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The Singaporean tax administration, the Inland Revenue Authority of Singapore (IRAS), made a significant announcement during the 16th Forum of Tax Administration Plenary 2023.
The Singaporean tax administration revealed their intention to use the nationwide electronic invoicing (e-invoicing) network InvoiceNow for real-time collection of transactional invoice data to manage GST (local variant of VAT) reporting. This development marks another important milestone toward the adoption of e-invoicing in Singapore.
Singapore’s electronic invoicing journey to date
In 2019, the Infocomm Media Development Authority (IMDA) launched Peppol as Singapore’s nationwide e-invoicing standard. Rebranded locally to InvoiceNow in 2020, the network has since grown substantially, and today over 55,000 businesses have a Peppol ID.
Additionally, e-invoicing grants were announced last year, and earlier this year, the government indicated that InvoiceNow is the preferred channel for B2G invoicing.
Continuous Transaction Control (CTC) model
In line with Singapore’s Smart Nation Initiative, IRAS, together with IMDA and various GST-registered businesses, has been testing the use of InvoiceNow data to automate tax administration processes. IRAS communicated in a press release that the pilot trial has yielded positive results.
Singapore will implement the so-called Continuous Transaction Control (CTC) model. In this model, invoices are confirmed by both the sender and the recipient to the tax authority. Leveraging invoice data, the government can accurately calculate the GST amount.
This model has been adopted in many countries to combat the VAT gap, the difference between what a government’s expected VAT revenue and the total actually collected. IRAS emphasised in the press release the numerous benefits for companies offered by the Peppol CTC model, including easier GST compliance, potentially fewer audits, and expedited GST refunds.
Ensure your business stays tax compliant
No official launch date for the initiative has been communicated yet, but according to Seong Wah Geok, Director of Singapore's Peppol Authority, accredited service providers will soon receive more detailed information.
As a pioneer Peppol Access Point in Singapore, Banqup Group will closely monitor all developments. Don’t hesitate to get in touch with our local colleagues for more information on how our invoicing solutions can help you stay compliant.