The Manager has established an arrangement with the Inland Revenue Authority of Singapore ("IRAS") to allow eligible Soilbuild Business Space REIT ("Soilbuild REIT") Unitholders to use the back-end tax refund procedures to claim for over-deducted tax on income distributions from Soilbuild REIT.
Distributions made by Real Estate Investment Trusts ("REITs") listed on the Singapore Exchange to individuals, whether foreign or local, are tax exempt except where such distribution is derived by the individual through a partnership in Singapore or from the carrying on of a trade, business or profession. In this respect, IRAS has confirmed that all individuals will receive their distributions from Soilbuild REIT without tax being deducted at source ("gross distributions"). Individuals who derive the distributions through a partnership in Singapore or from the carrying on of a trade, business or profession will be required to declare the distributions in their income tax returns notwithstanding that they received gross distributions as they are not eligible for the aforesaid tax exemption.
In addition, REITs' distributions to qualifying foreign non-individual investors are subjected to a reduced rate of tax of 10% for distributions made during the period from 18 February 2005 to 31 March 2020 (both dates inclusive).
Who is eligible?
You can avail of this arrangement if you are:
- a foreign non-individual (see definition below) holding Soilbuild REIT Units in your own name; or
- an individual or a foreign non-individual whose Soilbuild REIT Units are held through a Depository Agent. Please approach your Depository Agent who will claim the refund on your behalf.
- a charity registered under the Charities Act (Cap.37) or established by any written law, a town council, a statutory board, a co-operative society registered under the Co-operative Societies Act (Cap. 62) or a trade union registered under the Trade Unions Act (cap.333), collectively referred to as "Exempt Non-corporate unitholders". If your Soilbuild REIT units are held through a Depository Agent, please approach your Depository Agent who will claim the refund on your behalf.
Which distributions are eligible?
This back-end refund arrangement applies to the following distributions:
- where the beneficial owner of Soilbuild REIT Units held through a Depository Agent is an individual who receives distributions (made by Soilbuild REIT on or after 4 December 2013) after tax deduction; and
- where the beneficial owner of Soilbuild REIT Units (either held through a Depository Agent or directly in the unitholder's own name) is a foreign non-individual who receives distributions (made by Soilbuild REIT during the period from 4 December 2013 to 31 March 2020 (both dates inclusive)) after tax-deduction of more than 10%.
Please note that Soilbuild REIT's first distribution after listing was made on 4 December 2013.
What must you do to make a claim?
This back-end refund arrangement applies to the following distributions:
- If you are a foreign non-individual or an Exempt Non-corporate unitholder holding Soilbuild REIT Units in your own name:
- download and complete Form R1. Use a separate Form R1 for each income distribution period.
- submit the duly completed Form R1, accompanied by the original Subsidiary Income Tax Certificate ("SITC") or the Account Statement/ Annual Dividend Statement ("ADS") issued by the Central Depository ("CDP") which reflects the distribution in respect of which the claim for refund is made, to Boardroom Corporate & Advisory Services Pte. Ltd. at 50 Raffles Place, Singapore Land Tower, #32-01, Singapore 048623.
- If you are an individual, a foreign non-individual or an Exempt Non-corporate unitholder and you hold Soilbuild REIT Units through Depository Agents, please liaise with your Depository Agent on your claim for refund. The claim will be made on your behalf by your Depository Agent.
- If you are a Depository Agent and wish to claim for refund on behalf of beneficial owners who are individuals, foreign non-individuals or Exempt Non-corporate unitholders:
- download and complete Form R2, including Annexes 1, 2 and 3. Use a separate Form R2 for each income distribution period.
- submit the duly completed Form R2, accompanied by the SITC for the distribution in respect of which the claim for refund is made, to Boardroom Corporate & Advisory Services Pte. Ltd. at 50 Raffles Place, Singapore Land Tower, #32-01, Singapore 048623.
- Email a soft copy of the completed Annexes to Boardroom Corporate & Advisory Services Pte. Ltd. at the following email address: SRS_ClientServices@boardroomlimited.com
Is identification number required on the Forms R1 or R2?
Identification number such as Singapore NRIC number, passport number or foreign identification number is required for individuals who hold their units through Depository Agents.
How often is the back-end refund arrangement?
The Manager of Soilbuild REIT will be processing the back-end refund once a year on 31 December but reserves the right to end the yearly back-end process if it is deemed to be no longer necessary with advance notice.
Time limit for claim of refund
Every claim of refund must be made to the IRAS within 4 years from the end of the year of assessment to which the claim relates. For example, for claim of refund in respect of distribution made by Soilbuild REIT for the period from 16 August 2013 to 30 September 2013 (which relates to the year of assessment 2014), the claim must be submitted to the IRAS on or before 31 December 2018. Unitholders and the Depository Agents must ensure that the relevant Forms are submitted on a timely basis to allow the Trustee of Soilbuild REIT to make the refund claim within the prescribed time limit. The IRAS will not process any claim that is out of time.
Will I get a refund if I do not submit my SITC or ADS?
The Manager of Soilbuild REIT will not process the refund if the SITC or ADS is not submitted.
When do you get your refund?
The tax refund will be paid to the Depository Agents and unitholders as soon as practicable after the receipt of tax refund from IRAS by the Trustee of Soilbuild REIT.
Will the Manager of Soilbuild REIT issue an amended tax certificate for the refund?
The Manager of Soilbuild REIT will issue a letter together with the cheque for the refund amount to the Depository Agents and unitholders who hold the units directly. This letter will serve as evidence that the tax refund has been made.
Definition of foreign non-individual
A foreign non-individual investor is defined as a non-individual who is not a resident of Singapore* for income tax purposes and:
- who does not have a permanent establishment** in Singapore; or
- who carries on any operation in Singapore through a permanent establishment** in Singapore, where the funds used to acquire Soilbuild REIT Units are not obtained from that operation.
- * A company is not a tax resident in Singapore if the management and control of its business is exercised outside Singapore during the respective calendar year in which the distribution was made and there is no intention to change the management and control of its business to Singapore.
- ** A permanent establishment is defined under the Singapore Income Tax Act as a fixed place where a business is wholly or partly carried on including a place of management, a branch, an office, a factory, a warehouse, a workshop, a farm or plantation, a mine, oil well, quarry or other place of extraction of natural resources, a building or work site or a construction, installation or assembly project. A unitholder shall be deemed to have a permanent establishment in Singapore if it:
- carries on supervisory activities in connection with a building or work site or a construction, installation or assembly project; or
- has another person acting on the unitholder's behalf in Singapore who:
- has and habitually exercises an authority to conclude contracts;
- maintains stock of goods or merchandise for the purpose of delivery on its behalf; or
- habitually secures orders wholly and almost wholly for the unitholder or for such enterprises as are controlled by the unitholder.