Singapore is one of the friendliest countries in the world when it comes to crypto tax, mainly because they lack a capital gains tax treatment and because you won't be taxed for using crypto as payment for goods and services. However, Singapore is far from being a tax-free country, as crypto investments can be subject to income tax. For this reason, I recommend keeping a record of your crypto transactions in order to easily report them to the Monetary Authority of Singapore (MAS).
Capital is my recommended exchange for Singaporean crypto investors, both for its high level of security and for its ease of use. Capital is also offering zero commission fees if you sign up using our referral link, so if you’re looking for a secure, cost-effective way to buy and sell crypto in Singapore, I can’t recommend Capital highly enough.
Do I Have To Pay Taxes On Crypto In Singapore?
Yes and no. The Singaporean Government taxes crypto depending on the kind of activity that you are doing with the tokens: for instance, if you're trading cryptocurrencies and it's being carried out in the ordinary course of business, then the Singaporean Government will treat your trading like any other investment, meaning it would be subject to income tax. Because of this, any losses and gains you make must be recorded on an annual tax return so that you can report them to the Monetary Authority of Singapore (MAS).
Things change if the crypto you buy is intended to be a long-term investment, though: this would mean that capital gains made from them would not be subject to taxation because Singapore does not impose taxes on capital gains.
It's even weirder if you use cryptocurrencies to pay for goods and services: if you do, then the business providing the goods or services will be taxed based on the value of the goods or services being provided. This is because cryptocurrencies are not the same as fiat currencies (meaning they aren't considered legal tender), and they are treated as intangible property for the purposes of income tax treatment. Because of this, transactions using crypto as payment are considered barter trade (trade of goods and services between two parties that don't use money) by the Singaporean Government.
Is Crypto Tax-Free In Singapore?
It depends on the kind of activity that you incur when making cryptocurrency transactions, but for the most part, Singapore is not a tax-free country as far as crypto is concerned. If you trade cryptocurrencies regularly, then the Monetary Authority of Singapore (MAS) will tax your crypto gains just like most other countries would. However, if your crypto transactions were to be interpreted as capital gains by the MAS, then you wouldn't be taxed as Singapore lacks tax laws involving capital gains.
If you use crypto to pay for goods or services, then the business providing the goods or services will be taxed on your behalf, reducing the likelihood of businesses accepting your crypto tokens as a form of payment.
How Is Cryptocurrency Taxed In Singapore?
The Monetary Authority of Singapore divides digital payment tokens into three different categories:
- Utility tokens: These are app coins and/or user tokens that enable access to goods and services offered by a company in the future. They aren't seen as an investment by the Monetary Authority of Singapore (MAS).
- Payment tokens: These tokens are only used to pay for goods and services in the present, meaning that they aren't seen as investments by the Monetary Authority of Singapore (MAS) either.
- Securities tokens: These tokens are digital assets representing transferred ownership, rights, or asset value to any token coming from a blockchain. They are seen as an investment by the MAS, meaning that they can be subject to income tax.
The MAS only concerns itself with securities tokens: it doesn't regulate other digital tokens unless they fall under that definition. If an institution or business offers a digital payment token that can't be considered securities tokens, they have to disclose that they aren't approved by the MAS, as well as the risks associated with these tokens in general.
How Much Is Crypto Tax In Singapore?
As previously stated, there aren't any capital gains taxes in Singapore, which is great. Income tax, on the other hand, has a rate of 17% in Singapore, meaning that if your business or profession trades security tokens (like crypto) for profit, you'll be taxed 17% of your total income. It's hard to tell what the Monetary Authority of Singapore (MAS) considers trading and capital gains investments, however.
It's worth pointing out that using cryptocurrencies as payment for goods and services doesn't incur tax in Singapore (at least not for you). In this case, the business selling the goods and services will be taxed on your behalf, meaning that the purchase and sale of crypto are usually not subject to Goods and Services Tax.
Is Bitcoin Taxable In Singapore?
