Statute Details
- Title: Income Tax (Exemption of Foreign Income) (No. 3) Order 2007
- Act Code: ITA1947-S368-2007
- Type: Subsidiary Legislation (SL)
- Authorising Act: Income Tax Act (Chapter 134)
- Authorising Provision: Section 13(12) of the Income Tax Act
- Enacting Date / Made Date: 6 July 2007
- Commencement Date: Not stated in the extract (commencement typically follows the making/notification, but practitioners should confirm in the official publication)
- Legislative Instrument Number: SL 368/2007
- Current Version Status: Current version as at 27 Mar 2026 (per the legislation portal status)
- Key Provisions: Section 1 (Citation); Section 2 (Exemption)
- Beneficiary (as specified): United International Securities Trading (Pte) Ltd
- Income Type: Dividends received in Singapore from specified foreign subsidiaries
- Foreign Sources (as specified): Indonesia, Philippines, Australia, and Hong Kong
- Conditions: Subject to terms and conditions in a letter of approval dated 5 January 2007 addressed to the company
What Is This Legislation About?
The Income Tax (Exemption of Foreign Income) (No. 3) Order 2007 is a targeted tax exemption instrument made under Singapore’s Income Tax Act. In plain terms, it grants a specific company an exemption from Singapore tax on certain foreign-sourced dividends that the company receives in Singapore.
Unlike broad-based tax regimes that apply to many taxpayers, this Order is narrow in scope. It does not create a general rule for all taxpayers; instead, it confers an exemption on United International Securities Trading (Pte) Ltd in relation to dividends received from its subsidiaries located outside Singapore—specifically in Indonesia, Philippines, Australia, and Hong Kong.
The Order is also important because it illustrates how Singapore uses subsidiary legislation to implement tax policy outcomes through ministerial discretion and approval-based conditions. The exemption is expressly “subject to the terms and conditions specified” in a separate letter of approval dated 5 January 2007. For practitioners, this means the exemption is not purely statutory in isolation; it is tied to administrative approval terms that must be reviewed alongside the Order.
What Are the Key Provisions?
Section 1 (Citation) provides the short title of the instrument: the “Income Tax (Exemption of Foreign Income) (No. 3) Order 2007”. This is a standard provision used to identify the Order for reference in legal and administrative contexts.
Section 2 (Exemption) is the operative provision. It states that United International Securities Trading (Pte) Ltd is granted an exemption from tax on dividends received in Singapore from specified foreign subsidiaries. The subsidiaries named in the extract are:
- Indonesia: P.T. Astra International Tbk
- Philippines: Ayala Corporation
- Australia: Zinifex Ltd
- Hong Kong: Hang Lung Properties Ltd
In practical terms, the Order targets the Singapore tax treatment of dividends that are paid by these foreign entities to the Singapore company. The exemption is framed as an exemption “from tax on the dividends received in Singapore”, meaning the relevant tax charge is the Singapore tax that would otherwise apply when the dividends are received or deemed received in Singapore.
Crucially, the exemption is not unconditional. Section 2 makes the exemption “subject to the terms and conditions specified in the letter of approval dated 5th January 2007 addressed to the company.” This introduces a two-layer compliance structure:
- Layer 1: The statutory instrument identifies the company and the relevant dividends/sources.
- Layer 2: The administrative approval letter sets additional conditions that govern whether the exemption applies and how it must be maintained.
For lawyers advising on eligibility, ongoing compliance, or disputes, the letter of approval is therefore not optional background—it is a central document. If conditions in the approval letter are breached (for example, conditions relating to corporate structure, shareholding, holding period, substance, reporting, or other compliance obligations), the exemption could be withdrawn or denied for relevant periods, even though the Order itself remains in force.
Finally, the Order includes the making clause and signature block. It states that it is made by the Minister for Finance in exercise of powers conferred by section 13(12) of the Income Tax Act, and it records the date “6th day of July 2007” and the signatory (TEO MING KIAN, Permanent Secretary, Ministry of Finance). This matters for practitioners because it confirms the legal basis for the exemption and the authority under which it was granted.
How Is This Legislation Structured?
This Order is extremely short and consists of a small number of provisions. Based on the extract, it is structured as follows:
- Enacting formula: Identifies the enabling power under section 13(12) of the Income Tax Act and states that the Minister for Finance makes the Order.
- Section 1 (Citation): Provides the short title.
- Section 2 (Exemption): Grants the exemption and specifies the company, the dividend income, the foreign subsidiaries, and the condition that the exemption is subject to the approval letter.
- Making details: Date and signature/authority information.
There are no “Parts” or detailed schedules in the extract. The instrument’s brevity reflects its function as a bespoke exemption order rather than a comprehensive tax code.
Who Does This Legislation Apply To?
The Order applies to United International Securities Trading (Pte) Ltd—and only to that company—because the exemption is granted by name. It does not establish a general category of taxpayers eligible for exemption; eligibility is determined by the specific identification of the beneficiary in the Order.
In terms of income scope, it applies to dividends received in Singapore from the specified foreign subsidiaries. Therefore, even for the named company, the exemption is limited to dividends from the listed entities (P.T. Astra International Tbk, Ayala Corporation, Zinifex Ltd, and Hang Lung Properties Ltd). Dividends from other subsidiaries or other foreign sources would not automatically fall within the exemption unless covered by a different order or a different approval arrangement.
Why Is This Legislation Important?
This Order is important for practitioners because it demonstrates how Singapore’s tax system can provide targeted relief for cross-border corporate investment structures. Dividends received in Singapore from foreign subsidiaries can attract Singapore tax consequences. By granting an exemption, the Order reduces the tax burden on the specified company for those dividends, supporting the commercial viability of the group’s international holdings.
From an advisory perspective, the key legal significance lies in the interaction between the statutory exemption and the approval letter. The Order itself is clear that the exemption is “subject to the terms and conditions” in the approval letter dated 5 January 2007. Lawyers should therefore treat the approval letter as part of the legal framework governing the exemption. In practice, this can affect:
- Eligibility and scope: whether the dividends qualify and whether the foreign subsidiaries and shareholding arrangements match what was approved.
- Ongoing compliance: whether reporting, corporate actions, or other conditions must be met to preserve the exemption.
- Risk management: how to respond if conditions are breached or if the corporate group undergoes restructuring.
Finally, the Order is a useful example of how subsidiary legislation can be used to implement tax policy through ministerial discretion under the Income Tax Act. For tax disputes or audits, the existence of such an order can be decisive evidence of the intended tax treatment—provided the approval conditions are satisfied.
Related Legislation
- Income Tax Act (Chapter 134) — in particular, section 13(12) (the enabling provision for this Order)
- Income Tax (Exemption of Foreign Income) (No. 3) Order 2007 — SL 368/2007 (this instrument)
- Legislation timeline / versions — to confirm the “current version as at 27 Mar 2026” and whether any amendments affect the operative provisions
Source Documents
This article provides an overview of the Income Tax (Exemption of Foreign Income) (No. 3) Order 2007 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.