Domestic customers: charge 9 % GST
A Singapore SaaS company registered for GST charges 9 percent on subscriptions sold to customers in Singapore. The invoice must be a valid tax invoice, with the supplier's GST registration number and the customer's details, issued within 30 days of the supply.
Registration is compulsory when taxable turnover passes the S$1 million threshold, and zero-rated sales count towards it. A SaaS company with mostly overseas customers can therefore cross the threshold without charging any GST, and may need to register before it expects to. Sales taxes on software differ widely by country, so a SaaS company should list every country where it has customers and mark each as business-only, consumer or both.
Registering voluntarily lets you recover input tax on cloud costs, contractors and equipment, which matters for a company that spends heavily before revenue arrives.
Check the GST treatment of any bundled service. A subscription that includes onboarding or training may have a different treatment for each element. Always show the GST registration number and the words Tax Invoice on invoices to Singapore customers, because the customer needs them to claim input tax.
Overseas business customers: zero-rating conditions
Under the GST Act, services supplied to an overseas business customer can be zero-rated if they fall within the international services provisions and certain conditions are met. The customer must belong outside Singapore and the service must not directly benefit a person in Singapore.
Evidence matters. Keep the customer's company registration details, the contract showing the contracting entity abroad and the invoice address. A customer email signature is not evidence of belonging. Business registers in many countries are searchable online, so a screenshot or extract dated at signup is easy to keep.
If a customer has an affiliate or a branch in Singapore that uses the service, the position can change. Ask in the onboarding form who the users are and where they are.
Record the reason for zero-rating on each customer file and review it when the contract is renewed.
Consumers abroad and registration elsewhere
Selling to consumers in other countries can create registration duties there. The European Union, for example, requires non-EU providers of digital services to consumers to register for VAT through its one-stop scheme. Many other countries have similar rules, with their own thresholds.
Singapore itself taxes overseas vendors who supply digital services to Singapore consumers under the Overseas Vendor Registration regime, once defined thresholds are exceeded. The rules apply to foreign companies selling into Singapore, not to your exports, but they show what other countries do. Singapore's regime for overseas vendors is administered by IRAS and applies once thresholds on global turnover and Singapore consumer sales are passed.
Decide early whether you sell to consumers. A business-only model with a check on business status at signup avoids most foreign registration problems.
Check each target country's rules with a local adviser before you launch there.
Foreign-currency invoices and revenue records
Invoicing in US dollars or euros is normal. Where GST applies, the GST amount must be shown in Singapore dollars, using a rate IRAS accepts. For zero-rated invoices, you still report the supply in Singapore dollars in your return, so you need a consistent conversion method. IRAS accepts several rate sources, so choose one, apply it consistently and note it in your accounting policy.
For the books, record revenue at the rate on the transaction date, and revalue foreign-currency receivables at the period end. Exchange differences go to profit and loss. Write the policy down and apply it every month.
Subscription revenue is usually recognised over the subscription period. Annual prepayments create deferred revenue at the start, which the accountant releases monthly. Keep a schedule by customer, so churn and refunds are traceable. Deferred revenue also affects cash planning: an annual prepayment is cash now but revenue over twelve months.
Refunds and credit notes in foreign currency need the original rate, so keep it on the credit note.
Withholding tax and customer payments
Some countries withhold tax from payments to foreign software providers, treating subscription fees as royalties or technical fees. The treaty between that country and Singapore may reduce the rate, and your certificate of residence from IRAS is the usual evidence.
Include a clause in the contract stating whether prices are exclusive of withholding tax and whether the customer must gross up. Without it, a customer will often deduct tax and pay you less than the invoice.
Payment processors deduct fees, and some convert currency at their own rate. Record the gross invoice, the fee and the net deposit as three figures so reconciliation is possible.
Ask the customer for the withholding certificate each time, since you need it to claim a foreign tax credit. A customer who refuses to provide the certificate may still owe you the gross amount under the contract, so escalate through the account manager.
What 4b2b.net does and does not do
4invoices.net creates PDF invoices with the GST treatment you enter and keeps an invoice archive, and 4softerp.net is a multi-company financial ERP for your own bookkeeping across entities.
Neither decides zero-rating by customer country, delivers invoices over Peppol, applies IRAS-accepted daily exchange rates or keeps a dedicated gain and loss ledger for foreign currency. Those decisions and records remain with you and your accountant.
Keep a customer table with country, business or consumer status, contracting entity, billing currency, GST treatment and the reason for it. A single table prevents the same decision being re-argued for each invoice.
Review the table when a customer changes entity, relocates or upgrades, since those are the moments when the original treatment stops being right.
