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 on 6 July 2007
- Commencement: Not stated in the extract (commencement typically follows the making/citation in the published SL)
- Legislative Instrument Number: SL 368/2007
- Status: Current version as at 27 Mar 2026 (per the legislation portal)
- Key Provisions (in extract): Section 1 (Citation); Section 2 (Exemption)
- Beneficiary (as stated): United International Securities Trading (Pte) Ltd
- Income covered (as stated): Dividends received in Singapore from specified foreign subsidiaries
- Foreign jurisdictions / payers (as stated): Indonesia, Philippines, Australia, Hong Kong
- Approval condition reference: 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 order made under the Income Tax Act. In plain terms, it grants a specific company an exemption from Singapore income tax on certain dividends it receives in Singapore from its foreign subsidiaries.
Although the title refers to “foreign income”, the mechanism here is not a general rule for all taxpayers. Instead, the Order operates as a bespoke exemption for United International Securities Trading (Pte) Ltd. The dividends in question are those paid by specified foreign companies—located in Indonesia, the Philippines, Australia and Hong Kong—into Singapore, where the recipient company receives them.
Practitioners should view this Order as part of Singapore’s broader framework for managing the tax treatment of cross-border corporate income. It reflects how the Minister for Finance may, under the Income Tax Act, grant exemptions that are subject to conditions set out in an approval letter. The legal effect is therefore both substantive (tax relief) and conditional (compliance with the terms of approval).
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 standard drafting and is primarily relevant for referencing the Order in submissions, correspondence, and legal documents.
Section 2 (Exemption) is the operative provision. It states that United International Securities Trading (Pte) Ltd is granted an exemption from tax on the dividends received in Singapore from its subsidiaries in the following jurisdictions and entities:
- Indonesia: P.T. Astra International Tbk
- Philippines: Ayala Corporation
- Australia: Zinifex Ltd
- Hong Kong: Hang Lung Properties Ltd
The exemption is not framed as a blanket exemption for all foreign dividends. It is limited to dividends received in Singapore from the specified subsidiaries. This matters for tax planning and compliance: if dividends are received from other foreign subsidiaries (even if in the same jurisdictions), the exemption would not automatically apply unless covered by another order or a different exemption regime.
Section 2 also makes the exemption subject to the terms and conditions specified in the letter of approval dated 5 January 2007 addressed to the company. This is a critical legal feature. In practice, the approval letter typically sets out conditions such as eligibility requirements, documentation obligations, and possibly ongoing compliance or reporting. While the extract does not reproduce those terms, the statutory language makes clear that the exemption is conditional and that the conditions in the approval letter are legally relevant.
Finally, the Order includes the formal “Made” date and signature block: it was made on 6 July 2007 by the Permanent Secretary, Ministry of Finance, Singapore (TEO MING KIAN), acting under the powers conferred by section 13(12) of the Income Tax Act. This confirms the instrument’s legal authority and the governmental process by which the exemption was granted.
How Is This Legislation Structured?
This Order is extremely concise and consists of:
- Enacting formula (identifying the enabling power): the Minister for Finance makes the Order in exercise of powers under section 13(12) of the Income Tax Act.
- Section 1 (Citation): the short title.
- Section 2 (Exemption): the substantive exemption and its scope, including the named company, the specified foreign subsidiaries, the type of income (dividends), the location of receipt (dividends received in Singapore), and the condition that it is subject to the approval letter.
There are no Parts, schedules, or detailed procedural provisions in the extract. The practical “structure” for practitioners is therefore: identify the beneficiary, identify the income type, identify the foreign payer/entities, and check the approval letter conditions.
Who Does This Legislation Apply To?
The Order applies to United International Securities Trading (Pte) Ltd only. It is not a general relief measure for all Singapore taxpayers. The legal beneficiary is expressly named, and the exemption is tied to that company’s receipt of dividends in Singapore from its specified foreign subsidiaries.
Accordingly, the exemption’s applicability is fact-specific. A practitioner advising the company would need to confirm: (1) that the recipient is the named entity; (2) that the income is indeed dividends (as opposed to other distributions or payments); (3) that the dividends are received in Singapore; and (4) that the dividends are paid by the named subsidiaries (P.T. Astra International Tbk, Ayala Corporation, Zinifex Ltd, and Hang Lung Properties Ltd). The exemption is also contingent on compliance with the terms and conditions in the 5 January 2007 approval letter.
Why Is This Legislation Important?
For tax practitioners, the importance of this Order lies in its direct impact on the tax treatment of cross-border corporate income. Dividends received by a Singapore company can be subject to Singapore tax depending on the applicable regime. This Order provides a specific exemption for certain dividends, which can materially affect effective tax rates, cash flow, and financial statement tax disclosures.
Because the exemption is entity-specific and payer-specific, it also highlights a common compliance theme in Singapore tax practice: exemptions granted by subsidiary legislation are often narrow and must be applied carefully. Over-claiming an exemption—such as treating dividends from non-listed subsidiaries as covered—can create exposure to tax adjustments, penalties, and interest, and may also raise issues about whether conditions in the approval letter were satisfied.
Finally, the conditional reference to the approval letter means that practitioners should not treat the Order as self-executing in isolation. The approval letter’s terms are incorporated by reference. In practice, the letter may require the company to maintain certain corporate structures, meet eligibility criteria, provide documentation, or comply with reporting requirements. If conditions are not met, the exemption could be challenged or withdrawn, depending on how the approval letter and the Income Tax Act operate in conjunction with the Order.
Related Legislation
- Income Tax Act (Chapter 134) — in particular section 13(12) (the enabling provision for the Minister’s power to grant exemptions)
- Income Tax (Exemption of Foreign Income) (No. 3) Order 2007 — the instrument analysed (SL 368/2007)
- Income Tax legislation timeline — for confirming the correct version and any subsequent amendments (if any)
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.