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Tax

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Taxability of gains arising from the disposal of an asset – the presence of “an intention to trade”Featured

It is trite that income tax in Singapore is only chargeable on gains of an income nature, and not on gains of a capital nature. The question in every case is whether a gain is income or capital in nature. The paramount factor in determining whether a gain is of a capital or revenue nature is the objectively-determined intention of the taxpayer (i.e. whether he has an intention to trade) at the time of acquisition of the asset.

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A prima facie case of reasonable suspicion?

The extent of Comptroller of Income Tax’s (Comptroller) powers in dealing with requests from foreign tax authorities under Singapore’s exchange of information (EOI) regime was recently challenged in the High Court case of AXY and others v Comptroller of Income Tax (Attorney-General, intervener) [2017] SGHC 42. The applicant taxpayers sought leave to commence judicial review of the Comptroller’s decision to issue notices to various banks in Singapore to seek information to fulfil the requests made by the National Tax Service of the Republic of Korea (NTS) under the EOI regime.

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Director of Income Tax v. KLM Royal Dutch Airlines

The interpretation of air transport articles in double tax avoidance agreements (DTAA) was clarified by the High Court of Delhi in the Indian case of Director of Income Tax v. KLM Royal Dutch Airlines LNIND 2017 DEL 292. The taxpayers in this case are international airlines, Lufthansa and KLM. Both taxpayers are members of the International Airlines Technical Pool (IATP) and had extended technical facilities to other member airlines at the New Delhi airport and other Indian airports.

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Partnerships
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Income earned through partnerships

Where an individual taxpayer carries on business both as a sole-proprietor and through a “partnership”, does the income of the partnership add to the individual’s taxable turnover for GST registration purposes? The UK First-Tier Tribunal (Tax Chamber) (FTT) in Dean Jason Butler v HMRC [2016] UKFTT 0666 (TC) rejected the taxpayer’s argument that part of his income was earned through a “partnership” and found him liable to register for VAT based on his combined income.

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