How To Answer This Question ?

My tax partner has posed this question to me and my manager. The question was under FRS 40, Investment Property, is the fair value gain or loss taxable like in FRS 39, where investments in shares are taxable if it is held as a "fair value through Profit & Loss Statement"

My answer to him was it is not taxable as Singapore does not practise capital gain tax, unless the firm is in the business of property development or property trading. Further to that, the rental income collected from the property is taxed as a form of income, therefore the gain in value is considered as capital appreciation.

At first, my tax partner felt that it should be treated like FRS 39 investment catergory. I had to ask my ex colleague, CT who is now working at one of the Big Four for assistance to answer the question. His answer was the same as mine. I am relieved as his boss is the writer of my "teacher" - The Singapore Tax Workbook.

However, my boss is still not convinced. He is asking me to get a writeup from any of the Big Four Accounting Firms or IRAS website to confirm what my friend said. I wonder how to get them, when IRAS has not issued a tax guide on this.

If you are a tax professional, reading my blog, who has any of the write ups mentioned above, please contact to me as soon as possible. I really need your help on this.