Elon who manages and runs a very successful electronics company in the USA, is determined to establish a new business venture in South East Asia. The new business will develop new AI products. It is to be a separate business from the current activities carried out in the USA.

An unlisted public company is created in Singapore and the shareholders are the parent company in Texas, USA. The company has two local Singaporeans as directors and $1$ other who will be the managing directors of the company.

The two local directors $($the company$$s lawyer and accountant$)$ explain that they are required to look after the interest of the local company and not merely follow what Head Office says.

All Board meetings are to be held in Singapore where possible $($but must be at local USA time$)$ to coincide with the USA parents board meetings.

The managing director of the Singaporean company will be Guy Ritchie, a South African citizen who was handpicked by Elon.

His role is to manage the business from Singapore as well as travel around SE Asia to develop customers and research$/$development centres. In the budget it is estimated he will spend at least $200$ days a year outside Singapore.

His contract of employment and employment pass is dated $3$ October $2023$ and his contract is for $30$ months to $3$ April $2026.$ As he still has commitments in South Africa he asks that $25\%$ of his salary be paid into his South African bank account and the balance into his Singapore bank account.

Because of his travel commitments around SE Asia, he cannot always be in Singapore for the monthly board meetings.

Out of the annual meetings $7$ are held when he is outside of Singapore.

In $3$ of the meetings held the two local directors disagree with the resolutions but are over ruled by Head office.

In this question you are asked to focus on the Singapore tax issues only.

Required:

Advise the managing director of:

Is the company a resident of Singapore?

What are the consequences if the company is a nonresident of Singapore?

Advise Guy:

if he is a resident of Singapore for the time he is here

is he subject to income tax on all of his employment income?

Answer rating: 100% (QA)

Answer Based on the provided information the companys residency status in Singapore depends on facto... View the full answer