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Indirect Tax

GST cashflow savings – Major Exporter Scheme “MES”

Jeremy O’Neill Jeremy O’Neill

Is your business substantially involved with the import and export of goods? Are you unnecessarily paying import GST and having to wait to file your GST return before you claim input tax credit for the import GST paid to Singapore Customs? If you are, the MES status could dramatically increase your business’s cashflow and working capital position.

Overview & benefits:

The MES is aimed at supporting and encouraging import-export businesses to use Singapore as a transhipment hub for its imports and exports of goods.

The MES entitles approved businesses that have substantial exports, to enjoy cashflow relief from the suspension of import GST that is usually payable upon the importation of non-dutiable goods into Singapore.

Qualifying conditions:

There are a number of conditions the business must meet to qualify for the scheme such as:

  • being GST-registered
  • being active and financially solvent
  • importing, or planning to import, goods for your business purposes (such as those for resale)
  • the value of its zero-rated supplies must be either
    • More than 50% of total supplies OR
    • More than S$10m in the previous 12 months
  • maintaining good internal controls and proper accounting records and
  • having a good compliance record with the Inland Revenue Authority of Singapore (IRAS), and Singapore Customs

Obtaining MES status:

To apply for MES status, the business must:

  • satisfy the qualifying conditions (outlined above),
  • perform a self-review using the Assisted Self-help Kit “ASK” methodology prescribed by the IRAS,
  • submit the application form F10 (application for MES) and the certified ASK declaration forms to the IRAS (ASK declaration form must be certified by a tax professional who has been accredited by the Singapore Institute of Accredited Tax Professional - SIATP); and
  • submit a “Letter of Confirmation & Undertaking” to confirm that the business imports or will import goods belonging to a third party or parties, where applicable.

Our approach / how we help:

Phase 1 – Preliminaries

Our experience has shown that investing time at the outset of our engagements to understand our clients and their specific  circumstances, reduces the overall timescales and costs involved for both parties.

We will work with you to establish whether the business qualifies for the scheme and help you understand its true benefits.

Phase 2 – Scope of work & application

Our GST specialists, who are accredited with the SIATP, will work with you and your teams in a collaborative way, to ensure that the ASK review is completed, signed-off and submitted to the IRAS in accordance with the MES application requirements.

Phase 3 – Implementation

From the understanding we gained of your finance system(s) and GST reporting process during the ASK review, we can advise and assist you on the changes required to ensure the business remains GST-compliant and thus eligible to continue enjoying the benefits of the MES status.

Next step / how to begin:

Feel free to contact a member of our team to have a preliminary discussion.