Xero receives IRAS certification

Mar 17

Xero receives IRAS certification

This article was originally published on LinkedIn Pulse. 

Inland Revenue Authority of Singapore (IRAS) maintains an Accounting Software Register, which as of today has Xero as the 52nd and latest addition. What does being on the register mean for Xero and its users?

Let me answer this by looking at these two questions:

Is being on the IRAS’ Accounting Software Register mandatory for a software to comply with Singapore regulations?

 

In a word, No. The register is a listing of software providers who have provided a self-declaration to IRAS that they meet the principles & technical requirements as laid down by the tax authority. IRAS does not check or guarantee the accuracy of these declarations, therefore being on the register does not necessarily guarantee a software is compliant with the tax authorities requirements.

Conversely, not being on the register does not mean a software is non-compliant either – this was the boat Xero was on until 2015. Xero was not on the register but they are still compliant with IRAS’ requirements. Which leads me to the second question.

Tweet: What does being on the IRAS Accounting Software Register mean for Xero & its users? @Nam_Futurebooks shares here http://bit.ly/XeroIRAS Tweet This: ‘What does being on the IRAS Accounting Software Register mean for Xero & its users? Namita Sethi, Futurebooks CEO, shares her thoughts here http://bit.ly/XeroIRAS’

What does IRAS require from accounting software providers to be compliant?

IRAS’ general principles for accounting software providers are adopted from the guidance notes of Organisation for Economic Co-operation and Development (OECD). They are:

Ability to generate financial statements for tax reporting

Comprehensive documentation on how the software operates

Adequate internal controls to ensure reliability

Adequate audit trail

Data archival & restoration mechanisms

Ability to automatically generate an IRAS audit file in case of a tax audit

 

IRAS does not require accounting software providers to store data locally in Singapore, therefore, cloud-based multi-location storage is acceptable.

Screenshot of IRAS Accounting Software Register on Xero

Xero is the latest addition to IRAS’s list of certified accounting software

Xero’s listing on the IRAS Accounting Software Register, though not mandatory, is a positive step for the company and its users. This will give small businesses and growth startups in Singapore who are considering the software the added confidence to make the transition onto Xero. Xero adoption is an item that is claimable as tax credit or cash back under the Productivity & Innovation Credit scheme.

We also look forward to Xero getting onto the IRAS’ approved payroll software listing in the near future. Until then, we have Xero compatible add-ons SimplePay and Talenox which are on that list, and with advanced HR capabilities.

Incrementally, Xero seems to be moving in the direction of an eventual Singapore specific Xero edition release, with capabilities such as automatic GST reporting, full local payroll support and automatic corporate tax reporting as they have in countries like Australia, UK and New Zealand, which will be a superb outcome for businesses in the country.

 

Sources:
IRAS Accounting Software Register:
https://www.iras.gov.sg/irashome/Businesses/Self-Employed/Getting-it-right/IRAS-Accounting-Software-Register/

IRAS Supporting Payroll Software Vendors:
https://www.iras.gov.sg/IRASHome/Businesses/Employers/Auto-Inclusion-Scheme–AIS-/Supporting-Payroll-Software-Vendors/

 

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