Urgently need answers

[fxtrader]

My work permit was canceled recently and I have a bank account in Singapore. I keep the bank account because soon I will return to Singapore to look for a new career so it will be convenient for me. I am living in Malaysia for now and soon will move back to Singapore and look for a new career under social visit pass.

Can I just check with you all, when I return to Singapore under visit pass, while I am searching for a new career, can I meantime trade forex online (as I am a forex trader back then while I was working for others under work permit before it was canceled); my question now is, can i trade forex while I get the new job in Singapore? Is it allowed or I have to come back to Malaysia to trade forex? Can I also use the income from forex in Singapore and transfer them to my current Singapore bank account?

I think that forex trading is an offshore income and I am sure it will not be a problem while I get a new work pass in Singapore.

Anyone have any experience on this please share it here, please tell me the answers.

Thank you.

[econoMIC]

You will not be facing any problems with it and you can do it online from the moon, Tuvalu or Singapore, doesn't make a difference.

[Strong Eagle]

If you are planning to declare it as offshore income then you will be paying taxes on that income somewhere else, correct?

If you derive that income in Singapore, then it would be taxable in Singapore, but you can't do that because you don't have any right to work here.

So, the question is not so simple. You make a trade in your forex account and make a profit. If you intend to transfer it to you Singapore bank, I think it would incur Sing tax.

But other traders could give a better answer.

[fxtrader]

Thanks for your reply.

I understand that offshore income generated from forex is non taxable? I am not sure of this also, anyway that is not the main issue of mine, my main issue is:

Logically speaking, I am not working in Singapore, without a work pass, forex trading can be traded anywhere in the world, so if I trade forex while in Singapore before I get a work pass, will that be any issue if I am to transfer the forex profits to my Singapore bank account?

In this case I really don't see that I break the rules of MOM, right?

Please guide me thanks!

[Strong Eagle]

a) Generally, yes, you are not working in Singapore and are under the radar.

b) Income is taxable somewhere, usually in the country of residence. Just because you are earning online, you are not exempt from tax. So, if you are not paying tax in Singapore you need to be paying it in your country of residence... and if you aren't, you are a tax cheat.

[econoMIC]

I actually spoke to IRAS and ICA a few years ago about this while I was on a student pass and not allowed to work in Singapore.

The bottom line was that as the income arose outside Singapore (non-SG bank) and it was not employment, I was free to do it (as it is not employment itself) and did not have to pay tax on it. Having said that, you will have to keep in mind the tax code wherever your broker is located. Singapore does not tax private individuals on fx gains or gains on derivatives so you can also feel free to wire your income to a Singapore bank account. This was what I did for over three years based on what I was told by ICA and IRAS from 2004 to 2007.

[fxtrader]

I actually spoke to IRAS and ICA a few years ago about this while I was on a student pass and not allowed to work in Singapore.

The bottom line was that as the income arose outside Singapore (non-SG bank) and it was not employment, I was free to do it (as it is not employment itself) and did not have to pay tax on it. Having said that, you will have to keep in mind the tax code wherever your broker is located. Singapore does not tax private individuals on fx gains or gains on derivatives so you can also feel free to wire your income to a Singapore bank account. This was what I did for over three years based on what I was told by ICA and IRAS from 2004 to 2007.

Thanks, I really appreciate your help on this topic!

[beppi]

Somehow in this kind of discussion there are always the same wrong assumptions cropping up. Please keep in mind:

Any income (all kinds, not just employment) is taxable where it is made, NOT where it is paid!
It does not matter at all for tax reasons if the money is paid into a Singapore bank account or not (or transferred afterwards), income made abroad is not taxable here.

[Strong Eagle]

Somehow in this kind of discussion there are always the same wrong assumptions cropping up. Please keep in mind:

Any income (all kinds, not just employment) is taxable where it is made, NOT where it is paid!
It does not matter at all for tax reasons if the money is paid into a Singapore bank account or not (or transferred afterwards), income made abroad is not taxable here.

The question of course, is, if you are doing online forex trading and you make a profit, where was that profit made? The home office of the broker you are using?