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Relief from Double Taxation: The “Subject to Tax” and Similar Terms in Singapore’s Domestic Tax Law and Tax Treaties

The terms “subject to tax”, “tax paid”, and “tax payable” are found in the domestic tax and treaty provisions of Singapore that grant relief from double taxation. This paper focuses on companies and makes three submissions. First, income would be “subject to tax” in a treaty scenario as long as it was included in computing the tax liability of the company concerned; actual tax assessed is not a requirement. Second, “tax paid” and “tax payable” differ in meaning, although practice in effect interprets either term more widely as “tax has been paid or will be paid”. Third, the term “liable to tax”, discussed in the context of treaty provisions based on OECD Article 4(1), must be read liberally to give effect to the terms of those treaties.