Tax Refund

Tax Refund

Distributions made by Real Estate Investment Trusts (“REITs”) listed on Singapore Exchange Securities Trading Limited to individuals, whether foreign or local, is tax exempt. In this respect, the Inland Revenue Authority of Singapore (“IRAS”) has confirmed that all individuals (excluding individuals who derive any distribution through a partnership in Singapore or from the carrying on of a trade, business or profession) will receive their distributions from OUE Commercial REIT (“OUE C-REIT”) without tax being deducted at source (“gross distributions”).

Individuals who derive distributions through a partnership in Singapore or from the carrying on of a trade, business or profession are not eligible for this tax exemption and are required to declare the distributions in their income tax returns, notwithstanding that gross distributions have been made to them.

In addition, REITs’ distributions to qualifying non-resident non-individual investors and qualifying non-resident funds are entitled to a reduced rate of tax of 10% for distributions made during the period from 18 February 2005 to 31 December 2025 (both dates inclusive) and 1 July 2019 to 31 December 2025 (both dates inclusive) respectively.

The Manager of OUE C-REIT (the “Manager”) has established an arrangement to allow eligible Unitholders to claim a back-end refund of tax, if any, over-deducted from income distributions made to them from the IRAS.

FAQs

BACK-END REFUND FOR INCOME DISTRIBUTION

1. Who can claim the tax over-deducted through the back-end refund process?
2. How do I make a claim of the tax withheld?
3. When do I submit Form R1 or R2?
4. Is there a time limit for the tax refund?
5. How often is the back-end-refund process?
6. How soon will I receive the tax refund?

1. Who can claim the tax over-deducted through the back-end refund process?
The back-end refund process is meant for the refund of tax which had been previously withheld at the prevailing corporate tax rate from the distributions to the following beneficial Unitholders:
  1. Individuals holding OUE C-REIT units through a Depository Agent and have received distributions after tax deduction at prevailing corporate tax rate instead of at gross; or
  2. Non-resident non-individuals1 holding OUE C-REIT units through a Depository Agent or in their own name and have received distributions after tax deduction at prevailing corporate tax rate instead of 10%. The 10% tax rate is applicable only in respect of distributions made during the period from 1 September 2014 to 31 December 2025; or
  3. Non-resident funds2 holding OUE C-REIT units through a Depository Agent or in their own name and have received distributions after tax deduction at prevailing corporate tax rate instead of 10%. The 10% tax rate is applicable only in respect of distributions made during the period from 1 July 2019 to 31 December 2025; or
  4. Exempt non-corporate Unitholders3 holding OUE C-REIT units through a Depository Agent or in their own name.
For other categories of beneficial Unitholders, they will need to claim a refund of the tax over-deducted, if any, when filing their tax return.
2. How do I make a claim of the tax withheld?
  1. If you are a qualifying non-resident non-individual, qualifying non-resident fund or an exempt corporate Unitholder holding OUE C-REIT units in your own name:
    1. Download and complete Form R1. Please use a separate Form R1 for each income distribution period.
    2. Submit the duly completed Form R1, accompanied by the original Subsidiary Income Tax Certificate ("SITC") or Annual Distribution Statements ("ADS") issued by The Central Depository (Pte) Ltd for the distribution in respect of which the claim for refund is made to the Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. at 1 Harbourfront Avenue, #14-07 Keppel Bay Tower, Singapore 098632.
  2. If you are an individual, a qualifying non-resident non-individual, a qualifying non-resident fund or an exempt non-corporate and you hold OUE C-REIT units through Depository Agents, please liaise with your Depository Agent on your claim for 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 refund on behalf of beneficial unit owners who are individuals, qualifying non-resident non-individuals, qualifying non-resident funds or exempt non-corporates:
    1. Download and complete Form R2, including Annexes 1 to 3. Please use a separate Form R2 for each income distribution period.
    2. Submit the duly completed Form R2, accompanied by the original SITC for the distribution in respect of which the claim for refund is made to the Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. at 1 Harbourfront Avenue, #14-07 Keppel Bay Tower, Singapore 098632.
    3. Please email a soft copy of the completed Annexes to Boardroom Corporate & Advisory Services Pte. Ltd. at Jolene.Ting@boardroomlimited.com.
3. When do I submit Form R1 or R2?
You may submit Form R1 and R2 with the accompanying SITCs or ADS at any time. The Trustee of OUE C-REIT and Manager will process the claim for refund from IRAS on a half yearly basis. Please use a separate form for each income distribution period.
4. Is there a time limit for the tax refund?
Every claim for tax refund must be made to the IRAS within 4 years from the end of the year of assessment to which the claim relates. For example, for the claim of tax refund in respect of distribution made by OUE C-REIT for the period from 1 January 2017 to 30 June 2017 (which relates to the Year of Assessment 2018), the claim must be submitted to the IRAS on or before 31 December 2022. Unitholders and the Depository Agents must ensure that the relevant Forms are submitted on time to allow the Trustee of OUE C-REIT to make the claim for tax refund within the prescribed time limit. For refund which will be time-barred during the year, please ensure the Forms R1 and R2 are received by the Trustee by June of that same year. The IRAS will not process any claim that has exceeded the 4-year time frame.
5. How often is the back-end refund process?
The Manager will be processing the back-end refund twice a year on 30 June and 31 December but reserves the right to end the half-yearly back-end process if it is deemed to be no longer necessary (e.g. change in legislation) with advance notice.
You will have to return the completed declaration form to the Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., 15 days before the time limit stipulated above for each back-end refund process. If the stipulated dates happen to fall on a weekend or public holiday, the deadline will be the next working day.
6. How soon will I receive the tax refund?
The tax refund will be paid to the Depository Agents and Unitholders as soon as practicable after the receipt of the tax refund from the IRAS by the Trustee of OUE C-REIT.
  1. A qualifying non-resident non-individual is one who is not a resident in Singapore for income tax purposes and:
    1. who does not have any permanent establishment in Singapore; or
    2. who carries on any operation in Singapore through a permanent establishment in Singapore, but the funds used to acquire the units in OUE C-REIT are not obtained from that operation.
  2. A qualifying non-resident fund is one who is not a resident in Singapore for income tax purposes, qualifies for tax exemption under section 13D, 13U or 13V of the Income Tax Act 1947 and:
    1. who does not have any permanent establishment in Singapore (other than the fund manager in Singapore); or
    2. who carries on any operation in Singapore through a permanent establishment in Singapore (other than the fund manager in Singapore), but the funds used to acquire the units in OUE C-REIT are not obtained from that operation.
  3. An exempt non-corporate unitholder includes:
    1. a charity registered under the Charities Act 1994 or established by any written law;
    2. a town council;
    3. a statutory board;
    4. a co-operative society registered under the Co-operative Societies Act 1979;
    5. a trade union registered under the Trade Unions Act 1940;
    6. 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 1948; or
    7. a real estate investment trust exchange-traded fund which has been accorded the tax transparency treatment.