§ 43H — Concessionary rate of tax for income derived from debt securities

43H.—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon —(a)

interest derived by any company from any qualifying debt securities;

(aa)

discount derived by any company from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(ab)

any amount payable to any company from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(ac)

any early redemption fee or redemption premium derived by any company from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and[Act 30 of 2023 wef 15/02/2023]

[Act 30 of 2023 wef 30/10/2023]

(ad)

such other income derived by any company that is directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations.[37/2014; 34/2016; 45/2018; 41/2020]

(2) Subsection (1)(a), (aa), (ab), (ac) or (ad) (as the case may be) does not, unless otherwise approved by the Minister or an authorised body, apply to —(a)

any interest derived from any qualifying debt securities issued during the period from 10 May 1999 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(b)

any discount from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(c)

any amount payable from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028;[Act 30 of 2023 wef 30/10/2023]

(d)

any early redemption fee or redemption premium from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and[Act 30 of 2023 wef 15/02/2023]

[Act 30 of 2023 wef 30/10/2023]

(e)

such other income directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations,

where 50% or more of those securities which are outstanding at any time during the life of the issue is beneficially held or funded, directly or indirectly, by related parties of the issuer of those securities and where such income is derived by —

(f)

any company which is a related party of the issuer of those securities; or

(g)

any company where the funds used by such company to acquire those securities are obtained, directly or indirectly, from any related party of the issuer of those securities.[37/2014; 45/2018; 41/2020]

[Act 41 of 2020 wef 06/12/2022]

(2A) Subsection (1) does not apply to income from qualifying debt securities derived by a financial sector incentive (standard tier) company.

(2B) Subsection (1) does not apply to income derived by a financial sector incentive (capital market) company from qualifying debt securities on or after 1 January 2014.[45/2018]

(3) Regulations made under subsection (1) may provide for exemption from tax of income derived by a primary dealer from trading in any Singapore Government securities during the period from 27 February 1999 to 31 December 2028 (both dates inclusive), and for deduction of losses otherwise than in accordance with section 37(3).[37/2014; 45/2018; 41/2020]

[Act 30 of 2023 wef 30/10/2023]

(3AA) Regulations made under subsection (1) —(a)

to provide that tax at the rate of 10% is to be levied and paid on income mentioned in that subsection that is derived from any qualifying debt securities issued between 1 January 2024 and 31 December 2028 (both dates inclusive); and

(b)

to provide for exemption from tax of income derived by a primary dealer from trading in any Singapore Government securities between 1 January 2024 and 31 December 2028 (both dates inclusive),

that are made in connection with the amendments to subsections (1)(aa), (ab) and (ac) and (3) by section 36(a) of the Income Tax (Amendment) Act 2023, may be made to take effect from (and including) 1 January 2024.

[Act 25 of 2025 wef 08/12/2025]

(3AB) Regulations made to amend any regulations made for the purposes of subsection (1) to replace the terms “break cost” and “prepayment fee” with the term “early redemption fee”, that are made in connection with section 36(b), (c) and (d) of the Income Tax (Amendment) Act 2023, may be made to take effect from (and including) 15 February 2023.[Act 25 of 2025 wef 08/12/2025]

(3A) A primary dealer mentioned in subsection (3) may elect in accordance with subsection (3B) not to be subject to the regulations made under subsection (1); and if the primary dealer so elects, the regulations cease to apply to the income of that primary dealer for the year of assessment for which the election is made and for subsequent years of assessment.[37/2014]

(3B) The election mentioned in subsection (3A) must be made by the primary dealer by written notice to the Comptroller —(a)

at the time of lodgment of the return of income for a year of assessment; or

(b)

at such further time as the Comptroller may allow.[37/2014]

(3C) The election made by a primary dealer under subsection (3A) is irrevocable.[37/2014]

(4) In this section —[Deleted by Act 30 of 2023 wef 15/02/2023]

“debt securities” means bonds, notes, commercial papers, treasury bills, certificates of deposits, and AT1 instruments within the meaning of section 10I(2);

“early redemption fee”, “financial institution”, “qualifying debt securities” and “redemption premium” have the meanings given by section 13(16);[Act 30 of 2023 wef 15/02/2023]

“financial sector incentive (capital market) company” means a company approved as such under section 43J;

“financial sector incentive (standard tier) company” means a company approved as such under section 43J;

“Islamic debt securities” means debt securities and trust certificates —(a)

which are endorsed by any Shari’ah council or body, or by any committee formed for the purpose of providing guidance on compliance with Shari’ah law; and

(b)

the amounts payable from such securities and trust certificates are periodic and supported by a regular stream of receipts from underlying assets;

“primary dealer” means any financial institution appointed by the Monetary Authority of Singapore as a primary dealer under section 29A of the Government Securities Act 1992;

“Singapore Government securities” means debt securities issued under the Government Securities Act 1992, the repealed Local Treasury Bills Act 1923, the Significant Infrastructure Government Loan Act 2021 or by the Government under any other written law, and is deemed to include any issue of bills and notes by the Monetary Authority of Singapore that are approved by the Minister for the purposes of this Act;[Act 35 of 2021 wef 31/01/2022]

“trust certificates” means certificates evidencing beneficial ownership in underlying assets.[37/2014; 45/2018; 32/2019; 15/2021]

(5) Subsections (1)(a), (aa), (ab), (ac) and (ad) and (2) and regulations made under any of those provisions apply to a body of persons for the year of assessment 2010 and subsequent years of assessment.[43N

—(1) Despite section 43, the Minister may by regulations provide that tax at the rate of 10% is to be levied and paid for each year of assessment upon —(a)

interest derived by any company from any qualifying debt securities;

