Many local businesses have gone onto the online world to sell its products. With the COVID-19 restriction, this push to online sales is no longer an option but a necessity for survival. When you start to push your sales of physical goods (eg mobile accessories, face mask) over online shopping platforms including Shopee, Lazada, Qoo10 and Carousell to your customers in Singapore, you have to include these online sales to assess whether you need to register for GST.
Your turnover would have to include your existing physical store sales as well as your online sales. The simple test (retropective test) to perform is to set an annual reminder on the last day of each calendar year on the 31 December to eyeball your turnover whether it exceeds S$1m for that year*. Next to perform a another test (prospective test) on the same turnover for the next 12 months if it exceeds S$1m. If the turnover exceeds S$1m for any of these two tests, you have to apply for GST registration within 30 days, failing which you are liable for prosecution, fine of $10,000, a penalty equal to 10% of the GST due and/or payment of GST (even if you did not collected it) backdated to your registration.
A local businessman running two sole proprietorships selling mobile phones and accessories on online platforms have been charged in October 2020 for failing to consider its online sales for the registration of GST.
*From 2019 onwards, the assessable period for GST S$1m threshold has been simplified to a fixed 12-month calendar year of 1 January to 31 December. Prior to 2019, the assessable period is dynamic and you have to make an assessment at the end of each quarter covering the current quarter and the past 3 quarters.