How to Handle Accounting and Tax Filing for a Singapore Company? Key Steps and Important Tips You Should Know

Doing business in Southeast Asia? Singapore has always been a top choice. With its business-friendly environment, transparent policies, and attractive tax incentives, it draws countless SMEs and startups looking to set up shop here. But while registering a company is straightforward, what really keeps founders up at night is often what comes next - managing finances and filing taxes.

New entrepreneurs in Singapore often ask “I’ve registered my company - now what? How do I keep the books? When do I file taxes?” Let’s walk through the accounting and tax-filing process step by step, so you can avoid common pitfalls and stay compliant with confidence.

First things first In Singapore, every private limited company Pte Ltd, whether active or not, must maintain proper accounting records and file annual tax returns. This isn’t optional - it’s the law. Even if your company hasn’t started operations or made any profit yet, you still need financial statements, and eligible small companies may be exempt from audit requirements. You’ll also need to submit your corporate income tax return to IRAS on time.

So, how does it all work?

Step 1 Set Up a Compliant Accounting System

As soon as your company is incorporated, your first move should be setting up proper accounting books. Singapore follows International Financial Reporting Standards IFRS, which means you must use the accrual basis of accounting - recording income and expenses when they’re earned or incurred, not just when cash changes hands.

You can manage this yourself using cloud-based tools like Xero or QuickBooks, both widely used and user-friendly in Singapore. These platforms sync with your bank accounts, making bookkeeping much smoother. That said, if your operations are complex or you're short on time, hiring a licensed local accounting firm is a smart - and safer - option.

One critical reminder Keep all original documents - invoices, contracts, bank statements, payroll records - for at least five years. If IRAS ever audits your company and you can’t produce the paperwork, you could face fines.

Step 2 Regular Bookkeeping and Monthly/Quarterly Management

Many business owners think tax filing is a once-a-year task. Not true. Good financial management is ongoing. At a minimum, you should update your books monthly or quarterly to ensure all income, costs, and expenses are accurately recorded.

This is especially important if your business is GST-registered. Once your annual turnover exceeds SGD 1 million, you’re required to register for Goods and Services Tax GST and file returns every quarter. Miss a deadline, and the penalties add up fast. Just last year, a local restaurant chain was hit with nearly SGD 200,000 in back taxes and fines for late GST filings. In today’s era of digital oversight, compliance isn’t something you can afford to overlook.

Step 3 Year-End Audit and Financial Statement Preparation

In Singapore, you can choose your own financial year-end - it doesn’t have to align with the calendar year. For example, if you incorporated in March, you might set your fiscal year to end on March 31 each year.

After the financial year closes, you’ll need to prepare annual financial statements, including a balance sheet, income statement, and cash flow statement. Whether you need an audit depends on your company size.

Good news for startups Singapore offers audit exemptions for small companies. If your business meets at least two of these three criteria - annual revenue under SGD 100 million, total assets under SGD 50 million, and fewer than 200 employees - you can skip the mandatory audit. That’s a big cost saver.

But even without an audit, directors must sign off on the financial statements, confirming they’re accurate and truthful. Submitting false information can damage personal credit and even lead to legal consequences.

Step 4 Filing the Corporate Income Tax Return - Form C or Form C-S

Now we get to the real tax filing part. Typically within three months after your financial year ends, your company must submit a tax return to IRAS. Today, everything’s done online via CorpPass and the myTax Portal.

Most local small businesses qualify to use the simplified Form C-S, provided their annual revenue is under SGD 5 million and they’re not claiming loss carryforwards or complex tax reliefs. More complex cases require the full Form C, along with complete financial statements and tax computation details.

Here’s a key point Singapore taxes are based on the previous year’s profits. So the return you file in 2025 reflects your 2025 financial performance. The headline corporate tax rate is 17%, but there are partial tax exemptions that significantly reduce the effective rate - especially for smaller profits. For instance, the effective tax rate on the first SGD 100,000 of taxable income can be as low as around 8.5%. That’s great news for growing businesses.

Step 5 Paying Taxes and Staying on Track

Once IRAS reviews your submission, they’ll issue a Notice of Assessment. You’ll need to pay the tax due within one month of receiving it. Late payments attract penalties and monthly interest - up to 10% of the outstanding amount.

Starting in 2025, IRAS is pushing further into digitalization, encouraging companies to use GIRO automatic deductions or PayNow Corporate for faster, more reliable payments - reducing errors and missed deadlines.

The good news? Singapore has been actively improving the tax experience for businesses. Features like Pre-fill, where IRAS automatically populates parts of your tax form, help minimize mistakes. There’s also a “Tax Health Check” tool that lets companies spot potential risks early. All of this makes compliance easier and less intimidating for SMEs.

Sure, Singapore’s accounting and tax system is strict - but it’s also clear, well-supported, and designed to be navigable. As long as you keep clean books, stay on schedule, and possibly partner with a solid accounting team, most companies can handle it smoothly.

One final thought Starting a business is hard enough. But financial compliance shouldn’t feel like a burden - it’s actually a foundation for long-term success. Keeping accurate records isn’t just about satisfying the taxman. It helps you understand your business better, make smarter decisions, and build trust with customers, investors, and partners.

After all, a company that knows its numbers is a company ready to grow.