Statute Details
- Title: Income Tax (Exemption of Foreign Income) (No. 5) Order 2007
- Act Code: ITA1947-S452-2007
- Type: Subsidiary Legislation (SL)
- Authorising Act: Income Tax Act (Chapter 134)
- Authorising Provision: Section 13(12) of the Income Tax Act
- Enacting Date / Made By: 24 August 2007
- Citation: SL 452/2007
- Commencement Date: Not stated in the extract (commonly the date of making/notification applies, subject to the instrument)
- Key Provisions (from extract): Section 1 (Citation); Section 2 (Exemption)
- Status: Current version as at 27 March 2026 (per the legislation portal)
What Is This Legislation About?
The Income Tax (Exemption of Foreign Income) (No. 5) Order 2007 is a targeted tax exemption instrument made under Singapore’s Income Tax Act. In substance, it grants a specific company an exemption from Singapore tax on certain dividends it receives in Singapore from a foreign subsidiary.
Unlike broad-based tax regimes that apply to categories of taxpayers, this Order is company-specific. It is directed at EGL Asia Pacific Holdings Company Pte Ltd and concerns dividends received in Singapore from its subsidiary in Bermuda, Regga Holdings Ltd. The exemption is not unconditional: it is granted subject to terms and conditions set out in a letter of approval dated 18 July 2007 addressed to the company.
Practically, the Order sits within Singapore’s broader policy framework for relieving double taxation and encouraging corporate structuring. It does so by allowing certain foreign-sourced income (here, dividends from a foreign subsidiary) to be exempt from Singapore tax, provided the statutory and approval conditions are satisfied.
What Are the Key Provisions?
Section 1 (Citation) provides the formal short title of the instrument: the Income Tax (Exemption of Foreign Income) (No. 5) Order 2007. This is standard drafting and is mainly relevant for legal referencing and compliance documentation.
Section 2 (Exemption) is the operative provision. It states that EGL Asia Pacific Holdings Company Pte Ltd is granted an exemption from tax on the dividends received in Singapore from its subsidiary Regga Holdings Ltd in Bermuda. The exemption is expressly “subject to the terms and conditions specified in the letter of approval dated 18th July 2007 addressed to the company.”
From a practitioner’s perspective, the most important legal features of Section 2 are: (1) the identity of the taxpayer (the exemption is not generic); (2) the type of income (dividends received in Singapore); (3) the source relationship (dividends from a subsidiary in Bermuda); and (4) the conditionality (the exemption depends on compliance with the approval letter’s terms and conditions). The approval letter is therefore not merely background—it is effectively part of the compliance architecture that determines whether the exemption applies.
The Order also includes the making clause and signature block. It records that the Minister for Finance makes the Order in exercise of powers conferred by section 13(12) of the Income Tax Act. The instrument is “made” on 24 August 2007 by the Permanent Secretary, Ministry of Finance, Singapore (TEO MING KIAN). This matters for validity and for understanding that the exemption is granted through the statutory delegation mechanism under the Income Tax Act.
Finally, the extract includes an annotation reference (e.g., [MF(R)32.16.056 V36; AG/LEG/SL/134/2005/6 Vol. 1]), which is useful for locating the official file trail and for confirming the instrument’s administrative history. While not a substantive condition, such references can assist counsel when dealing with queries from tax authorities or when compiling an audit-ready compliance file.
How Is This Legislation Structured?
This Order is extremely short and consists of a minimal structure typical of company-specific tax exemption instruments. It contains:
(a) Enacting formula — sets out the legal basis for the Minister’s power, namely section 13(12) of the Income Tax Act.
(b) Section 1 (Citation) — provides the short title.
(c) Section 2 (Exemption) — grants the exemption and specifies the company, the dividend stream, the foreign subsidiary, and the condition that the exemption is subject to the approval letter dated 18 July 2007.
There are no Parts, schedules, or detailed definitions in the extract. The operative content is therefore concentrated in Section 2, with the approval letter acting as the key document for the detailed conditions.
Who Does This Legislation Apply To?
The Order applies to EGL Asia Pacific Holdings Company Pte Ltd only. It is not drafted as a general exemption for all companies meeting certain criteria. Consequently, other taxpayers cannot rely on this Order unless they are the named company and the relevant dividend conditions match the instrument.
The exemption relates to dividends received in Singapore from Regga Holdings Ltd, a subsidiary in Bermuda. In other words, the exemption is tied to a specific corporate relationship and a specific income flow. Even for the named company, the exemption would be expected to apply only to the dividends that fall within the described stream and that are received in Singapore, and only if the company complies with the terms and conditions in the 18 July 2007 letter of approval.
Why Is This Legislation Important?
This Order is important because it demonstrates how Singapore can grant bespoke tax relief through subsidiary legislation under the Income Tax Act. For corporate counsel and tax practitioners, such instruments are often critical when advising on withholding tax exposure, effective tax rate, dividend planning, and the tax treatment of cross-border group structures.
From a compliance standpoint, the conditional nature of the exemption is the central practical issue. The Order does not itself list the conditions; it incorporates them by reference to the letter of approval dated 18 July 2007. That means practitioners must obtain, review, and operationalise the approval letter’s requirements—such as conditions relating to shareholding, corporate purpose, documentation, reporting, or other compliance obligations—because failure to meet those conditions could jeopardise the exemption.
In enforcement terms, because the exemption is granted by a legal instrument, the tax authority can assess whether the statutory preconditions and the approval conditions have been satisfied. For audit and dispute readiness, counsel should ensure that the company’s dividend declarations, intercompany agreements, corporate records, and the approval letter are aligned. The Order provides the legal “hook” for exemption, but the approval letter provides the “rules of the road.”
Finally, the instrument’s existence is relevant for structuring and due diligence. When reviewing group reorganisations or dividend flows, lawyers often need to confirm whether a company has a specific exemption order that affects tax outcomes. This Order is a clear example of a document that can materially affect the tax treatment of dividends from a foreign subsidiary.
Related Legislation
- Income Tax Act (Chapter 134) — in particular, section 13(12) (the enabling provision for the Minister’s power to make such exemption orders)
- Income Tax Act — legislative timeline / amendments (to confirm the operative version of section 13(12) and any subsequent changes affecting interpretation)
Source Documents
This article provides an overview of the Income Tax (Exemption of Foreign Income) (No. 5) Order 2007 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.