ECI

Estimated Chargeable Income (ECI) — the income of a company after deducting tax-allowable expenses. ECI is a necessary piece of data a company submits to IRAS within 3 months from the end of their financial year. It is then compared to the chargeable income stated in Form C-S/ C and either the excess tax is refunded, or you must pay the remaining tax within 1 month.

How to calculate ECI: Step 1 | Net profit before tax example

LineS$
SalesS$ 100,000
Less: Cost of goods soldS$(40,000)
Rental IncomeS$ 2,000
Gross ProfitS$ 60,000
AdvertisementS$(10,000)
DepreciationS$(500)
Directors’ feesS$(12,000)
Printing and StationeryS$(100)
Property Tax (rental property)S$(400)
SalariesS$(26,000)
Secretarial FeesS$(300)
Water & ElectricityS$(1,000)
Net Profit before TaxS$ 11,700

How to calculate ECI: Step 2 | ECI example

Let's assume your company bought S$500 worth of desks for the office and a S$1,500 laptop.

LineS$
Net Profit before TaxS$ 11,700
Rental IncomeS$(2,000)
DepreciationS$ 500
Property Tax (rental property)S$ 400
Adjusted profit before Capital AllowancesS$ 10,600
100% Write-Off for Low-Value Asset - desksS$(500)
100% Write-Off in One Year for LaptopS$(1,500)
Adjusted profit after Capital AllowancesS$ 8,600
Rental income (net of Property Tax for rental income)S$ 1,600
Estimated Chargeable Income (before exempt amount)S$ 10,200

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