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Tax Refund Procedures For Unitholders
Background
Taxable income distributions made by Real Estate Investment Trusts ("REITs") listed on the Singapore Exchange to individuals, whether foreign or local, are tax exempt except where such distribution is derived by the individual through a partnership in Singapore or from the carrying on of a trade, business or profession. In this respect, the Inland Revenue Authority of Singapore ("IRAS") allows REITs to make such distributions on a gross basis (i.e. without tax deducted at source) to all individuals (excluding individuals who hold their units in the REITs through partnerships). Individuals who derived their distributions from the carrying on of a trade, business or profession are therefore not eligible for the aforesaid tax exemption and are required to declare the distributions in their income tax returns, notwithstanding that gross distributions are made to them.
In addition, taxable income distributions to certain qualifying unitholders (i.e. non-individuals) can also be made at gross (i.e. without tax deducted at source) and distributions to qualifying foreign non-individual investors and qualifying non-resident funds (collectively, “Foreign Non-Individuals”) are subject to a reduced rate of tax of 10% for distributions made on or before 31 December 2025.
In the event that tax has been wrongly deducted and accounted to the Comptroller of Income Tax (“CIT”), the CIT allows eligible unitholders to claim a refund of the tax over-deducted through the trustee and manager of the REIT.
Eligible unitholders of units in ESR-LOGOS REIT can therefore claim a tax refund from the CIT for tax that has been wrongly deducted through the trustee and manager of ESR-LOGOS REIT.
Which Unitholders Are Eligible For This Tax Refund?
Eligible Unitholders are:
- Individuals holding ESR-LOGOS REIT Units through Depository Agents; or
- Foreign Non-Individuals (see definition below) holding ESR-LOGOS REIT Units in their own name or through Depository Agents; or
- Exempt Non-Corporate Unitholders (see definition below) holding ESR-LOGOS REIT Units in their own name or through Depository Agents.
How To Make A Claim?
- 1. If you are a Foreign Non-Individual or an Exempt Non-Corporate Unitholder holding ESR-REIT Units in your own name
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A) Which Distributions Are Eligible For The Tax Refund?
For Foreign Non-Individuals, the tax refund applies to distributions made by ESR-LOGOS REIT within the period from 25 July 2006 to 31 December 2025 (both dates inclusive).
For Exempt Non-Corporate Unitholders, the tax refund applies to distributions paid or to be paid on or after 25 July 2006.
B) How To Make A Claim?
Download and complete Form R1 below. Use a separate Form R1 for each distribution period. Submit the duly completed Form R1, accompanied by the Subsidiary Income Tax Certificate ("SITC") or the Annual Dividend Statement ("ADS") issued by the Central Depository (Pte) Ltd for the distribution in respect of which the claim for refund is made, to Boardroom Corporate & Advisory Services Pte. Ltd., 1 Harbourfront Avenue, #14-07 Keppel Bay Tower, Singapore 098632.
C) When Do We Submit Form R1?
You may submit Form R1 and the accompanying SITC or ADS to Boardroom Corporate & Advisory Services Pte. Ltd. at any time.
The trustee of ESR-LOGOS REIT will collate the claims for refund submitted by Unitholders and make a claim for refund to the IRAS on a half-yearly basis (submission deadline is 30 June and 31 December). For example, all Forms received during the half-year ended 30 June 2020 will be submitted to IRAS sometime in July 2020.
D) Will An Amended Tax Certificate Be Issued For The Refund?
ESR Funds Management (S) Limited will issue a letter together with the cheque for the refund amount to the Unitholders. This letter will serve as evidence that the tax refunds have been made.
E) When Will We Receive Our Tax Refund?
The tax refund will be paid out to eligible unitholders as soon as practicable after receipt of the tax refund from IRAS by the trustee of ESR-REIT.
Download Form R1
- 2. If you are an Individual, a Foreign Non-Individual or an Exempt Non-Corporate Unitholder holding ESR-LOGOS REIT Units through Depository Agents, please liaise with your respective Depository Agent on your claim for the tax refund. The claim will be made on your behalf by your Depository Agent.
- 3. If you are a Depository Agent and wish to claim for Tax Refund on behalf of beneficial owners who are Individuals, Foreign Non-Individuals or Exempt Non-Corporate Unitholders:
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A) Which Distributions Are Eligible for Refund?
For beneficial owners who are Foreign Non-Individuals, the tax refund applies to distributions made by ESR-LOGOS REIT within the period from 25 July 2006 to 31 December 2025 (both dates inclusive).
