GST for Gold trading could be different

Under normal circumstances, GST is to be accounted for at the earliest of the following events:-

• date when goods are delivered or made available to your customer;
• date when payment is received; or
• date of issuance of invoice.

But when it comes to trading of gold where the prices are dependent on fluctuations in the market for a period of 90 days.

The law allows that the invoice to be issued on the 90th day with the price determined by (assuming the seller has not received any payment),

• buyer/seller; or
• otherwise based on the open market value prevailing on that day.

This method of accounting is only peculier to sales of gold jewellery.

GST - Residential Building Project

There is no doubt that you have to charge GST for construction services done for both residential and commercial properties.

Zero-rated if it is done on properties outside Singapore.

Situation

You are the GST-registered sub-contractor appointed to do the tiling and flooring works for a project eg. total value is $20,000 (excluding GST).

Your GST-registered main contractor will supply you the tiles eg. valued at $8,000 (excluding GST).

How could you do the billing?

Solutions

Option 1 - Invoice the main contractor on the net value ie. ($20,000 less $12,000) $8,000 + $560 GST.

Option 2 - Invoice main contractor for the total value of contract ie $20,000 + $1,400 GST. Main contractor would then invoice you for the tiles supplied ie. $12,000 + $840 GST.

P/S - Adapted from article in ST Feb 6, 2008.