Finance and Treasury Centre Incentive
The Finance and Treasury Centre Incentive is aimed at encouraging companies to grow treasury management capabilities and use Singapore as a base for conducting treasury management activities for the region.
• An approved finance and treasury centre (FTC) company is eligible for a reduced corporate tax rate of 8% on income derived from qualifying FTC services to approved network companies (ANCs) as well as qualifying FTC activities carried out on its account with funds obtained from qualifying sources.
• An approved FTC company is also eligible for withholding tax exemption on interest payments, such as interest on loans obtained by the approved FTC from banks, non-bank financial institutions and ANCs outside Singapore, provided the funds are used for its approved qualifying activities or services.
• The incentive period is limited to five years. Extension of the incentive may be considered, subject to the FTC company’s commitment to undertake further expansion plans on its FTC activities/services.
• The FTC company is required to maintain a separate account in respect of any non-qualifying activity undertaken during the incentive period. The income from the non-qualifying activity is not eligible for the concessionary tax rate.
• Companies with established international businesses and operations to establish your FTCs in Singapore.
• To qualify for the FTC incentive, companies must establish substantive activities in Singapore and perform strategic functions. Key activities should include control over the management of cash and liquidity position, provision of corporate finance advisory services, management of interest rate, foreign exchange, liquidity and credit risks, as well as overall business planning, investment research and analysis.