Question

Good Life Pte Ltd (Good Life) has been carrying on a business in Singapore of selling health supplements from Australia since 1 February 2014. It obtained its Goods and Services Tax (GST) registration on 1 July 2015. For the quarter ended 30 September 2018, it carried out the transactions listed in (a) through (d) below. All amounts are exclusive of GST, unless otherwise stated. For each of the following transactions, explain the GST treatment from the perspective of Good Life Pte Ltd and, where applicable, compute the amount of input or output GST for the quarter ended 30 September 2018. In relation to output tax implications, please identify the place of supply and the basis for your answer in addition to identifying the type of supply made. In respect of input tax implications, please identify the type of supply and whether input tax credit is available, stating the basis for your answer.

(a) Good Life has a few retail outlets throughout Singapore. Customers from Malaysia came to Good Life’s Singapore outlets and placed orders worth $45,000. They requested that Good Life arrange for the goods purchased to be couriered to their Malaysian residence. Alternatively, the Malaysian customers can take the goods home themselves. (4 marks)

(b) Good Life imported health supplements from Australia at a cost of $60,000, excluding freight and insurance of $5,000. Staff of Good Life had to attend a course conducted by the Australian supplier via Skype. The course was to educate distributors on the health benefits of the latest batch of supplements. The Australian supplier billed Good Life $2,000 for the course and $65,000 for the health supplements sold to Good Life. (4 marks)

(c) Good Life owns a residential property in Singapore, which is leased to a foreigner working in Singapore at a monthly rental of $3,000. The property is fully furnished and includes movable furniture. The annual value of the property is $24,000. During the quarter, Good Life had to incur $5,000 to repair a water leakage in the master bathroom. The repair works were carried out by a GST registered company. (6 marks)

(d) Paid $10,000 to a GST registered supplier for two new MacBooks and accessories. One of the MacBooks is used by the sales and marketing team for official work while the other was given away to a staff member as reward for excellent performance. (6 marks)

Answer 1

a	Place of Suppply-Singapore
	Ownership of Goods is transfer in singapore,goods physically located in singapore
	Output GST=	$45000*7%	3150
b.1	For Goods
	GST is chargeable on all imported goods,regardless of whether the importer is GSTregistered or not
	GST charge on value of import and value of import is CIF(cost,insurance and freight)
	Cost of goods	60000
	Insurance and freight	5000
	CIF value	65000
	Custome duty(Assume Zero)	0
	Value of import	65000
	Output GST @7%	4550
b.2	Import of service is not taxable in Singapore GST

c.1,For residential property which is used as home office (for example,Small Office2 ),the taxability of the property will depend on the approved use of the building granted by the relevant authorities,If the building is approved for "residential use",the such and lease of the property will be exempt.However,if the building is approved for non-residential use such as "office use",the sale and lease of the property will be taxable.

Hence we assume approved for "Residential use"

c.2.The input tax claimable included the GST incurred on the purchase price,rental,maintenance or service charges,purchase of furniture and fittings,renovation and repairs,conveyance fees,etc

Input Tax=5000*7%=350

d.Claim input tax on both

for staff-Gifts for free(for example,to your customer or your staff),You can claim the GST incurred on thegifts as input tax,provided that all the conditions for claiming input tax are met.