top of page
  • Writer's pictureChoon Ng

Is recovery of expenses subject to GST?

In an attempt to update and clarify on this mind-boggling GST issue, the IRAS has released a 40 page e-Tax Guide aptly titled "Guide on Reimbursements and Disbursements of Expenses".

40 pages, I hear you say?

Ok, here's a quick summary: A reimbursement of expenses is subject to GST while a disbursement is not. The e-Tax guide lays down the differences between these two and provides numerous practical examples on reimbursements versus disbursements.

Some of the common issues finally explained include whether:

- Compensations are subject to 7% GST.

- You are allowed to claimed "blocked" expenses (e.g. private medical expenses) if they are subsequently on-charged to a related company.

The e-Tax guide may, however, prove daunting to some especially if you do not deal with GST on a daily basis. This is especially so when it comes to the section where the IRAS further dichotimizes a reimbursement into whether it is ancillary to a primary supply or not. Now, that is the part where you may want to hit the "snooze" button as it becomes difficult to comprehend. Notwithstanding the above, this e-Tax guide represents a valiant effort by the IRAS to educate GST-registered businesses on a common issue faced by many businesses.

If you have any questions, please feel free to reach us at 6652 5509 or drop us an email with your questions to

25 views0 comments

Recent Posts

See All

GSTax Consultancy featured in "Best in Singapore"

We chanced upon this feature and would like to thank the team at "Best in Singapore" for their vote of confidence and kind recognition. A

GST returns extended from 30 Apr to 11 May 2020

In light of the latest measures that the government has introduced to combat COVID-19 last week, the filing due date for all GST returns due in Apr 2020 will be automatically extended to 11 May 2020.

IRAS releases new video on input tax

Common errors on input tax claims explained using an info video from IRAS Around 3,000 GST-registered businesses are selected by the IRAS for audit every year. The most common mistakes discovered are

bottom of page