Singapore taxpayers to claim unabsorbed tax losses after ITBR ruling
16 February 2012
Joe Dalton
Taxpayers in Singapore are praising a recent Income Tax Board of Review (ITBR) decision for delivering certainty on the issue of when a shareholding test waiver may be granted following a substantial change of shareholders.
In the case of AVD v Comptroller of Income Tax (Comptroller), the ITBR ruled that the Comptroller was wrong to reject the taxpayer’s application for a waiver of the shareholding test.
“It is without doubt that the outcome of this ruling will be well received by taxpayers,” said Ong Sim Ho, director of tax at Singapore law firm Drew & Napier.
The taxpayer involved was a Singapore company that was indirectly owned by four family members, and had incurred significant tax losses in previous years of assessment, before its shareholdings were restructured to make one family member the sole owner of the company.
For a Singapore taxpayer to carry forward unabsorbed deductions for use in a future year of assessment, it must comply with the so-called shareholding test.
This rule...
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