For beneficial owners who are individuals or Exempt Non-Corporate Unitholders, the tax refund applies to distributions paid or to be paid on or after 25 July 2006.
B) How To Make A Claim?
Download and complete Form R2 below, including Annexes 1 to 3. Use a separate Form R2 for each distribution period. Submit the duly completed Form R2, accompanied by the Subsidiary Income Tax Certificate ("SITC") issued for the distribution in respect of which the claim for refund is made, to Boardroom Corporate & Advisory Services Pte. Ltd., 50 Raffles Place, #32-01 Singapore Land Tower, Singapore 048623.
Email a soft copy of the completed Annexes to Boardroom Corporate & Advisory Services Pte. Ltd. at SRS.TeamE@boardroomlimited.com.
C) Is Identification (ID) Number Required On The Declaration Form?
Yes, ID numbers such as Singapore NRIC number, passport number or foreign ID number are required for Individuals who hold their Units through Depository Agents.
D) When Do We Submit Form R2?
You may submit the Form R2 and the accompanying SITCs to Boardroom Corporate & Advisory Services Pte. Ltd. at any time.
The trustee of ESR-LOGOS REIT will collate the claims for refund submitted by the Depository Agents and make a claim for refund to the Inland Revenue Authority of Singapore ("IRAS") on a half-yearly basis (submission deadline is 30 June and 31 December). For example, all Forms received during the half-year ended 30 June 2020 will be submitted to IRAS sometime in July 2020
E) Will An Amended Tax Certificate Be Issued For The Refund?
ESR-LOGOS Management (S) Limited will issue a letter together with the cheque for the refund amount to the Depository Agents. This letter will serve as evidence that the tax refunds have been made.
F) When Will We Receive The Tax Refund On Behalf Of The Beneficial Owners?
The tax refund will be paid to Depository Agents as soon as practicable after receipt of the tax refund from IRAS by the trustee of ESR-LOGOS REIT. You can then proceed to make refunds to your respective beneficial owners.
Download Form R2
Time Limit for Claim of Refund
Every claim of refund must be made to IRAS within 4 years from the end of the year of assessment to which the claim relates. For example, for claim of refund in respect of distributions made by ESR-LOGOS REIT for the period from 1 January 2020 to 30 June 2020 (which relates to the year of assessment 2021), the claim must be submitted to IRAS on or before 31 December 2025. Unitholders and the Depository Agents must ensure that the relevant Forms are submitted on a timely basis to allow the trustee of ESR-LOGOS REIT to make the refund claim within the prescribed time limit. IRAS will not process any claim that is out of time.
Definitions
Definition of Foreign Non-Individual
A foreign non-individual investor is a person (other than an individual) who is not a resident of Singapore* for income tax purposes and:i. who does not have a permanent establishment** in Singapore; or
ii. who carries on any operation in Singapore through a permanent establishment** in Singapore, where the funds used to acquire the REIT's units are not obtained from that operation.
*A company is not a tax resident in Singapore if the management and control of its business is exercised outside Singapore during the respective calendar year in which the distribution was made and there is no intention to change the management and control of its business to Singapore.
**A permanent establishment is defined under the Singapore Income Tax Act as a fixed place where a business is wholly or partly carried on including a place of management, a branch, an office, a factory, a warehouse, a workshop, a farm or plantation, a mine, oil well, quarry or other place of extraction of natural resources, a building or work site or a construction, installation or assembly project. A person shall be deemed to have a permanent establishment in Singapore if it:
i. carries on supervisory activities in connection with a building or work site or a construction, installation or assembly project; or
ii. has another person acting on the Unitholder's behalf in Singapore who:
a. has and habitually exercises an authority to conclude contracts;
b. maintains stock of goods or merchandise for the purpose of delivery on its behalf; or
c. habitually secures orders wholly and almost wholly for the Unitholder or for such enterprises as are controlled by the Unitholder.
Definition of Exempt Non-Corporate Investor
An exempt non-corporate investor is one who is:
i. a charity registered under the Charities Act (Cap. 37) or established by any written law; or
ii. a town council; or
iii. a statutory board; or
iv. a co-operative society registered under the Co-operative Societies Act (Cap. 62); or
v. a trade union registered under the Trade Unions Act (Cap. 333); or
vi. an international organisation that is exempt from tax on such distributions by reason of an order made under the International Organisations (Immunities and Privileges) Act (Cap. 145); or
vii. a real estate investment trust exchange-traded fund which has been accorded the tax transparency treatment.