Author: Lucy Beard

Sheltons Group Legal – an Australian law firm based in London

Understand Australia’s new Right to Disconnect Law

Australian employees will now have the right to refuse, monitor, read or respond to contact (or attempted contact) outside working hours, unless it would be unreasonable for them to do so.  

These changes came into effect from 26 August 2024 for non-small business employers and will come into effect for small business employers from 26 August 2025.  

  • What does the right to disconnect involve?

It is important to note that these changes do not result in a blanket ban on contacting employees after work hours. Nor do these changes actually prohibit employers from contacting employees, rather they simply allow an employee to ignore such contact without suffering any negative repercussions to their employment.  

Employees now also have the ability to seek an order from the Fair Work Commission (FWC) which prevents an employer from continually contacting the employee outside work hours. Employers then risk being fined for contravening such orders.  

However, contact made to employees after ordinary hours of work cannot be ignored if ignoring such contact would be considered ‘unreasonable’. There is no strict definition of what would be considered ‘unreasonable’, but the following (non-exhaustive) list of matters will be considered:  

  • the reason for the contact or attempted contact  
  • how the contact is made and the level of disruption the contact caused the employee
  • the extent to which the employee is compensated to remain available to be contacted or to perform work outside ordinary work hours
  • the nature and level (or seniority) of the employee’s role, and 
  • the employee’s personal circumstances (family or caring responsibilities).  

Accordingly, whether contact outside ordinary work hours would be considered unreasonable will vary between different roles and industries.  

For example, where it may be considered unreasonable to contact a low-level employee on minimum wage, that same type of contact may be considered reasonable if made to a highly compensated employee in senior management. 

  • What do these changes mean for your business? 

Employers will need to review and potentially reconsider their operations and how they engage with their workforce.  

In particular, businesses with international workforces will need to reconsider their expectations of Australian employees in terms of their availability outside of Australian business hours.  

In order to mitigate the risk of employees seeking orders from the FWC, and subsequent fines should such orders be contravened, businesses may consider the following options:   

  • Reviewing employment contracts to clarify position descriptions and ensure that it is clear what out of hours contact is expected with the role. 
  • Ensuring that employees are compensated for out of hours contact which could be provided as part of their salary, overtime pay and/or time off in lieu.  
  • Implementing an out of hours contact policy setting out clear expectations as to when and why employees may be contacted out of hours (e.g., the policy could list specific emergency situations in which employees will be required to respond to contact).  
  • Workplace policies should also set out a complaints process or a dispute resolution process to encourage employees to resolve matters internally rather than seeking orders from the FWC.  
  • Implement training programs to ensure all managers are aware of their obligations.  

It is important that all employees (including managers) within your business are aware of, and understand, the rights and obligations under Australia’s new right to disconnect laws. 

If you require assistance or advice on these new laws, then please do not hesitate to contact us.  

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Courtney Gleeson
Lawyer
Sheltons Group Legal (London and Sydney)
C.Gleeson@SheltonsGroup.com

Sheltons Group Legal – legal services from Europe

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Sheltons Group Legal – an Australian law firm based in London

Understanding the Proposed Changes to Australia’s Foreign Investment Framework

Earlier this year, Australia’s Treasurer, Dr Jim Chalmers, announced significant changes to Australia’s foreign investment framework with an aim to enhance national security and economic resilience.

Foreign businesses and investors planning to invest or establish commercial operations within Australia may require prior approval from the Australian Treasury. The Australian Treasury is advised by the Foreign Investment Review Board (FIRB), which examines and assesses investment proposals. As a foreign business or investor, depending on the nature of the business or investment, you may be required to submit your business or investment proposal to FIRB for assessment.

There are currently no proposed legislative changes, rather the changes will be implemented via streamlining Treasury processes, amending internal policies, and increasing resources.

We outline below the key points from Treasurer Jim Chalmers’ announcement. The Australian Government’s proposal intends to implement the following changes:

  • Increasing the Treasury’s capacity to efficiently assess complicated or high-risk proposals by dedicating more resources to the teams which assess such proposals;
  • Increasing scrutiny on sectors where there are supply chain resilience concerns, where there is a need to protect sensitive data, or where there may be a concentration of ownership concerns;
  • Streamlining processes to provide faster approvals for known investors who are investing in non-sensitive sectors and who have a good compliance record;
  • Ensuring foreign investors pay the correct amount of tax by continuing to update guidance about tax arrangements that will attract greater scrutiny (such as those which are overly complex); and,
  • Enhancing compliance and monitoring to enforce conditions on foreign investments by increasing resources to compliance teams.

