Singapore Company Annual Review and Tax Filing Key Points Businesses Must Know

Annual Filing and Tax Compliance in Singapore Key Details Every Business Must Know

In the process of operating a business in Singapore, compliance management is foundational to ensuring long-term stability and sustainable growth. Among the key compliance obligations, annual filing and tax reporting play a critical role-not only in maintaining legal standing, but also in safeguarding financial health and operational efficiency.

Particularly in 2025, with the Accounting and Corporate Regulatory Authority ACRA and the Inland Revenue Authority of Singapore IRAS intensifying their oversight on corporate compliance, businesses must pay close attention to the execution details of these two core processes.

1. Annual Filing Ensuring Continued Legal Operation

All registered companies in Singapore-regardless of whether they are actively conducting business-are required to submit an Annual Return to ACRA each year and complete a Declaration of Compliance by directors. Additionally, depending on the company type private limited or public company, audited or unaudited financial statements must be submitted.

A major change in 2025 is ACRA’s stricter enforcement of penalties for late filings. Under the updated regulations, companies that fail to file on time will face fines, and in severe cases, may even be compulsorily struck off the register. Recently, a local startup was fined over SGD 10,000 for delayed submission of its annual report, which subsequently disrupted its fundraising plans. This serves as a reminder that annual filing is not merely a bureaucratic formality-it is a vital component of corporate credibility and operational continuity.

For small and medium-sized enterprises SMEs, those with annual revenue below certain thresholds and total assets within specified limits may qualify for audit exemption. However, they are still required to submit unaudited financial statements. While this policy alleviates some burden for SMEs, it also requires business owners to possess basic financial knowledge or seek assistance from professionals.

2. Tax Reporting Accurate Compliance to Avoid Risks

Singapore operates a territorial tax system, meaning companies are taxed only on income sourced within the country. Each year, IRAS oversees the tax reporting process, during which businesses must submit financial statements, tax computations, and supporting documents before the deadline.

Typically, the tax filing deadline falls three months after the end of the financial year. For example, if the fiscal year ends on December 31, 2025, the deadline would be March 31, 2026.

In recent years, IRAS has significantly strengthened its crackdown on false declarations and tax fraud. Early in 2025, the agency uncovered a case involving multiple local companies issuing fake invoices totaling millions of Singapore dollars. Several individuals were prosecuted and faced criminal penalties. These incidents underscore the importance of honesty and transparency in tax reporting.

At the same time, IRAS continues to promote digital transformation in tax processes. Most businesses now use the myTax.Industry platform for online submissions, improving efficiency and reducing errors. It is advisable for companies to familiarize themselves with the e-filing system early or engage professional accounting firms to ensure accurate data submission.

3. Interconnection Between Annual Filing and Tax Reporting

Although annual filing and tax reporting are governed separately by ACRA and IRAS, they are closely interrelated. For instance, the financial statements submitted for annual filing often serve as the basis for tax reporting, while the profit figures declared in tax filings appear in the annual report.

When preparing both submissions, companies should ensure consistency and logical coherence in the data presented. Discrepancies may trigger regulatory scrutiny or investigations. Common mistakes include improper formatting of financial statements, failure to disclose related-party transactions, and incorrect classification of revenues and expenses. Although seemingly minor, these issues can become red flags during audits or tax reviews. Therefore, attention to detail during preparation is crucial, and seeking help from professional accountants when necessary is highly recommended.

4. Common Misconceptions and Recommendations

Despite clear guidelines, many business owners still hold misconceptions regarding annual filing and tax compliance

1. No business means no need to file

Even if a company is dormant, as long as it remains officially registered, it must fulfill its filing obligations. Failure to do so constitutes non-compliance.

2. Adjust profits arbitrarily to reduce taxes

IRAS uses a risk-based assessment system that flags unusual financial patterns. Any unreasonable adjustments may lead to deeper investigations.

3. Outsourcing ensures full compliance

While third-party accounting services can handle filings, ultimate responsibility lies with the company directors. Business owners should regularly review submitted documents to ensure accuracy and authenticity.

5. Conclusion

Amid increasing global economic uncertainty, Singapore continues to attract a large number of investors due to its efficient business environment and stable financial system. However, while benefiting from favorable policies, businesses must also fulfill their compliance responsibilities.

Annual filing and tax reporting are not just statutory requirements-they are essential tools for building a credible corporate image and mitigating potential risks. For businesses operating in Singapore, staying updated on regulatory changes, establishing robust internal financial controls, and appropriately leveraging professional services are crucial steps toward sustainable growth.

Only through such efforts can companies confidently navigate this global business hub and seize new opportunities for development.