Follow Singapore Immigration and Life in Singapore: Currently, most governments around the world are cautious about Bitcoin; some refuse to recognize its legal status, while others have issued transaction warnings. However, Singapore recognizes Bitcoin transactions and has introduced tax rules for them.
The Inland Revenue Authority of Singapore (IRAS) wrote to the Singapore-based Bitcoin intermediary Coin Republic, stating that companies engaged in the buying and selling of Bitcoin will be taxed based on their sales revenue. However, if Bitcoin is held as a corporate investment asset for long-term investment purposes, the gains will not be subject to tax.
The Singapore tax authority also stated that using Bitcoin as a payment instrument to purchase real goods or services, such as digital content, will be subject to tax. However, if Bitcoin is used to purchase virtual goods or services, such as in-app purchases (IAP), "it will not be taxed unless the Bitcoin is used to exchange for real currency, goods, or services."
For Bitcoin trading platforms acting solely as intermediaries, the Singapore tax authority stated that it will tax the commission fees. However, if the intermediary company also participates in the buying and selling of Bitcoin, it will be subject to Goods and Services Tax (GST) on both its sales revenue and commissions. These tax regulations currently apply only to Bitcoin traders in Singapore; if a Bitcoin trading company is registered overseas, it is not governed by these regulations.
