Topic $6-$ Taxation of Non$-$Residents

Question $1$

F$1$ Solutions Company $("$F$1$ Solutions"$),$ a non$-$resident company with no permanent establishment in

Singapore, developed an analytical software to analyse track patterns and race forecasts with high

accuracy for formula one races. In $2021,$ F$1$ Solutions signed a contract outside Singapore to sell a

computer for $$400,000$ to SG Racing Pte Ltd$.("$SG Racing"$),$ a Singapore$-$incorporated and resident

company. F$1$ Solutions also agreed to provide the license and use of its patented software for $$100,000.$

F$1$ Solutions' software engineer, Alonso, was flown to Singapore to provide technical services for a

period from $1$ Aug $-31$ Oct $2023.$ He will be paid a monthly salary of $$12,000$ by F$1$ Solutions. The

engineer is $30$ years old and is single.

$($a$)$ Explain whether F$1$ Solutions is liable to Singapore tax on the sums of $$400,000$ and $$100,000.$

$($b$)$ Calculate the software engineer's tax liability for YA $2024.$

$($c$)$ Advise F$1$ Solutions on the tax implications of whether they should employ the engineer and

charge SG Racing $$36,000$ for the technical services $("$show$-$how"$),$ or SG Racing should employ

the engineer and directly bear his $$36,000$ salary.