In the first half of 2019, CSCCI signed an agreement with the Makati Business Club during the visit of the House delegation. The agreement aims to promote closer trade relations between Singapore and Philippine companies. Countries with which the Philippines currently has double taxation agreements (DBA): an exhaustive list of DBA, limited contracts and other agreements is available on the official website of the Singapore Internal Revenue Administration (IRAS). The DBA and other such tax treaties create security in the taxation of income from foreign sources and prevent international tax evasion. Philippines-Singapore also signed a DBA with the Philippines effective January 1, 1977. Some sources of income that apply to dual tax breaks, as defined in the contract, are: corporate profits, dividends, management fees, licensing fees and other foreign sources of income. Double taxation relief methods are given either under a country`s national tax law or under the tax treaty. The methods available in Singapore are as follows: the development of international trade and multinationals has increased the need to examine the issue of double taxation. As a company or individual looking for business opportunities and investments beyond your own country, you would of course deal with the problem of taxation, especially if you will have to pay twice taxes on the same income in the host country and in your country of origin. As a result, you are trying to structure your operations to optimize your tax position and reduce costs that, in turn, would increase your global competitiveness. It is the relevance of the DBA or Singapore`s tax treaties that comes into play.
Double taxation agreements are documents signed between two countries that contain provisions to avoid double taxation of the same source of income. Each country has its own local tax laws and DBAs may differ in their specificities, but general principles apply when earned income is not taxed twice. For example, in Singapore, a company may demand two tax breaks up to the border between the lower tax in the Philippines and the Singapore tax payable. For example, if the Singapore tax payable is S30,000 and the Philippine tax is $40,000, the maximum maximum tax relief that can be invoked is $30,000.