The short answer
- Yes. Singapore law lets accounting records be kept outside Singapore, as long as statements and returns are sent to and kept in Singapore and open to directors.
- India's POEM guidelines say accounting and other support functions in India do not, on their own, make a company Indian resident.
- But for companies without an active business abroad, where accounting records are kept is a secondary POEM factor. Combined with other India-side facts, it adds up.
- Doing the work in India and owning it in Singapore is usually the right split: Indian team for processing, Singapore for review, approval and records.
What the law says
Section 199 of the Companies Act requires accounting records to be kept at the registered office or another place the directors think fit. If they are kept outside Singapore, statements and returns on those records must be sent to and kept at a place in Singapore, open to the directors at all times. Records must be kept for at least five years. Failure is an offence for the company and every officer in default.
What it means for POEM and substance
The CBDT guidelines say preparatory or auxiliary support functions in India, such as accounting, do not by themselves establish POEM in India. For companies that fail the active business test, though, the place where accounting records are kept is listed as a secondary factor. On its own it is minor. Alongside directors in India, management in India and approvals from India, it is one more brick.
Case by case
| Situation | Accounting from India? | Why |
|---|---|---|
| Operating company with a senior team in Singapore (CEO or CFO based here) | Recommended for processing | Decisions are clearly in Singapore. India adds cost and speed. Keep review, approval and records in Singapore |
| Subsidiary of an Indian group using the group's shared service centre | Yes, with controls | Common and defensible as a support function. Use a service agreement with arm's length pricing, and keep a Singapore approver |
| Investment holding company, all directors in India, claiming treaty benefits | Not recommended | Accounting in India sits on top of other India-side facts. Use a Singapore accounting agent and keep records in Singapore |
| Company applying for a certificate of residence for the first time | Use a Singapore agent, at least for the first years | Builds the Singapore evidence file IRAS and India will look for |
| Company with a tax incentive (13O, 13U or others) or treaty-sensitive gains | Singapore agent recommended | Incentives and treaty claims depend on visible Singapore substance |
| Small trading or service company owned by Indian founders who live in Singapore | Either works | The founders are the substance. Choose on cost and quality |
When to appoint a Singapore accounting agent
- The company will claim treaty benefits or a tax incentive
- Most directors and managers live in India
- The company is a holding company with passive income
- The Indian team does not know Singapore rules (GST, XBRL, Form C-S, CPF)
- You need a local approver and a local point of contact for IRAS and ACRA
A split that works
- India: transaction processing, reconciliations, draft reports.
- Singapore: review, approval of payments and journals, tax and ACRA filings.
- Records: the ledger lives in the cloud, with monthly statements and returns kept in Singapore as section 199 requires.
What the Singapore reviewer does each month
- Reviews bank reconciliations and unexplained items
- Approves payments above the delegated limit, and every new supplier bank detail
- Reviews journals posted outside the routine, such as accruals and write-offs
- Checks GST treatment on new types of transactions
- Signs off the monthly management accounts
- Files the statements and returns that section 199 requires to be kept in Singapore
This takes a few hours a month for a typical small company. It is the difference between "accounting is done in India" and "the company is run from India", which is the distinction that matters for substance.
Making the shared service arrangement defensible
Where the Indian parent's team does the work, put a short service agreement in place: scope, service levels, data access and confidentiality, and a fee at cost plus a supported mark-up. The fee is a transfer pricing item on both sides, so describe it the same way in both countries. See transfer pricing between India and Singapore.
Questions people ask
Can a Singapore company's accounting be done from India?
Yes. Section 199 of the Companies Act allows records to be kept outside Singapore, provided statements and returns are sent to and kept in Singapore and are open to directors.
Does accounting in India create POEM risk?
Not on its own: the CBDT guidelines treat support functions like accounting as insufficient by themselves. For companies without an active business abroad, where accounting records are kept is a secondary factor, so it adds to other India-side facts.
When should we appoint a Singapore accounting agent?
When the company claims treaty benefits or tax incentives, is a holding company with passive income, or has most directors and managers in India.
Talk it through with an adviser
Tell us your structure and deadlines. We reply with what applies to you and a fixed-fee proposal.
Sources
- Companies Act 1967, section 199 (text) (secondary source)
- CBDT Circular 6 of 2017, POEM guiding principles (reproduced) (secondary source)
- IRAS: Applying for a certificate of residence
General information only, last reviewed 11 November 2026. It is not advice for your situation. Laws and practice change, and the official sources linked above prevail. Speak to a qualified adviser before you act. Northwise does not file with Indian authorities; India-side work is done by independent licensed firms.