The good news from this announcement is that Treasury is looking to increase efficiency and reduce assessment times for investors engaging in low-risk investments.

What does this mean for your business?

The proposed changes may result in increased regulatory compliance for foreign businesses that plan to invest or operate in Australia. If your business is planning to invest or establish commercial operations within Australia, it is important that you understand Australia’s regulatory framework prior to investing.

For further details, you can refer to the full announcements and policy documents on the Treasury’s official website here: https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-strengthen-australias-foreign-investment

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If you’re looking to invest or establish operations in Australia, then feel free to let our London-based Australian qualified lawyers know and we can discuss how we can assist.

Courtney Gleeson
Lawyer
Sheltons Group Legal (London and Sydney)
C.Gleeson@SheltonsGroup.com

Sheltons Group Legal – legal services from Europe

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Sheltons Group Legal – an Australian law firm based in London

The Australian Fair Work Commission has determined that Australia-wide increases are to apply to the national minimum wage as well as to Modern Award minimum wages. The increases took effect from 1 July 2024.

Each year, the Fair Work Commission (‘FWC’) makes an order that covers subjects including the national minimum wage after considering factors relevant to the economy, employers, and employees.

Accordingly, the FWC’s Annual Wage Review 2023-24 announced that the national minimum wage and Modern Award minimum wages would be increased by 3.75%.

As a result, the national minimum wage has increased from AUD 882.80 to AUD 915.90 per week for full time employees (i.e. employees who work an average of 38 hours each week) – meaning the hourly minimum wage is now AUD 24.10. The Modern Award minimum wage increase means that pay rates above AUD 915.90 per week have increased by 3.75% per week.

Modern Awards are industry or occupation specific and apply to those performing work covered by the Award. As such, it is important to be aware that different minimum wage rates apply across different Modern Awards.

Approximately 2.6 million employees across Australia are expected to receive the minimum wage increases. It is therefore essential that all employers take note of the increases to ensure each employee is being paid at or above the new minimum rates. Annualised salaries must be sufficient to absorb all statutory entitlements.

If you would like further information about the Australian wage increases, or assistance in determining which Modern Award applies to your employees – please contact us.

Courtney Gleeson
Lawyer
Sheltons Group Legal (London and Sydney)
C.Gleeson@SheltonsGroup.com

Sheltons Group Legal – legal services from Europe

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Singapore incorporated companies are required to file financial statements with the Accounting and Corporate Regulatory Authority (ACRA). There are some exemptions. Additionally, some companies will also be required to file eXtensible Business Reporting Language (XBRL) format financial statements with ACRA.  

There are four types of XBRL templates which can be used: 

  • Full XBRL 
  • Simplified XBRL 
  • XBRL Financial Statements Highlights (Banks) 
  • XBRL Financial Statements Highlights (Insurance) 

The majority of non-publicly accountable companies will file XBRL financial statements using the full or the simplified template.  

The filing of full XBRL financial statements is mandatory in the following circumstances: 

  • Singapore incorporated exempt private companies (EPCS) that are insolvent and do not meet the “small company” criteria 
  • Singapore incorporated non-exempt private companies (EPCs)  

An exempt private company (EPC) will be characterised as follows: 

  • Usually ends with “Pte Ltd” 
  • Has a maximum of 20 shareholders 
  • Does not have any corporate shareholders 
  • Has a share capital 

A company fulfils the definition of a “small company” if the revenue and total assets for the financial year end do not exceed SGD 500,000 respectively. 

For more details on eXtensible Business Reporting Language financial statements filling requirements, please contact us.  

Contact Us

At Sheltons Accountants Singapore we have extensive experience in providing Singaporean and international tax advice. This includes advice on tax treaty issues and cross-border tax efficient structuring.

If you need advice or assistance with your Singaporean tax obligations, or if you would like us to prepare your Singaporean tax returns, we’re here to help.

Simply send us an email at SG@SheltonsGroup.com.

Sheltons Singapore

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From 1 January 2024, the Goods and Services Tax (“GST”) in Singapore was increased from 8% to 9%. 

The GST rate chargeable on the supply will be the prevailing rate at the time of supply. The time of supply for most transactions is triggered by the earlier of the following two events: 

  • When payment is received 
  • When an invoice is issued 

GST-registered businesses need to know when their supplies are delivered or performed, in addition to the invoice date and payment date, to determine whether and how the transitional rules would apply to a supply spanning across the date of rate change. 

A transaction spans a GST rate change when one or more of the following events straddles the date of the rate change: 

  • The issuance of an invoice
  • The receipt of payment
  • The delivery of goods or performance of services. 

For more information on the transitional rules with respect to the GST rate changes, please contact us.  

