Insurers' asset sale gains not always taxable, court rules
[SINGAPORE] Singapore's Court of Appeal has issued a landmark ruling on the income tax treatment of investment gains accruing to insurance companies.
In the first such case heard here, the ruling of the apex court makes clear that gains from the sale of assets held by regulated insurance companies in insurance funds mandated by the Insurance Act are not automatically considered taxable income.
Instead, the reason for which such assets are held needs to be first determined. If the assets are held for the purposes of trade, the gains would likely be considered taxable income; if they are held for the long-term strategic interests of the business, then the assets would be considered capital - and the gains not taxable.
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