The January 2026 third edition
This ten-page guide explains section 21A/regulation 106 zero-rating for prescribed tools and machines kept in Singapore to manufacture goods for an overseas customer, plus section 33A agency for importing the customer’s equipment. An overseas customer belongs outside Singapore and is either not GST-registered or registered only as an OVR pay-only person.
Why a retained tool is ordinarily a local supply
Manufacturers may separately supply masks, moulds, dies or prototypes and finished goods to protect customer intellectual property. A tool retained here is ordinarily a taxable local supply, even though finished goods are later exported. Repair/modification and locally destroyed prototypes are also ordinarily taxable. The conditional relief therefore addresses the tool supply itself rather than assuming the tool was physically exported.
Prescribed equipment and directly related services
Equipment must be integral to manufacturing and highly customised or specialised solely for particular goods for the overseas customer. Tools include moulds, jigs, patterns, templates, dies, punches and similar equipment. Relief can cover separately supplied prototypes and directly connected repairs/modifications to the qualifying equipment located here.
All seven zero-rating conditions
The overseas customer contracts you to make or buy the equipment; you or an approved person uses it for that customer’s manufacture; no other person can use, consume or have it made available locally; tools/prototypes are separately supplied from finished goods; more than 50% of manufactured goods are exported with evidence; tools are exported, disposed of or destroyed when no longer required; and local disposal/destruction at customer instruction or through spoilage has documentary support.
The export condition and ACMT alternative
Where goods are not yet manufactured/exported at tool supply, a contract or other documentation must demonstrate intended export manufacture. An approved ACMT contract manufacturer delivering locally to another ACMT person can satisfy the export condition where all scheme requirements and records are met. More than 50% is not the same as at least 50%.
Related manufacturer: all three additional conditions
In the ABC/DEF example, ABC contracts with the foreign customer then subcontracts to related Singapore DEF. DEF charges GST on its local tool supply to ABC if registered; ABC can zero-rate onward only where section 6 Companies Act related-company status, ABC’s sales-office role for tools AND goods, and joint accountability for equipment are present, in addition to the main conditions. The local manufacturer’s invoice is not itself zero-rated by association.
Importing equipment owned by the customer
A section 33A local-manufacturer agent imports customer-owned equipment that will later be returned, disposed of or destroyed. MES/ACMT import-suspension status may suspend GST; otherwise claim eligible import GST in the return corresponding to import date. The Guide on Imports supplies further agency conditions; ownership and agency must not be confused with a purchase by the manufacturer.
Three disposal outcomes and evidence
Paid local disposal/destruction is the agent’s standard-rated supply on consideration. Export back is reported as zero-rated with export records. No-consideration destruction/disposal needs no GST-return entry for the tool but still needs evidence. Keep export records for tools AND manufactured goods and disposal instructions, scrap records, waste-vendor invoices or photographs as applicable.
Failure after zero-rating
If conditions in sections 4 or 5.3 later fail, pay omitted GST on the supply value in GST F5 for the period in which non-compliance is realised. The guide says GST F7 is not needed for this particular adjustment, and penalties may apply. The 2019 edition added the OVR customer definition; January 2026 adds export-document cross-references.
Official source
This article independently explains the substantive contents of the official PDF, including the relevant conditions, procedures and annexes. The linked document remains the authoritative source for its original wording, and later changes should be checked separately.
Read the official PDF ↗