Jurisdiction - Singapore
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Singapore – GST Change Proposed For IPRs Held By Bare Trustee For Non-Legal Entities.

3 July, 2014


Legal News & Analysis – Asia Pacific – Singapore – Intellectual Property


Currently, a non-legal entity which is registered for GST is unable to claim input tax on supplies made to a bare trustee of the non-legal entity, where the legal title to any goods, intellectual property rights (IPRs), or licence to use IPRs is held by the bare trustee. The types of non-legal entities envisaged are a partnership, club, association, society or organisation. The bare trustee holds the IPRs or licence instead of the non-legal entity due to the latter’s lack of capacity. 

The draft Goods and Services Tax (Amendment) Bill 2014, which is open for public consultation until 1 July 2014, proposes certain amendments to the Goods and Services Tax Act, including changes to address the above issue. The proposed changes are prospective in nature, to take effect from 1 January 2015. 

The amendments here aim to provide for non-legal entities to claim and account for GST incurred on acquisition of IPRs among other properties, namely goods, land and buildings.
This tax change affecting IPRs is to resolve a long-standing inequity in the tax system where non-legal entities indirectly holding property such as IPRs have been unable to claim input tax on their acquisitions of these IPRs because these entities are not the legal owners of the IPRs. The tax change seeks to put non-legal entities on par with legal entities in regard to the GST implications of supplies relating to goods, IPRs and licences to use IPRs, by deeming supplies made here to and by the bare trustee on behalf of the non-legal entity to be made to and by, respectively, the non-legal entity itself. The non-legal entity is registered as a taxable person for GST. 

To meet the definition of a bare trustee in the draft Bill, a trustee needs to meet 3 conditions. These are: 

(a) the trustee holds any goods, IPRs or licence to use any IPRs, on trust either for taxable persons carrying on a business in partnership who are registered in the name of the firm, or for a taxable person that is a club, association, society or organisation registered in the name of the club, association, society or organisation, as the case may be; 

(b) the trustee has no beneficial interest in the goods, IPRs or licence; and 

(c) the trustee has no duty to perform in relation to the goods, IPRs or licence, other than to act in accordance with instructions given by the taxable persons or the taxable person, as the case may be, for any supply relating to the goods, IPRs or licence.
The proposed amendments for the above tax change include supplemental provisions, such as requiring the non-legal entity that will be able to claim input tax, to also charge and account for output tax in regard to the supplies that it is deemed to make.


The proposed change makes for a fairer tax system, and enables non-legal entities carrying on business to reduce costs in their acquisitions or use of IPRs by treating them as if they are the legal owners.


ATMD Bird & Bird


For further information, please contact:


Sundareswara Sharma, ATMD Bird & Bird

[email protected]


ATMD Bird & Bird Intellectual Property Practice Profile in Singapore


Homegrown Intellectual Property Law Firms in Singapore 


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