Statute Details
- Title: Income Tax (Exemption of Foreign Income) Order 2019
- Act Code: ITA1947-S33-2019
- Legislation 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: 8 January 2019
- Commencement Date: Not stated in the extract (order is made on 8 January 2019)
- Key Provisions: Section 1 (Citation); Section 2 (Exemption)
- Status: Current version as at 27 Mar 2026 (per the legislation portal extract)
- Legislative Instrument Number: S 33/2019 (SL 33/2019)
What Is This Legislation About?
The Income Tax (Exemption of Foreign Income) Order 2019 is a targeted tax exemption order made under the Income Tax Act. In plain terms, it grants an exemption from Singapore income tax for a specific category of foreign-sourced income—namely, dividends—received by a particular Singapore company from a related company abroad.
Unlike general tax relief regimes that apply broadly to many taxpayers, this Order is narrow in scope. It identifies (i) the recipient company, (ii) the payer company, (iii) the type of income (dividends), (iv) the quantum of dividends, and (v) the year of assessment. The Order therefore functions as a bespoke legislative instrument implementing a tax approval process.
Practically, the Order reflects how Singapore administers certain exemptions for foreign income: where the Minister for Finance grants approval under the Income Tax Act, the exemption is then given effect through a subsidiary legislation order. The Order also makes the exemption conditional on compliance with specified terms and conditions contained in a letter of approval.
What Are the Key Provisions?
Section 1 (Citation) provides the formal name of the instrument: “Income Tax (Exemption of Foreign Income) Order 2019”. This is standard drafting, but it matters for legal citation and for ensuring practitioners reference the correct subsidiary legislation.
Section 2 (Exemption) is the substantive provision. Subsection (1) states that income comprising dividends amounting to £8,883,325 received in Singapore by Frasers Property (Europe) Holdings Pte. Ltd. (a company incorporated in Singapore) from Frasers Property (UK) Limited (a company incorporated in the United Kingdom) is exempt from tax for the year of assessment 2015.
This drafting is legally significant in several ways. First, the exemption is tied to a specific amount of dividends (the figure is not expressed as a range or formula). Second, it is tied to a specific recipient and specific source of dividends (the UK payer). Third, it is tied to a specific year of assessment (YA 2015). As a result, the exemption is not automatically transferable to other years, other dividend amounts, or other intercompany relationships.
Section 2(2) (Conditions) introduces an important compliance element. The exemption under subsection (1) is subject to the terms and conditions specified in paragraphs 3 and 4 of a letter of approval dated 26 November 2018 addressed to KPMG Services Pte. Ltd., the tax agent of the recipient company.
From a practitioner’s perspective, this is the most consequential “hook” in the Order. The subsidiary legislation itself does not reproduce the conditions; instead, it incorporates them by reference to the approval letter. Therefore, legal advice and tax compliance will require obtaining and reviewing the relevant approval letter (or at least the specific paragraphs referenced) to confirm what obligations were imposed—such as reporting requirements, documentation standards, anti-avoidance assurances, or other governance conditions.
Because the exemption is expressly “subject to” those terms and conditions, failure to comply could jeopardise the exemption. While the extract does not state the consequence of non-compliance, the conditional drafting strongly suggests that the exemption is contingent upon adherence to the approval terms. In disputes, the approval letter and evidence of compliance would likely be central.
How Is This Legislation Structured?
This Order is structured in a minimal, two-section format typical of targeted exemption instruments.
Section 1 sets out the citation. Section 2 contains the exemption and its conditions. There are no additional parts or schedules in the extract provided. The operative content is therefore concentrated entirely in Section 2, with the conditions being incorporated by reference to an external letter of approval.
For legal research and practice, this means that the “work” of interpretation is largely confined to (i) identifying the exact income and taxpayer described in Section 2(1), and (ii) locating and analysing the referenced conditions in the approval letter described in Section 2(2).
Who Does This Legislation Apply To?
The Order applies to Frasers Property (Europe) Holdings Pte. Ltd., a company incorporated in Singapore, in relation to dividends received in Singapore from Frasers Property (UK) Limited in the United Kingdom.
It is also limited to a specific tax period: the year of assessment 2015. Accordingly, the exemption does not automatically extend to other years, other dividend payments, or other types of foreign income. It is best understood as a legislative confirmation of a particular tax approval for a particular transaction or set of dividends.
Although the approval letter is addressed to the recipient’s tax agent (KPMG Services Pte. Ltd.), the exemption is granted to the taxpayer (Frasers Property (Europe) Holdings Pte. Ltd.). Practitioners should therefore ensure that the taxpayer, its agent, and relevant corporate groups understand the conditions and who is responsible for satisfying them.
Why Is This Legislation Important?
This Order is important because it demonstrates how Singapore implements certain foreign income exemptions through a combination of (i) statutory power in the Income Tax Act and (ii) a subsidiary legislation instrument that gives effect to an approved exemption.
For practitioners, the key value of the Order is its certainty for the specified dividends and year of assessment. Where the conditions are met, the taxpayer can treat the specified dividends as exempt from Singapore tax, reducing tax exposure and supporting accurate tax computation and filing positions.
However, the conditional nature of the exemption means that the Order is not merely a “rubber stamp”. The exemption is explicitly “subject to” the terms and conditions in the approval letter. In practice, this shifts the focus from the text of the Order to the approval documentation and compliance evidence. A lawyer advising on tax positions for YA 2015 would typically need to confirm: (a) whether the dividends fall within the amount and description specified; (b) whether the dividends were received in Singapore; and (c) whether the taxpayer complied with the approval conditions in paragraphs 3 and 4 of the letter dated 26 November 2018.
Finally, the Order is a useful reference point for understanding the administrative and legal mechanics of tax exemptions for foreign income in Singapore. It illustrates the legal pathway: ministerial approval under the Income Tax Act, followed by a specific exemption order. This can inform how counsel approaches similar exemption applications—particularly the importance of ensuring that approval conditions are clearly documented, understood, and operationalised.
Related Legislation
- Income Tax Act (Chapter 134) — in particular, section 13(12) (the enabling provision for making exemption orders)
Source Documents
This article provides an overview of the Income Tax (Exemption of Foreign Income) Order 2019 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.