2024 GST Series: A Deeper Look at the Zero-Rating of International Services and Recovery of Expenses

Description

This is a practical workshop that dives deep into 2 major challenging aspects of GST: GST treatment on International Services and GST treatment on Recovery of Expenses.

Companies may only zero-rate their supply of services if it falls within the description of international services under Section 21(3) of the GST Act. Depending on the nature of your services, you may be required to determine your customer's belonging status (i.e. whether the customer is a local or an overseas entity) before your supply of services can be zero-rated. Not all services provided to overseas customers can be zero-rated.

For the purpose of GST, the term "reimbursement" refers to the recovery of an expense that you incur as a principal from another party. A reimbursement may be subject to GST if it is consideration for a supply of goods or services. On the other hand, the recovery of a payment made on behalf of another party by you as an agent is termed as a "disbursement". A disbursement does not constitute a supply and hence, is not subject to GST. Understanding the differences between reimbursements and disbursements is essential as they are treated very differently for GST reporting purposes.

This workshop will use practical scenarios, case studies and examples to reinforce your understanding of the correct GST treatment on international services and recovery of expenses for GST reporting purposes. With a sound practical knowledge in these 2 major GST areas, you will be able to apply these concepts correctly in real life and avoid unnecessary errors and penalties.

Programme Outline

GST Treatment on International Services

• Determining the belonging status of customers
• Clarification on “directly in connection with” and “directly benefit”
• Misconceptions
• List of services and their conditions
• Examples and illustration
• Avoiding the mistakes commonly made in applying zero-rating
• Recent updates

GST Treatment on Recovery of Expenses

• Difference between reimbursement and disbursement
• Are you acting as a principal or an agent?
• Indicators for determining the principal or agent relationship
• Recovery of expenses which is ancillary to a primary supply
• Recovery of expenses which is separate and not ancillary to any primary supply
• Recovery of expenses at costs or with a mark-up – is there a difference?

Practical scenarios, case studies and examples will be used throughout the session to reinforce your understanding and application of the concepts in real life.

What you will learn

• Deepen your understanding of the challenging concept of zero-rating international services
• Gain in-depth insights on the essential issues and peculiarities of zero rating international services
• Find out and avoid the mistakes commonly made in applying zero-rating
• Learn how to establish whether the recovery of expense is a reimbursement or disbursement
• Be able to ascertain the agent-principal relationship, differentiate between reimbursement and disbursement, and ascertain the GST treatment for the recovery of expenses
• Learn to rightly determine and apply GST treatment to avoid unnecessary errors and incurring costly penalties

Target Audience

• Tax Professionals and Executives
• Finance Managers and Executives
• Accountants and Accounts Executive (involved with the preparation of GST returns or in the determination of the GST treatment for goods and/or services provided by their companies)
• Anyone involved in GST compliance

Expert Speaker

Catherine Chiang

Catherine is a Senior GST Consultant who has previously spent 6 years in the IRAS, handling GST and Income Tax audit and almost 10 years with Big Four international accounting firms, specialising in GST compliance and advisory work. During this period, she has accumulated extensive experience in performing GST prudential reviews, GST consultancy, GST compliance, GST audits and GST training for clients.

Catherine has a Bachelor of Accountancy (Honours) degree from the National University of Singapore. She is an Accredited Tax Advisor (GST) registered with the Singapore Chartered Tax Professionals and a member of the Institute of Singapore Chartered Accountants. Catherine is also an ACTA certified Trainer.