Related blogs:

Goods and Services Tax (GST)

Singapore tax treatment of gains from sale of foreign assets

Contact Us

At Sheltons Accountants Singapore we have extensive experience in providing Singaporean and international tax advice. This includes advice on tax treaty issues and cross-border tax efficient structuring.

If you need advice or assistance with your Singaporean tax obligations, or if you would like us to prepare your Singaporean tax returns, we’re here to help.

Simply send us an email at SG@SheltonsGroup.com.

Sheltons Singapore

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With effect from 1 January 2024 Singapore will, under certain circumstances, treat gains from the sale or disposal of foreign assets as income chargeable to tax under Section 10L of the Income Tax Act.

Prior to 1 January 2024, Singapore did not tax gains from the sale or disposal of assets that are capital in nature, whether they were foreign-sourced or Singapore-sourced.

However, foreign-sourced disposal gains are now chargeable to tax under the following specific circumstances:

  • the gains are received in Singapore from outside Singapore by a covered entity, and
  • the gains are derived by an entity without adequate economic substance in Singapore.

Entities that have reasonable economic substance and whose operations are managed and performed in Singapore are excluded. In this regard a distinction is made between PEHE and non-PEHE entities.

Pure equity-holding entities (PEHEs) are subject to less strict economic substance requirements. These are entities whose primary function is to hold shares in other entities, and that have no other income than dividends from or gains on the disposal of the shares.

Covered entities relate to “relevant groups” whereby:

  • the entities of the group are not all incorporated, registered or established in Singapore; or
  • any entity of the group has a place of business outside Singapore.

Note that the above represents a limited summary of the new Section 10L rules. Section 10L is complex and official guidance is still awaited. Professional advice is strongly recommended.

Contact Us

At Sheltons Accountants Singapore we have extensive experience in providing Singaporean and international tax advice. This includes advice on tax treaty issues and cross-border tax efficient structuring.

If you need advice or assistance with your Singaporean tax obligations, or if you would like us to prepare your Singaporean tax returns, we’re here to help.

Simply send us an email at SG@SheltonsGroup.com.

Sheltons Singapore

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Sheltons Group Legal – an Australian law firm based in London

Investing in Australia?

Know your obligations under the new Register of Foreign Ownership of Australian Assets

From 1 July 2023, foreign investors have been required to notify the newly established Register of Foreign Ownership of Australian Assets (the Register) if they acquire interests in particular Australian based assets. Notice must also be given if an Australian entity, that held an interest prior to 1 July 2023, becomes foreign owned after such date.

The information stored on the Register is not publicly available, and its purpose is to give the Australian government greater visibility of foreign ownership of Australian assets.

The following are some of the types of interests which will require a foreign investor to give notice to the Register:

  • an interest in Australian land which is a freehold interest, a long-term lease (where the term including any options exceeds 5 years), or an interest in an exploration tenement
  • an interest in a share or unit of an Australian land corporation or trust or an interest in a share of the trustee of an Australian land trust
  • a registerable water interest, and
  • an equitable interest in a long-term lease or licence of agricultural land.

Generally, a foreign investor must give notice to the Register within 30 days after they acquire an interest, or if there is a change of at least 5% in the interest of an entity.

Civil penalties will apply if an entity fails to give notice to the Register within the relevant timeframes. Additionally, foreign investors may have ongoing notification obligations depending on the nature of the asset.

What does this mean for your business?

The implementation of the Register increases regulatory compliance for foreign businesses that plan to invest and operate in Australia.

It will mean that your internal procedures will need to be updated, especially if you are a business that undertakes a broad range of commercial activities within Australia.

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If you’re looking to invest or establish operations in Australia, or if you’re an Australian entity looking to receive foreign investment, then feel free to let our London-based Australian qualified lawyers know and we can discuss how we can assist.

Courtney Gleeson
Lawyer
Sheltons Group Legal (London and Sydney)
C.Gleeson@SheltonsGroup.com

Sheltons Group Legal – legal services from Europe

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In Singapore, any income received from services provided or employment exercised within the country is taxable. This includes compensation received in the form of cash or non-cash benefits. Since the income is sourced in Singapore, it is subject to Singapore’s tax. Income tax is calculated on a preceding year basis.

The amount of tax and the applicable tax rates depends on the taxpayer’s tax residency status. Singapore has several tests in regard to whether a foreigner is a resident in Singapore. The key tests of relevance relating to a foreigner coming to Singapore are set out below.

You are a tax resident for a particular Year of Assessment if you are a:

  • Foreigner who has stayed/worked in Singapore:

– for at least 183 days in the previous calendar year, or
– continuously for 3 consecutive years, or

  • Foreigner who has worked in Singapore for a continuous period straddling 2 calendar years and the total period of stay is at least 183 days. This applies to foreign employees who entered Singapore.

To elaborate on the second point above, you will be regarded as a tax resident under the 2-year rule if you:

  • work in Singapore for a period straddling 2 calendar years; and
  • your employment period plus your physical presence immediately before/after your employment cover a continuous period of at least 183 days.

Note that the number of days of employment in Singapore includes weekends and public holidays. Any absences from Singapore that are temporary (e.g. overseas holiday leave) or incidental to your employment (e.g. business trips) are still counted in the total days of employment for the purpose of determining your tax residency status.

The income of tax residents after deducting allowable expenses, donations and personal reliefs is subject to income tax at progressive rates ranging from 0% to 22%.

Contact Us

At Sheltons Accountants Singapore we have extensive experience in providing Singaporean and international tax advice. This includes advice on tax treaty issues and cross-border tax efficient structuring.

If you need advice or assistance with your Singaporean tax obligations, or if you would like us to prepare your Singaporean tax returns, we’re here to help.

Simply send us an email at SG@SheltonsGroup.com.

Sheltons Singapore

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GST, also known as VAT, was introduced in Singapore on 1 April 1994 at the rate of 3%. This has progressively increased and currently it is at 8%. With effect from 1 January 2024, this will be increased to 9%. Only GST registered businesses can charge GST.

GST can be broadly classified into two categories:

– Taxable supply

  • Standard-rated supply
  • Zero-rated supply

– Non-taxable supply

  • Exempt supply
  • Out-of-scope supply

Standard-rated supply is when GST is charged at the prevailing rate by GST-registered businesses on all sales of goods and services made in Singapore.

Zero-rated supply relates to export of goods and the provision of international services where GST is charged at 0%.

Exempt supply includes the provision of financial services, sale and lease of residential properties and local supply of investment precious metals. No GST is charged on exempt supplies.

Out-of-scope supplies include supplies where the place of the supply is outside of Singapore. No GST is charged. Examples of out-of-scope supplies include:

  • Sales of goods delivered from a place outside of Singapore to another place outside of Singapore
  • Sales of overseas goods within a Free Trade Zone (FTZ)
  • Sales of overseas goods within Zero GST/Licensed warehouse
  • Private transactions

Compulsory GST registration is required under the following conditions:

  • Under the retrospective view, the taxable turnover is more than SGD1 million at the end of the calendar year, or
  • Under the prospective view, the taxable turnover is expected to be more than SGD1 million in the next twelve months

Taxable turnover refers to the total value of all taxable supplies made in Singapore, which includes standard-rated supplies and zero-rated supplies. Taxable turnover does not include exempt supplies, out-of-scope supplies and sale of capital assets.

Contact Us

At Sheltons Accountants Singapore we have extensive experience in providing Singaporean and international tax advice. This includes advice not only on GST but also on tax treaty issues and cross-border tax efficient structuring.

If you need advice or assistance with your Singaporean tax obligations, we’re here to help.

Simply send us an email at SG@SheltonsGroup.com.

Sheltons Singapore

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Singapore incorporated companies will be assessed on the requirement for audit based on the “small company concept”.

A company qualifies as a “small company” if the following are met:

  • It is a private company in the financial year in question

and

  • It meets at least two out of three of the following quantitative criteria
  1. Total annual revenue is less than or equals to SGD10 million
  2. Total assets are less than or equal to SGD10 million
  3. Number of employees are less than or equal to 50

For a company which is part of a group, in order to qualify for an audit exemption:

  • The company must qualify as a “small company” and
  • The entire group must be a “small group”

A group is considered a small group if it meets at least 2 of 3 of the quantitative criteria on a consolidated basis for the immediate past two consecutive financial years.

The above “small company” audit exemption only applies to Singapore incorporated companies. However, for the purposes of determining whether the Group to which a company belongs is a “small group”, all entities within that group are taken into account, including foreign entities, in determining whether the consolidated total revenue, total assets and number of employees of the group meet the thresholds.

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At Sheltons Accountants Singapore we have extensive experience in setting up and administering operations for overseas-based businesses. We provide a broad range of services, from setting up the entity and opening a bank account, to providing the legally required local director and a full range of tax, accounting, company secretarial and administrative services.

We are also experienced in providing local and international tax advice, advice on tax treaty issues and cross-border tax efficient structures.

If you need advice or assistance with UK, Singaporean or Australian matters, we’re here to help. Simply send us an email at SG@SheltonsGroup.com. 

Sheltons Singapore

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