§ 43T — Concessionary rate of tax for ship broking and forward freight agreement trading

43T.—(1) Despite section 43, tax at the rate of 10% is to be levied and paid for each year of assessment upon such amount of —(a)

fees or commissions derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from ship broking; and

(b)

gains derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from forward freight agreement trading,

which in the aggregate are in excess of the base amount.

(2) Approval may be granted under this section between 1 April 2010 and 31 May 2011 (both dates inclusive) to a company for a period of 5 years, subject to such conditions as the Minister may impose.[37/2014]

(3) The base amount mentioned in subsection (1) is —(a)

where the approved company had carried out the ship broking or forward freight agreement trading or both (called in this paragraph such activity) in Singapore at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, the amount ascertained by dividing the net profit before tax as shown in the audited accounts of the approved company that is derived from carrying out such activity during that period by the actual number of months in that period in which such activity was carried out and multiplying by 12;

(b)

where the approved company had not carried out the ship broking or forward freight agreement trading in Singapore, at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, zero; or

(c)

such amount as the Minister may specify in substitution for the amount mentioned in paragraph (a) or (b).

(4) In determining the income of an approved company from the carrying out of ship broking or forward freight agreement trading or both in Singapore —(a)

the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and

(b)

the Comptroller must determine the manner and extent to which —(i)

allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and

(ii)

any loss may be deducted under section 37.

(5) In this section —“approved company” means a company which —(a)

is incorporated and resident in Singapore;

(b)

carries on the business of ship broking or forward freight agreement trading or both in Singapore; and

(c)

is approved by the Minister, or such person as the Minister may appoint, for the purpose of this section;

“forward freight agreement trading” means the undertaking of a position under a forward freight agreement trade where such trade is in connection with shipping freight rates;

“ship broking” means —(a)

the broking of sale and purchase of vessels (including the activity of valuing the vessels);

(b)

the matching of vessel owners (which intend to build new vessels) to shipyards based on the vessel owners’ requirements;

(c)

the matching of vessels to —(i)

cargoes; or

(ii)

vessel owners and vessel charterers;

(d)

the valuation of vessels; or

(e)

the matching of forward freight agreement traders where the forward freight agreement trade is in connection with shipping freight rates,

and includes the provision of research, consultancy or advisory services using information derived from the business of carrying on any of the activities referred to in paragraphs (a) to (e), where the total sum of the fees (called in this definition the said sum) derived by the approved company from the research, consultancy and advisory services in the basis period for the year of assessment concerned is not more than 20% of the sum of —

(f)

the total fees and commissions derived by the approved company from all of the activities referred to in paragraphs (a) to (e) in the basis period for that year of assessment; and

(g)

the said sum,

unless the Minister otherwise allows.

[43ZE

—(1) Despite section 43, tax at the rate of 10% is to be levied and paid for each year of assessment upon such amount of —(a)

fees or commissions derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from ship broking; and

(b)

gains derived in the period between 1 April 2010 and 31 May 2011 (both dates inclusive) by an approved company from forward freight agreement trading,

which in the aggregate are in excess of the base amount.

(2) Approval may be granted under this section between 1 April 2010 and 31 May 2011 (both dates inclusive) to a company for a period of 5 years, subject to such conditions as the Minister may impose.[37/2014]

(3) The base amount mentioned in subsection (1) is —(a)

where the approved company had carried out the ship broking or forward freight agreement trading or both (called in this paragraph such activity) in Singapore at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, the amount ascertained by dividing the net profit before tax as shown in the audited accounts of the approved company that is derived from carrying out such activity during that period by the actual number of months in that period in which such activity was carried out and multiplying by 12;

(b)

where the approved company had not carried out the ship broking or forward freight agreement trading in Singapore, at any time during the period of 3 years immediately preceding the date on which approval is granted under this section, zero; or

(c)

such amount as the Minister may specify in substitution for the amount mentioned in paragraph (a) or (b).

(4) In determining the income of an approved company from the carrying out of ship broking or forward freight agreement trading or both in Singapore —(a)

the allowances under section 19, 19A, 20, 21, 22 or 23 must be taken into account even if no claim for such allowances has been made; and

(b)

the Comptroller must determine the manner and extent to which —(i)

allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and donations allowable under this Act are to be deducted; and

(ii)

any loss may be deducted under section 37.

(5) In this section —“approved company” means a company which —(a)

is incorporated and resident in Singapore;

(b)

carries on the business of ship broking or forward freight agreement trading or both in Singapore; and

(c)

is approved by the Minister, or such person as the Minister may appoint, for the purpose of this section;

“forward freight agreement trading” means the undertaking of a position under a forward freight agreement trade where such trade is in connection with shipping freight rates;

“ship broking” means —(a)

the broking of sale and purchase of vessels (including the activity of valuing the vessels);

(b)

the matching of vessel owners (which intend to build new vessels) to shipyards based on the vessel owners’ requirements;

(c)

the matching of vessels to —(i)

cargoes; or

(ii)

vessel owners and vessel charterers;

(d)

the valuation of vessels; or

(e)

the matching of forward freight agreement traders where the forward freight agreement trade is in connection with shipping freight rates,

and includes the provision of research, consultancy or advisory services using information derived from the business of carrying on any of the activities referred to in paragraphs (a) to (e), where the total sum of the fees (called in this definition the said sum) derived by the approved company from the research, consultancy and advisory services in the basis period for the year of assessment concerned is not more than 20% of the sum of —

(f)

the total fees and commissions derived by the approved company from all of the activities referred to in paragraphs (a) to (e) in the basis period for that year of assessment; and

(g)

the said sum,

unless the Minister otherwise allows.

[43ZE