Do You Need to Pay GST When You Buy Stuff on Overseas Holidays?
When Singaporeans go on overseas holidays, shopping is a mandatory activity. People are willing to travel hours to get to factory outlets in Europe and the US, and Singaporeans are experts at bargaining at markets in Thailand.
Best of all, you can find something that costs less than it does in Singapore almost anywhere in the world, whether they be Louis Vuitton bags in Paris, Innisfree face masks in Seoul or fast fashion in Bangkok.
But guess what, you might actually need to pay GST on your overseas shopping. And if you think nobody ever checks, think again—a woman recently got arrested at Changi Airport for failing to declare branded items she had bought in Europe.
This announcement surely strikes fear into the hearts of Singaporeans who regularly buy designer products overseas, especially as many don’t know when they should be declaring their purchases.
When do you have to pay GST?
Technically, Singaporeans are supposed to pay 7% GST on goods purchased overseas and taken into Singapore.
However, if you travelled overseas as a tourist (rather than on a work/business assignment), you do not have to pay GST on a certain amount of goods that were bought for your personal use.
- If you spent 48 hours or more outside of Singapore, you do not have to pay GST on 600 SGD worth of goods.
- If you spent less than 48 hours outside of Singapore, you do not have to pay GST on 150 SGD worth of goods.
Technically, anything above these amounts needs to be declared at customs upon arrival at Changi Airport, and you will then be charged 7% GST on them.
Also note that the GST relief does not extend to alcohol, tobacco products, petroleum or anything purchased for business purposes. So you will get taxed on that third* bottle of wine or that one box of cigarettes you bought overseas… and we all know how high vice taxes are here.
(*Update 2/2: Thanks to reader Adam, who pointed out that there are actually very limited duty-free concessions for liquor products.)
Can they really check?
Obviously, the vast majority of Singaporeans who shop overseas and spend above the GST relief amounts get away scot-free.
That’s because not every bag has the misfortune of getting checked.
However, if you do get checked, be aware that they’ll be checking for items that look brand new.
Obviously, it is a lot easier for them to identify an item as newly-purchased if you leave the tags or packaging on. The lady who got caught for trying to sneak home designer bags was an easy target as the bags most definitely had their original tags, dust bags and authenticity certificates on them.
And yes, even gifts can be identified for GST taxation, so be careful when receiving expensive presents from your overseas sugar daddy/mummy or whatever. And those who are holding weddings overseas, beware when trying to take your gifts home.
Don’t think that you can escape taxation by arguing that you threw away the receipts. If receipts are not available, they’ll simply estimate the amount and charge you based on that
It’s also worth noting that they’re on the lookout for people who buy goods to resell in Singapore. So multiple items of the same type, as well as items like designer bags and electronics, are prime targets.
Beware when shopping in Changi Airport’s duty free zone before departure
Thinking of buying something at Changi Airport’s duty free stores? Better wait till your return flight arrives back in Singapore to do so.
That’s because if you buy something in Changi Airport’s duty free zone before catching a flight overseas, you can technically still be taxed for it upon your return.
What if you get caught?
If you get caught for not declaring goods that should have been declared, you can usually get away with paying the necessary GST as well as a fine of up to $5,000. In serious cases (such as repeat offences), you might also get sent to court.
And that’s just if you get caught for not declaring items bought for your own personal use. If you are caught importing stuff to re-sell without paying the necessary taxes, the consequences are much graver.
Has someone you know ever been caught at customs for not paying GST? Share your stories in the comments.