(aa)

discount derived by any company from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(ab)

any amount payable to any company from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(ac)

any early redemption fee or redemption premium derived by any company from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and[Act 30 of 2023 wef 15/02/2023]

[Act 30 of 2023 wef 30/10/2023]

(ad)

such other income derived by any company that is directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations.[37/2014; 34/2016; 45/2018; 41/2020]

(2) Subsection (1)(a), (aa), (ab), (ac) or (ad) (as the case may be) does not, unless otherwise approved by the Minister or an authorised body, apply to —(a)

any interest derived from any qualifying debt securities issued during the period from 10 May 1999 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(b)

any discount from any qualifying debt securities issued during the period from 17 February 2006 to 31 December 2028 (both dates inclusive);[Act 30 of 2023 wef 30/10/2023]

(c)

any amount payable from any Islamic debt securities which are qualifying debt securities, and issued during the period from 1 January 2005 to 31 December 2028;[Act 30 of 2023 wef 30/10/2023]

(d)

any early redemption fee or redemption premium from qualifying debt securities issued during the period from 15 February 2007 to 31 December 2028 (both dates inclusive); and[Act 30 of 2023 wef 15/02/2023]

[Act 30 of 2023 wef 30/10/2023]

(e)

such other income directly attributable to qualifying debt securities issued on or after a prescribed date, as may be prescribed by regulations,

where 50% or more of those securities which are outstanding at any time during the life of the issue is beneficially held or funded, directly or indirectly, by related parties of the issuer of those securities and where such income is derived by —

(f)

any company which is a related party of the issuer of those securities; or

(g)

any company where the funds used by such company to acquire those securities are obtained, directly or indirectly, from any related party of the issuer of those securities.[37/2014; 45/2018; 41/2020]

[Act 41 of 2020 wef 06/12/2022]

(2A) Subsection (1) does not apply to income from qualifying debt securities derived by a financial sector incentive (standard tier) company.

(2B) Subsection (1) does not apply to income derived by a financial sector incentive (capital market) company from qualifying debt securities on or after 1 January 2014.[45/2018]

(3) Regulations made under subsection (1) may provide for exemption from tax of income derived by a primary dealer from trading in any Singapore Government securities during the period from 27 February 1999 to 31 December 2028 (both dates inclusive), and for deduction of losses otherwise than in accordance with section 37(3).[37/2014; 45/2018; 41/2020]

[Act 30 of 2023 wef 30/10/2023]

(3AA) Regulations made under subsection (1) —(a)

to provide that tax at the rate of 10% is to be levied and paid on income mentioned in that subsection that is derived from any qualifying debt securities issued between 1 January 2024 and 31 December 2028 (both dates inclusive); and

(b)

to provide for exemption from tax of income derived by a primary dealer from trading in any Singapore Government securities between 1 January 2024 and 31 December 2028 (both dates inclusive),

that are made in connection with the amendments to subsections (1)(aa), (ab) and (ac) and (3) by section 36(a) of the Income Tax (Amendment) Act 2023, may be made to take effect from (and including) 1 January 2024.

[Act 25 of 2025 wef 08/12/2025]

(3AB) Regulations made to amend any regulations made for the purposes of subsection (1) to replace the terms “break cost” and “prepayment fee” with the term “early redemption fee”, that are made in connection with section 36(b), (c) and (d) of the Income Tax (Amendment) Act 2023, may be made to take effect from (and including) 15 February 2023.[Act 25 of 2025 wef 08/12/2025]

(3A) A primary dealer mentioned in subsection (3) may elect in accordance with subsection (3B) not to be subject to the regulations made under subsection (1); and if the primary dealer so elects, the regulations cease to apply to the income of that primary dealer for the year of assessment for which the election is made and for subsequent years of assessment.[37/2014]

(3B) The election mentioned in subsection (3A) must be made by the primary dealer by written notice to the Comptroller —(a)

at the time of lodgment of the return of income for a year of assessment; or

(b)

at such further time as the Comptroller may allow.[37/2014]

(3C) The election made by a primary dealer under subsection (3A) is irrevocable.[37/2014]

(4) In this section —[Deleted by Act 30 of 2023 wef 15/02/2023]

“debt securities” means bonds, notes, commercial papers, treasury bills, certificates of deposits, and AT1 instruments within the meaning of section 10I(2);

“early redemption fee”, “financial institution”, “qualifying debt securities” and “redemption premium” have the meanings given by section 13(16);[Act 30 of 2023 wef 15/02/2023]

“financial sector incentive (capital market) company” means a company approved as such under section 43J;

“financial sector incentive (standard tier) company” means a company approved as such under section 43J;

“Islamic debt securities” means debt securities and trust certificates —(a)

which are endorsed by any Shari’ah council or body, or by any committee formed for the purpose of providing guidance on compliance with Shari’ah law; and

(b)

the amounts payable from such securities and trust certificates are periodic and supported by a regular stream of receipts from underlying assets;

“primary dealer” means any financial institution appointed by the Monetary Authority of Singapore as a primary dealer under section 29A of the Government Securities Act 1992;

“Singapore Government securities” means debt securities issued under the Government Securities Act 1992, the repealed Local Treasury Bills Act 1923, the Significant Infrastructure Government Loan Act 2021 or by the Government under any other written law, and is deemed to include any issue of bills and notes by the Monetary Authority of Singapore that are approved by the Minister for the purposes of this Act;[Act 35 of 2021 wef 31/01/2022]

“trust certificates” means certificates evidencing beneficial ownership in underlying assets.[37/2014; 45/2018; 32/2019; 15/2021]

(5) Subsections (1)(a), (aa), (ab), (ac) and (ad) and (2) and regulations made under any of those provisions apply to a body of persons for the year of assessment 2010 and subsequent years of assessment.[43N