Statute Details
- Title: Income Tax (Exemption of Foreign Income) (No. 6) Order 2005
- Act Code: ITA1947-S514-2005
- Type: Subsidiary Legislation (SL)
- Authorising Act: Income Tax Act (Chapter 134)
- Authorising Provision: Section 13(12) of the Income Tax Act
- Enacting Date: 26 July 2005
- Commencement: Dated in the timeline as 01 Aug 2005 (SL 514/2005)
- Current Status: Current version as at 27 Mar 2026
- Key Provisions (from extract): Section 1 (Citation); Section 2 (Exemption)
- Related Legislation: Income Tax Act (Chapter 134); Legislation timeline (for version control)
What Is This Legislation About?
The Income Tax (Exemption of Foreign Income) (No. 6) Order 2005 is a Singapore tax exemption order made under the Income Tax Act (Chapter 134). In practical terms, it grants a specific company an exemption from tax on certain foreign-sourced income received in Singapore.
From the text provided, the Order grants Sincere Watch Limited an exemption from tax on foreign dividends received in Singapore from any country outside Singapore. This is not a general exemption available to all taxpayers; it is a targeted, company-specific exemption.
The exemption is granted subject to conditions set out in a letter of approval dated 31 May 2005 addressed to the company. That approval letter is therefore central to understanding the scope and compliance requirements of the exemption, even though the Order itself does not reproduce those conditions.
What Are the Key Provisions?
Section 1 (Citation) provides the formal name by which the Order may be cited: the “Income Tax (Exemption of Foreign Income) (No. 6) Order 2005”. While this is standard drafting, it matters for legal referencing, especially in tax filings, correspondence with the Inland Revenue Authority of Singapore (IRAS), and in any dispute or audit where the taxpayer must identify the precise legal instrument relied upon.
Section 2 (Exemption) is the operative provision. It states that Sincere Watch Limited is granted an exemption from tax on foreign dividends received in Singapore from any country outside Singapore. The breadth of the phrase “any country outside Singapore” indicates that the exemption is not limited to dividends from particular jurisdictions; rather, it covers foreign dividends generally, subject to the conditions.
Importantly, the exemption is conditional. Section 2 expressly states that the exemption is “subject to the conditions specified in the letter of approval dated 31st May 2005 addressed to the company.” This means that the exemption is not absolute. If the company fails to satisfy the conditions, the exemption may not apply (or may be withdrawn), and tax could become payable. For practitioners, this elevates the approval letter from a background document to a material legal instrument governing the exemption’s operation.
Finally, the Order includes the making clause and signature block: it was made on 26 July 2005 by LIM SIONG GUAN, Permanent Secretary, Ministry of Finance. The enacting formula and signature are relevant for confirming the authority and validity of the instrument, particularly if a taxpayer’s entitlement is challenged.
How Is This Legislation Structured?
This Order is structured in a very concise format, typical of subsidiary legislation that grants a specific exemption. Based on the extract, it contains:
(1) A citation provision (Section 1), and (2) an exemption provision (Section 2). There are no additional parts or detailed schedules in the extract, and no general definitions are included beyond what is necessary for the operative clause.
From a practitioner’s perspective, the structure signals that the legal “work” is done in Section 2, while the conditions are located externally—in the letter of approval dated 31 May 2005. Therefore, the effective legal framework is a combination of:
the Order (granting the exemption to the named company), and
the approval letter (setting the conditions that determine whether and how the exemption applies).
Who Does This Legislation Apply To?
The Order applies to Sincere Watch Limited only. The exemption is granted to a named taxpayer, not to a class of taxpayers. As such, other companies cannot rely on this Order as a basis for exemption unless they are similarly granted an exemption under a separate order or under a different statutory mechanism.
In addition, the exemption applies to foreign dividends received in Singapore from outside Singapore. The phrase “received in Singapore” is significant: it ties the exemption to the location of receipt (Singapore) rather than merely to the source of the dividends. Practitioners should therefore consider the company’s dividend receipt mechanics (e.g., whether dividends are credited to accounts in Singapore) when assessing entitlement.
Why Is This Legislation Important?
Although the Order is short, it is legally important because it provides a formal statutory basis for a tax exemption that would otherwise be governed by the general rules in the Income Tax Act. In Singapore’s tax system, exemptions are typically not presumed; they must be grounded in legislation or in a specific approval mechanism. This Order is one such instrument.
From a compliance and advisory standpoint, the conditional nature of the exemption is the main practical issue. Because Section 2 makes the exemption “subject to the conditions” in the 31 May 2005 approval letter, the company’s ongoing tax position depends on whether those conditions were met (and continue to be met, if the conditions are ongoing). In practice, this can affect:
- Tax reporting (whether foreign dividends are treated as exempt in returns);
- Audit readiness (documenting satisfaction of conditions);
- Risk management (understanding consequences if conditions are breached);
- Corporate actions (e.g., restructuring, changes in shareholding or operations) that might affect compliance with approval conditions.
For lawyers, the Order also illustrates how subsidiary legislation can operate as a bridge between statutory power and administrative approval. The Minister for Finance acts under section 13(12) of the Income Tax Act. The Order then gives effect to an exemption that is tied to a specific approval letter. This is a common pattern in tax law: the statute confers broad power, while the order and approval letter define the concrete entitlement and its conditions.
Finally, the existence of a “current version as at 27 Mar 2026” and the timeline reference underscores a practical point for legal research: even though the Order is dated 2005, practitioners must ensure they rely on the correct version and confirm whether any amendments, consolidations, or republications affect the text. The platform’s instruction to check the legislation timeline is therefore not merely procedural—it can be critical in disputes about what the law said at the relevant time.
Related Legislation
- Income Tax Act (Chapter 134) — in particular, section 13(12) (the authorising provision for making exemption orders)
- Legislation timeline / version history — to confirm the correct version of SL 514/2005 as at the relevant date
Source Documents
This article provides an overview of the Income Tax (Exemption of Foreign Income) (No. 6) Order 2005 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.