Tax Residency of a Company: Control and Management

February 28, 2024

Written by Sonia Goh

Under the Singapore Income Tax Act (“ITA”), a company is regarded as a tax resident1 of Singapore if the “control and management” of its business is exercised in Singapore.  However, the ITA does not further define “control and management”.

“Control and management” of a company is taken to mean important strategic decisions taken by the Board of Directors. This could include matters such as potential investments and business opportunities, divestment of investments, financing needs and company’s policies.  The location of the board meetings where such decisions are made would determine the place of residence of the company.

With technological advancement, it is now common for board meetings to be held via conference calls and video-conferencing for more efficient decision making.  This could well be the underlying reason for the Inland Revenue Authority of Singapore (“IRAS”) to reduce the emphasis of physical meetings and to amend its stance on how tax residency of a company is to be ascertained.

With effect 29 November 2023, where a Board of Directors meeting of a company is held by means of virtual meeting technology2, it will generally be regarded that strategic decisions are made in Singapore provided that either of the following conditions is met:

  1. At least 50% of the directors who have authority to make strategic decisions are physically in Singapore during the meetings; or
  2. The Chairman of the Board of Directors (if such an appointment exists in the company) is physically in Singapore during the meeting.


    For clarity purposes, the IRAS has given specific examples on scenarios where “control and management” of a company is not regarded as being exercised in Singapore:

    • Board of Directors meetings are not held in Singapore (i.e. Directors’ resolutions are passed by circulation).
    • The local Director is a Nominee Director and the remaining Board Directors reside outside Singapore.
    • No strategic decisions are made by the local Director in Singapore.
    • No key employees (e.g. CEO, CFO, COO) are based in Singapore.

    Bearing in mind the above, a company which would want to be regarded as a Singapore tax resident company should continue to ensure that key decisions are taken in Singapore and Board resolutions and Board meeting minutes are properly documented to support its claim.


    With regard to Foreign-Owned Investment Holding Companies3 which would like to apply for a Certificate of Residence (“COR”), effective year 2025, apart from demonstrating that strategic decisions are made in Singapore, the company must meet the following conditions:

    1. An Executive Director (who is not a Nominee Director) based in Singapore;
    2. One key employee (e.g. CEO, CFO, COO) based in Singapore; or
    3. It is managed by a related company based in Singapore

    The above is to ensure that such Foreign-Owned Investment Holding Companies have valid reasons to set up operations in Singapore.


    1 A Singapore tax resident company would qualify for the following benefits:

    • Exemption or reduction in tax on specified foreign income derived from a jurisdiction that has an Avoidance of Double Taxation Agreement with Singapore.
    • Tax Exemption on specified foreign income (i.e. foreign-sourced dividends, foreign-sourced service income and foreign branch profits) under Section 13(8) of the Income Tax Act.
    • Foreign tax credit for taxes paid in the foreign jurisdiction against the Singapore tax payable on the same income.
    • Tax exemption for new start-up companies.

    2 Virtual meeting technology means any technology that allows a person to participate in a meeting without being physically present at the place of meeting.

    3 A foreign-owned company is defined as a company where more than 50% of its shares are held by:

    • Foreign companies that are incorporated outside Singapore; or
    • Individual shareholders who are not citizens of Singapore.

    The ownership is applied at the ultimate holding company level.

    If you wish to understand further, please reach out and speak to our Tax Advisers team in Ledgen Singapore today.



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