What is Overseas vendor registration regime?
With effect from 1 January 2020, GST will be applied to cross-border Business-to-Customer (B2C) supplies (such as supplies made to individuals and businesses that are not registered for GST in Singapore) of imported digital services through the overseas vendor registration (OVR) regime. This is to level the playing field in GST treatment for both local and overseas services.
According to the IRAS guidelines, ‘digital services’ are services provided over the internet or an electronic network, where the distribution is automated and requires minimal or no human intervention, and is impossible without the use of IT. These include digital products, subscription-based and licensed content, and support services to arrange or facilitate, via electronic means, the provision of transactions that may not be digital in nature.
Under the OVR regime, any supplier belonging outside Singapore that has a global turnover more than S$1million and makes B2C supplies of digital services to customers in Singapore exceeding S$100,000 is required to register, charge and account for GST under a simplified pay-only regime on a quarterly basis.
Under certain circumstances, a local or overseas electronic marketplaces operator may be regarded as the supplier of the services made by the suppliers through these marketplaces, and hence, they are required to register, charge and account for GST on these supplies, instead of the suppliers.
Compulsory GST registration on imported services
An overseas supplier, local or overseas electronic marketplace operator will be liable for GST registration within 30 days at the end of the relevant calendar year or making the forecast, under either the retrospective or prospective basis, if the following conditions are met: