Year-of-Assessment-and-Basis-PeriodIn Singapore, income tax is annual in its structure and organisation. Since income tax is charged on a preceding year basis, it is important to distinguish between a “year of assessment” and the “basis period” for a year of assessment.

Each year of assessment (YA) or statutory tax year starts on the first date of the year ie 1 January and ends on 31 December. The year of assessment is the year of which the income tax is charged after calculation. For example, the 2016 year of assessment is the period from 1 January 2016 to 31 December 2016.

The “basis period” for a year of assessment refers to the standard period of income that is relevant to the year of the assessment. For example, the basis period for the year 2015 year of assessment is the period from 1 January 2014 to 31 December 2014, ie the year preceding the year of assessment. Note that a different basis period is applied to businesses whose accounts are not other dates instead of 31 December.

Preceding Year, Year of Assessment and Basis Period

Income tax is paid for each year of assessment and the income that is charged is referred to as the statutory income. Statutory income means the income for the year preceding the year of assessment, ie income of the previous year.


A taxpayer’s total income from employment, dividends and interest for the period 1 January 2015 to 31 December 2015 is $43,000. The year of assessment in which this will suffer tax is 2016. The income of $43,000 is referred to as the statutory income for the year of assessment 2016.

Examples of Financial Year Ends

Financial Year End Basis Period Year of Assessment (YA)
31 March of each year 1 April 2015 – 31 March 2016 2017
30 June of each year 1 July 2015 – 30 June 2016 2017
31 December of each year 1 January 2016 – 31 December 2016 2017

From a company’s perspective, income from a dividend does not accrue until it has been declared and becomes payable. A dividend that has been declared and paid in one calendar year is included for assessment in the following year of assessment. This is so even if the amount of the proposed dividend has, in accordance with good accounting services practice, been included as a credit item in a company’s profit and loss account for the calendar year before the year in which the dividend is declared.

The terms “preceding year” and “year of assessment” are necessarily wedded. A straightforward “preceding year basis” of assessment is adopted for all sources of income. Another term that commonly appears in taxation is “basis period”. This means the period of income relative to a year of assessment. For example, the “basis period” for the year of assessment 2015 is the year 1 January 2014 to 31 December 2014 and it is the income of this period that is charged in 2015.

Please see Singapore Tax Basis Period for more examples of different basis periods.