Scope of these five pages
This is the 2023 change from 7% to 8%, for local suppliers, OVR B 2 C digital-service suppliers and reverse-charge businesses. It says the transition principles also apply to 2024’s 8%–9% change, but its exact rates and January 2023 dates are historical, not today’s general invoice deadlines.
Example 1: delivery before, invoice after
Goods delivered 26 December 2022, invoiced 3 January 2023 and paid 10 January ordinarily attract 8%. Elect 7% because fully delivered before change; no prior approval, but preserve evidence. If already invoiced at 8%, credit excess by 15 January or cancel/reissue at 7%. Where unable to meet that date, the stated concession permits credit/new invoice within ninety days after the ORIGINAL invoice date.
Pre-change invoices and adjustment timing
A 7% tax invoice before change, with payment and delivery/performance afterwards, needs credit and new 8% invoice by 15 January 2023. For a non-tax invoice, such as a consumer receipt, adjust through normal business practice. Additional output tax is accounted at earliest of new part-invoice, receipt of part-payment or 15 January, rather than delaying to any later credit-note date.
Example 2: full payment after change
A 14 December invoice for S$1,000 services, S$200 performed before change and S$800 afterwards, is fully paid 4 January. Apply 8% to lower of post-change payment S$1,000 and performance S$800: S$800. Credit S$856 (800+56) and invoice S$864 (800+64) by 15 January. In issue period, standard-rated value falls/rises by 800 with zero net value; output tax falls 56/rises 64, net +S$8. Alternatively cancel the full old invoice and reissue separately at 7% and 8%.
Example 3: payments straddle change
Same S$1,000 invoice: before change pay 500/perform 200; after pay 500/perform 800. New rate applies to lower post-change figure S$500. Credit S$535 and invoice S$540 by 15 January; standard-rated value −500/+500 nets zero, output tax −35/+40 nets +S$5. It is not 8% on all S$800 post-change work.
Example 4: reverse-charge service before change
Imported services performed 21 December, invoice 11 January and paid 23 January ordinarily require 8% reverse charge. Elect 7% for fully pre-change service without prior approval; retain election/service evidence. For pre-change RC invoices, extra output tax arises at earlier of payment or 15 January. If using end-of-longer-period RC election, consult the full guide for that period’s treatment.
Example 5: reverse-charge invoice before change
Overseas supplier invoices S$1,000 on 3 December, performs S$300 on 15 December and balance 700 afterchange; paid 5 January. Original invoice accounts 7% on 1,000 in December period. Transition charges 8% on lower of post-change payment 1,000/performance 700, so additional 700×1%=S$7 is accounted in the period containing 5 January. Keep invoice, payment and delivery evidence together.
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 ↗