Interest is earned from deposits of money with banks, finance companies or other financial instruments.
On this page:
Non-taxable interest
Interest received from the following sources is not taxable:
- Deposits with approved banks in Singapore;
- Deposits with finance companies licensed in Singapore;
- Debt securities (e.g. bonds) – but not if these are (i) owned by a partnership or (ii) inventory of a trading business; and
- Foreign sources (generally, foreign-sourced interest is interest paid by a foreign company or business) – but not if the foreign-sourced interest is earned by a partnership.
Note: Interest paid by a Singapore branch of a foreign company or business is Singapore-sourced interest.
You may check if a bank is an approved bank or a licensed finance company on the MAS website.
Please refer to:
- 'Commercial Banks' and 'Merchant Banks' for the list of approved banks in Singapore.
- 'Finance Companies' for the list of licensed finance companies.
Taxable interest
Interest from the following sources is taxable:
- Deposits with non-approved banks in Singapore;
- Deposits with finance companies not licensed in Singapore;
- Pawnshops in Singapore;
- Loans to companies, persons, etc.;
- Interest from the refund of excess employee's CPF contributions; and
- Debt securities (e.g. bonds) that are (i) owned by a partnership or (ii) inventory of a trading business.
Reporting interest
You must declare the full amount of your taxable interest under 'Other Income' in your Income Tax Return.
You do not need to declare interest that is not taxable in your Income Tax Return.