Full Imputation System

(for Singapore resident companies only)

One-Tier Corporate Tax System

(Applies to all companies)

Tax payable on normal chargeable income is not a final tax (i.e. shareholders will still be taxed on the dividend income).

Tax payable on normal chargeable income is a final tax (i.e. shareholders will not be taxed on the exempt one-tier dividend income).

Tax payable can be passed to shareholders as tax credits on payment of dividend by way of the Section 44 account mechanism (franked dividends).

Tax assessed on or after 1.1.03 will not form part of the Section 44 balance as at 31.12.02.

Shareholders are taxed on gross dividend and tax credits are given.

Dividend paid out of after tax profit will be exempt from tax in the hands of shareholders (exempt one-tier dividends).