Yes, Bitcoin and other altcoins (like Ethereum, XRP, and Shiba Inu) are taxable in Singapore. This is because the MAS considers them to be securities tokens, meaning that they can be considered an investment and are therefore subject to income tax. And even though Singapore doesn't impose a capital gains tax, this doesn't mean that profits booked as crypto transactions in the country won't be taxed.
Still, Singapore is a prime location for crypto traders: because of a lack of capital gains tax law, you'll still pay considerably fewer taxes on crypto than other countries worldwide. Mining has to be approached with caution, on the other hand, as electricity costs in Singapore can be extremely high.
In Summary
Singapore is one of the friendliest countries in the world when it comes to crypto taxes, mainly because they lack a capital gains tax and because you won't be taxed for using crypto as payment for goods and services. However, Singapore is far from being a tax-free country, as crypto investments can be subject to income tax. For this reason, I recommend keeping a record of your crypto transactions in order to easily report them to the Monetary Authority of Singapore (MAS).
Capital is my recommended exchange for Singaporean crypto investors, both for its high level of security and for its ease of use. Capital is also offering zero commission fees if you sign up using our referral link, so if you’re looking for a secure, cost-effective way to buy and sell crypto in Singapore, I can’t recommend Capital highly enough.
Crypto Tax Singapore FAQs
Is Cryptocurrency Legal In Singapore?
Yes, all cryptocurrencies (including Bitcoin, Ethereum, and Dogecoin) are legal in Singapore. Holding digital assets like in crypto wallets (both cold and hot), as well as being a crypto trader in Singapore, are also both legal crypto activities. It doesn't matter if you got your Bitcoin from virtual asset services providers like Capital or if you bought them directly from your software wallet; it's perfectly legal to own them.
The Singaporean government also allows the use of crypto in general, which means that you can transfer cryptocurrencies without any issues, as well as use them in transactions involving both Internet-based and brick-and-mortar businesses (if they choose to accept digital currencies).
Is It Illegal To Mine Bitcoin In Singapore?
No. Considering that cryptocurrencies in general are perfectly legal in Singapore, then you can rest assured that mining Bitcoin in Singapore is also legal. However, mining Bitcoin in Singapore may be subject to income tax in Singapore, and you'll also want to consider the cost of building your own rig and the cost of electrical bills (which are huge in Singapore).
How do I buy Bitcoin in Singapore?
In order to buy Bitcoin in Singapore, you have many options: you can buy Bitcoin tokens from one of many Bitcoin ATMs scattered across Singapore, use a cryptocurrency broker to buy and sell crypto instantly, or you can mine the Bitcoin tokens yourself through the use of a powerful computer (known as a Bitcoin miner).
However, when it comes to convenience, your best option is to use a Singaporean cryptocurrency exchange, which allows you to exchange fiat currencies (including SGD) for Bitcoin and other altcoins. In particular, I recommend using an exchange that prioritizes safety like Capital, which has the lowest fees and the strongest platform security of all of the exchanges in Singapore.
Is crypto investment income taxable in Singapore?
It depends on the nature of these crypto investments. If you engage in crypto trading on a regular basis, then they most certainly will be income taxable and you'll need to report your transactions to the Monetary Authority of Singapore (MAS). However, if they are perceived as capital gains, then you'll be able to get off the hook in terms of tax responsibility because Singapore doesn't have a capital gains tax.
Can I avoid paying taxes on crypto in Singapore?
No, you cannot avoid paying taxes on your crypto in Singapore. Even though you can avoid some taxes (because Singapore doesn't have capital gains tax laws), you'll still be liable for income tax for certain transactions (generally if you accept cryptocurrencies as payment while acting as a business).
However, Singapore does have some of the most relaxed crypto tax laws in the world, making it a great location for crypto traders and miners alike.
Is crypto trading income taxable in Singapore?
Yes, crypto trading is subject to income tax in Singapore. If you're a regular crypto trader living in Singapore, you should make a record of your transactions so you can report them to the Monetary Authority of Singapore (MAS) each year.
