that the exemptions are subject to conditions in the referenced approval letter.
There are no additional parts, schedules, or detailed procedural provisions in the extract provided. The operative content is therefore concentrated in section 2.
Who Does This Legislation Apply To?
The Order applies to specific Singapore recipients and specific non-Singapore payers, rather than to a broad class of taxpayers. The exempt recipients are:
- HSBC Institutional Trust Services (Singapore) Limited, acting as trustee of CapitaLand Commercial Trust;
- CCT Galaxy One Pte. Ltd.;
- CCT Mercury One Pte. Ltd..
The exempt income must be received in Singapore from the specified counterparties:
- Sentral REIT (Malaysia) for distribution income (paragraph 2(1));
- Gallileo Property S.a.r.l (Luxembourg) for dividend and interest income (paragraph 2(2));
- MAC Property Company B.V. and MAC Car Park Company B.V. (Netherlands) for dividend and interest income (paragraph 2(3)).
In terms of temporal scope, the exemption applies to income received on or after 3 November 2020. This means that even if the same entities and counterparties are involved, income received before that date would not be covered by the exemption as drafted.
Finally, the Order’s applicability is conditioned by the approval letter dated 11 June 2020. Even where the factual criteria are met, failure to satisfy the conditions could jeopardise the exemption.
Why Is This Legislation Important?
This Order is important because it provides legal certainty for a particular set of cross-border income flows connected to CapitaLand Commercial Trust and related entities. For practitioners, the value of an exemption order lies in its ability to override or neutralise the default tax treatment under the ITA for the specified income streams—provided the statutory conditions are satisfied.
From a compliance and advisory perspective, the most consequential feature is the incorporation by reference of conditions in the approval letter. Many tax disputes do not turn solely on whether income is of the right type; they turn on whether the taxpayer complied with structural, documentation, or ongoing operational requirements. Here, the Order explicitly makes the exemption dependent on those conditions, so counsel should obtain and review the approval letter and ensure that the client’s arrangements and reporting align with it.
In addition, the Order’s specificity (named entities and named counterparties) suggests that it is designed for a particular arrangement and may not be easily extended to other structures. Practitioners should therefore be cautious about assuming that similar income streams in related but not identical structures will be exempt. If a transaction differs materially—different counterparties, different instruments, or different timing—an exemption order may not apply, and separate advice or applications may be required.
Finally, the Order illustrates how Singapore uses subsidiary legislation to implement targeted tax policy outcomes under the ITA. For lawyers working on REIT structures, cross-border financing, and investment holding arrangements, understanding how section 13(12) exemptions are implemented in practice is essential for risk management and for structuring transactions to achieve intended tax outcomes.
Related Legislation
- Income Tax Act 1947 (in particular section 13(12), which empowers the Minister to grant exemptions)
- Income Tax Act 1947 (general provisions governing chargeability and exemptions)
Source Documents
This article provides an overview of the Income Tax (CapitaLand Commercial Trust, etc. — Section 13(12) Exemption) Order 2022 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.