Singapore: Tax treatment of appropriation of trading stock and conversion of non-trade/capital assets
A new e-tax guide on tax treatment of appropriation of trading stock and conversion of non-trade/capital assets
A new e-tax guide
The Inland Revenue Authority of Singapore (IRAS) released a new e-tax guide—Tax Treatment on Appropriation of Trading Stock for Non-Trade or Capital Purposes and Conversion of Non-Trade or Capital Assets to Trading Stock—that provides details on the income tax treatment when trading stock held by businesses is appropriated for non-trade or capital purposes and when non-trade or capital assets are converted to trading stock.
Its release follows the insertion of section 10J of the Singapore Income Tax Act 1947 that applies to an appropriation of trading stock for non-trade or capital purposes and section 32A of the Income Tax Act that applies to a conversion of non-trade or capital asset to trading stock, both of which came into effect on 16 November 2021.
Prior to the introduction of section 10J, the Comptroller of Income Tax may have in certain instances taxed the notional gains arising from the appropriation of trading stock.
Read a May 2022 report [PDF 292 KB] prepared by the KPMG member firm in Singapore
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.