GST Security Deposit / GST Bond
What is GST Security Deposit / GST Bond?
Goods and Services Tax (GST) Security Deposit or GST Bond is a security deposit in the form of a Banker’s Guarantee or an Insurance Bond made in favour of the Comptroller of Goods and Services Tax that may be required when registering for GST. The purpose is to give IRAS the assurance that any tax liabilities will be paid and the amount of security deposit required will be notified during the application process.
When are Security Deposits required?
Security deposits may be required when registering for GST when at least one of the directors or partners of the business:
- Has outstanding income tax/penalties; or
- Has been/are a director / partner/ sole proprietor of other business(es) which has outstanding tax/penalties/returns.
A security deposit may also be imposed for any other reasons that the Comptroller deems fit.
Why Insurance Bond?
Banker’s guarantee will often impose full cash collateral to secure the guarantee on top of bank fees. Insurance bond, on the other hand, offers a smarter alternative. It allows greater financial flexibility, freeing up capital requirement for business expenses and to take advantage of commercial opportunities.
Documents required:
The following are required for evaluation:
- Letter/Email from IRAS requesting for a security deposit
- ACRA business profile
- Latest Financial Statements
- Latest income tax notice of assessment of all directors/partners/sole-proprietor
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We have built good relationship with reputable and reliable insurers to provide you with the best quotation for you and your business needs.
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Other than offering insurance products, we also provide services in re-financing and financing your newly purchased personal and commercial vehicle.
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