Customer accounting for certain prescribed goods will be implemented from 1 Jan 2019 to deter fraud schemes where the seller absconds with the GST collected, but businesses further down the supply chain continue to claim the input tax. It will apply to supplies of mobile phones, memory cards and off-the-shelf software, which are commonly used in these fraud schemes.

Under customer accounting, the responsibility to account for output tax on the sales shifts from the supplier to the customer. As a supplier, you are required to apply customer accounting on your local sale of prescribed goods made to a GST-registered customer if the value of your sale (excluding GST) exceeds $10,000. For this illustration, a local sale of prescribed goods that is subject to customer accounting will be referred to as a “relevant supply.”

If you make a relevant supply, your GST-registered customer will account for the output tax on this supply on your behalf. You must issue a customer accounting tax invoice to your customer to show that you will not collect the GST chargeable on this supply and that your customer will account for it instead.

If you receive a relevant supply (i.e., you are the customer), you will account for the output GST chargeable on the purchase, on behalf of your supplier. You will also able to claim the input tax on this purchase if it is for your business use and the making of your taxable supply.

The prescribed goods are mobile phones, memory cards and off-the-shelf software.

Mobile Phone

  1. It can transmit and receive spoken messages over a cellular network (whether or not it has any other function);
  2. It has a screen size of 17.5cm or less, measured diagonally from the top corner to a bottom corner, excluding the bezel. It excludes a mobile phone sold with a mobile subscription plan; and
  3. Examples: smartphone, blackberry and tablet that can transmit and receive spoken messages over a cellular network and has a screen size of 17.5cm or less

Memory Card

  1. It is an electronic flash memory data storage device used for storing digital information and excludes any flash drive with an integrated USB interface.
  2. Examples: CompactFlash, secure digital card and memory stick. of memory cards that are prescribed goods for customer accounting:

Off-the-Shelf Software

  1. It is not customised for a particular customer;
  2. the software is stored in a CD or similar storage medium which is provided as part of the supply; and
  3. the software may be accessed by the use of a product key, license key, activation code or another similar key/code that is provided in or on a physical packaging as part of the supply.
  4. Examples: anti-virus software sold in a boxed package, accounting software sold in a boxed package, electronic design automation software sold in a disc and Xbox or PlayStation games software sold in a disc. It excludes any software that is pre-loaded into any machinery or equipment (including computer) and supplied as part of the machinery or equipment.

A back-up copy of software stored in a CD or similar storage medium that is provided to the customer and software downloadable from the Internet which is accessed by a product key or license key sent to the customer via email are not ‘off-the-shelf software’ for customer accounting purposes.

The excepted supplies that are not subject to customer accounting are:

  1. A supply of goods made under the Gross Margin Scheme;
  1. A supply of goods made under the Approved Third Party Logistics Company Scheme or Approved Refiner and Consolidator Scheme to an approved/specified person; and
  1. A deemed taxable supply of goods arising from the transfer or disposal of goods for no consideration.

What You Needs To Do?


For Supplier:

  1. Indicate the customer’s GST registration number on the tax invoice;
  2. Collect the GST-exclusive price; and
  3. Include a statement “Sale made under customer accounting. Customer to account for GST of S$X” on the tax invoice.

For Customer:

  1. Account for the GST on behalf of your supplier by reporting GST-exclusive price and GST amount in Box 1 and Box 6 of the GST Form 5 respectively.

For more information, please refer to e-Tax Guide GST: Customer Accounting for Prescribed Goods.

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