Statute Details
- Title: Income Tax (Exemption of Foreign Income) (No. 6) Order 2017
- Act Code: ITA1947-S395-2017
- Legislation Type: Subsidiary Legislation (SL)
- Authorising Act: Income Tax Act (Chapter 134)
- Authorising Provision: Section 13(12) of the Income Tax Act
- Order Date / Made On: 14 July 2017
- Commencement: The exemption applies to dividends received “on or after 14 June 2017” (as specified in the operative provision)
- Key Provisions (from extract):
- Section 1 (Citation): Short title of the Order
- Section 2 (Exemption): Grants a targeted exemption for specified foreign dividends, subject to conditions
- Regulatory Reference: SL 395/2017
- Status: Current version as at 27 Mar 2026 (per document status note)
What Is This Legislation About?
The Income Tax (Exemption of Foreign Income) (No. 6) Order 2017 is a Singapore tax exemption order made under the Income Tax Act. In plain terms, it provides that certain foreign-sourced dividends received in Singapore by a specific Singapore company are exempt from Singapore income tax, provided that the company meets conditions set out in an approval letter issued by the tax authorities.
This Order is not a general “rule for everyone”. It is a targeted instrument. It identifies a particular Singapore incorporated company—New Toyo Lamination (M) Pte Ltd—and a particular foreign payer—New Toyo Aluminium Gulf Paper Packaging FZE, incorporated in the United Arab Emirates. The exemption applies to dividends received in Singapore from that foreign company on or after a specified date.
Orders of this type are commonly used to implement tax incentives or reliefs that are granted on a case-by-case basis. They sit alongside the broader framework of the Income Tax Act, which generally taxes income accruing in or derived from Singapore, and also provides mechanisms for exemptions where the Minister for Finance is empowered to grant them.
What Are the Key Provisions?
1. Citation (Section 1)
Section 1 simply states the short title: Income Tax (Exemption of Foreign Income) (No. 6) Order 2017. While this is standard drafting, it is important for practitioners because it allows the Order to be cited precisely in submissions, tax computations, and correspondence with the Inland Revenue Authority of Singapore (IRAS).
2. The Exemption for Foreign Dividends (Section 2)
The operative provision is Section 2, which contains the substantive exemption.
Section 2(1): Targeted exemption provides that:
- Dividends are received in Singapore by New Toyo Lamination (M) Pte Ltd;
- Those dividends are received on or after 14 June 2017;
- The dividends originate from New Toyo Aluminium Gulf Paper Packaging FZE, a company incorporated in the United Arab Emirates; and
- Such dividends are exempt from tax in Singapore.
Practically, this means that when New Toyo Lamination (M) Pte Ltd receives qualifying dividends from the specified UAE company, those dividends should not be included in its taxable income for Singapore income tax purposes—assuming the exemption conditions are satisfied.
Section 2(2): Conditions tied to an approval letter is crucial. It states that the exemption in Section 2(1) is subject to the conditions specified in paragraph 4 of the letter of approval dated 14 June 2017 addressed to Ernst & Young Solutions LLP, the tax agent of New Toyo Lamination (M) Pte Ltd.
This drafting approach has two legal consequences for a lawyer advising the company:
- Compliance is not optional: The exemption is conditional. If the company fails to comply with the conditions in the approval letter, IRAS may deny the exemption or require tax to be paid.
- The approval letter becomes a controlling document: Although the Order is the legal instrument granting exemption, the detailed conditions are located in the approval letter. Practitioners must therefore obtain and review the approval letter (and specifically paragraph 4) to confirm what obligations apply—such as documentation requirements, corporate structuring requirements, or restrictions on transactions.
3. Date and signatory
The Order records that it was made on 14 July 2017 and is signed by TAN CHING YEE, Permanent Secretary, Ministry of Finance. While this is not usually the focus of tax advice, it confirms the formal validity of the instrument and the authority under which it was issued.
How Is This Legislation Structured?
This Order is extremely concise. Based on the extract provided, it consists of:
- Enacting formula referencing the Minister’s power under section 13(12) of the Income Tax Act;
- Section 1 (Citation)—the short title;
- Section 2 (Exemption)—the operative exemption provision, including:
- Sub-paragraph (1) granting exemption for specified dividends; and
- Sub-paragraph (2) making the exemption conditional on the approval letter.
There are no “Parts” or detailed schedules in the extract, and the exemption is implemented through a single operative section. For practitioners, the key is to treat the approval letter referenced in Section 2(2) as part of the effective legal framework governing whether the exemption can be claimed.
Who Does This Legislation Apply To?
The Order applies to New Toyo Lamination (M) Pte Ltd, a company incorporated in Singapore. The exemption is limited to dividends received by that company in Singapore from the specified foreign company, New Toyo Aluminium Gulf Paper Packaging FZE (UAE), on or after 14 June 2017.
It does not apply broadly to all Singapore companies receiving foreign dividends. It is a bespoke exemption order. Therefore, other taxpayers cannot rely on it unless they are the named company and the dividends fall within the described source and timing parameters.
Additionally, the exemption is conditional on compliance with the conditions in the approval letter dated 14 June 2017 addressed to the company’s tax agent. Accordingly, the practical “applicability” question for counsel is not only whether the dividend is from the named foreign payer, but also whether the company has satisfied the conditions in the approval letter.
Why Is This Legislation Important?
For tax practitioners, the importance of this Order lies in its direct impact on tax computation and tax reporting. Dividends that qualify for exemption should not be taxed in Singapore. This can affect corporate effective tax rates, financial statement disclosures, and the company’s tax provisioning and compliance posture.
However, the Order’s conditional nature means it should be treated as a compliance-driven relief. The exemption is not automatic merely because dividends are received. Section 2(2) explicitly ties the exemption to conditions in a specific approval letter. In practice, this requires careful document management and evidence of compliance—especially if IRAS audits the tax treatment of foreign dividends.
From a legal risk perspective, the targeted drafting also means that practitioners should avoid over-reliance. If a company receives dividends from a different foreign entity, receives dividends outside the specified timeframe, or fails to meet the approval letter conditions, the exemption may not apply. In such cases, the dividends could be taxable under the general rules of the Income Tax Act, subject to any other applicable reliefs or exemptions.
Finally, this Order illustrates how Singapore uses subsidiary legislation to implement tax reliefs granted under ministerial powers. Lawyers advising on cross-border corporate structures, dividend flows, and tax incentives should therefore consider not only the Income Tax Act itself, but also the relevant exemption orders and the approval letters that often contain the operative conditions.
Related Legislation
- Income Tax Act (Chapter 134) — in particular, section 13(12) (the authorising provision for this Order)
- Income Tax (Exemption of Foreign Income) (No. 6) Order 2017 — SL 395/2017 (this instrument)
- Income tax exemption / foreign income exemption orders (as applicable in the legislation timeline and IRAS guidance)
Source Documents
This article provides an overview of the Income Tax (Exemption of Foreign Income) (No. 6) Order 2017 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.