Australia-Singapore DTAA: Double Tax Avoidance Agreement
A DTAA is an agreement between two countries which aims to eliminate the double taxation of the same income in the two countries. Often the tax laws of the countries are such that if any income flows from one country to the other, a taxpayer may be liable to get taxed twice; a DTAA prevents this from happening.
Besides preventing a business or personal income from being taxed twice, the DTAA may also provide lower tax rates for certain types of income in comparison to their prevailing tax rates; these provisions are beneficial to taxpayers and can reduce their overall tax burden.
What Is the DTAA between Australia and Singapore?
The Australia-Singapore DTAA provides tax relief to residents of the countries which are parties to the agreement. The tax relief arises in circumstances where income would otherwise be subject to tax in both countries.
Generally, if a taxpayer is a resident of Australia and derives income from Singapore, his income could be taxable in both the countries. But under the provisions of the DTAA, Australia will provide tax relief by crediting the tax paid on the income in Singapore against the tax due to Australia. Similarly, Singapore would do the same for the opposite case.
Scope of Australia-Singapore DTAA
What Taxes Will I Owe Under the Australia-Singapore Double Tax Agreement?
Double Tax Avoidance Agreement at a Glance
Type of income or payment
Where it is taxed
Income from immovable property
Profits from business
Profits from shipping and air transport
Personal and professional services (including directors' fees)
Income or gains from the alienation of property
Pension and annuity
Remuneration paid by the Government
Payments to students and trainees
* These services are not taxable in the other state even if the services are carried out in that state in the following circumstances:
- If the individual resides in the other state for a period less than an aggregate of 183 days for the year of income.
- The services of the individual are performed on behalf of a person residing in another state.
- The income or profits are not attributable to any permanent establishment in the other state.
These exemptions are not applicable to any personal income that a public entertainer, such as musicians, athletes, stage and movie show artists derives from their personal activities. The public entertainers are taxed in the state where they carry out their services.
To learn more, you can find a full copy of the Australia-Singapore Double Tax Treaty Agreement.
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