Singapore

EXPATRIATE AND EMPLOYER TAX COMPLIANCE AND ADVISORY
Tax rate Resident tax rates are progessive from 0% to 22% (Income S$20,000 and below will not be taxed)
Non-residents are taxed at the higher of a flat rate of 15% or the progressive resident tax rates for employment income. For taxes on Director’s fee and director’s remuneration are taxed at 22% for non-residents.
Tax period Calendar year
Tax residency / Domicile according to domestic law A person will be treated  as a Singapore tax resident if he/ she fulfills any of the following conditions:
• He/she is a Singapore Citizen or Singapore Permanent Resident who resides in Singapore except for temporary absences; or
• He/she is a foreigner who is physically present or who exercises an employent in Singapore (excludes director of a company) for 183 days or more during the year preceding the year of assessment.
Tax registration Not required, although separate request for income tax return may be required.
Employment income definition All income derived by an employee from his employment which includes salaries, bonuses, allowances, pension/ provident fund contributions made by employer, director’s fee, commission, benefits-in-kind, salary in-lieu of notice/ notice pay as compensation for early resignation or early termination of contract, tax paid by employer.
Certain income may not be taxable, e.g. payments for restrictive convenants, compensation for loss of office and other benefits where are granted administrative concession.
Examples of tax exemption Singapore operates on a terrioritial basis of taxation. That said, any income accrued in or derived from Singapore is subject to tax in Singapore. Foreign income received in Singapore in the hands of a tax resident individual is exempted from tax in Singapore.
In addition, some benefits-in-kind are tax exempt under administrative concession (subject to meeting certain conditions):
• Benefits that foster goodwill or promomte camaraderie among staff;
• Benefits/ perquisites relating to employee’s health etc.
Specific expatriate concession Tax concessions for expatriates are made under the Not Ordinarily Resident (“NOR”) Scheme, Area Representative Scheme, etc.
Income of board members Generally, director’s fee are sourced in the country where the company is resident.
Tax returns Tax returns should be filed by 18 April (e-filing) or 15 April (paper filing) unless further extension has been granted by the Singapore tax authority. We will typically apply for the extension up till end of June upon request.
Tax payments Payment of taxes must be made within one month from the date of the Notice of Assessment, regardless of whether any objection is to be made.
Payment modes include via GIRO, credit card, various electronic payment modes and telegraphic transfer.
TAX TREATIES
Employment income / income from board members Art 15/16 Model OECD Tax treaties
INTERNATIONAL SOCIAL SECURITY
Cross border employments Employer is required to make mandatory contribution to the Central Provident Fund (CPF) for Singapore citizen or Singapore Permanent Resident. When the Singapore citizen or Singapore Permanent Resident leaves Singapore for overseas employment, the employer does not need to make mandatory contribution to the CPF and the individual can make voluntarily CPF contribution up to a capping limit.
Exception under Art 16 of Reg. 883/2004
and Art 17 of Reg. 1408/71
Not applicable
Social Security Cost as % from gross salary and absolute amounts It is a percentage on the gross salary based on the age range for manadatory CPF contribution.
IMMIGRATION
Work permit All foreigners who intend to work in Singapore must have a valid pass before they start work. There are various types of passes (employment pass, S-pass, etc) for different categories of foreigners which include professionals, skilled and semi-skilled workers, trainees and students and family members.
Visa Depending on the nationality, a visa may need to be applied.
Depends on the purpose of staying/living in Singapore, different passes can be applied (such as dependent pass, long-term visit pass, student visa). Each pass has its own restricted activitives conducted in Singapore.
Depends on the passport holder, a visa to enter into Singapore may be required.
Residency permits / registration certificate See above
Driving license Foreigners above 18 years of age and hold a valid foreign licence may drive in Singapore for a period of not more than 12 months. A Singapore driving licence is required after 12 months. For licence not written in English language, an International Driving Permit or an official translation in English language is required.
STOCK OPTION PLAN Specific tax rules on gains arising frorm Employee Share Options and other forms of Employee Share Ownership would be applied.
ARTICLE 15 OF THE OECD MODEL
183 days Yes
Notion of employer More ‘inclined’ to take an economic employer interpretation approach.
Existence of a permanent establishment Depends on the employment relationship between the employer and employee for which the employee may create a permanent establishment for the employer in another jurisdiction based on the level of activities performed/conducted.

 

Gene Kwee
Partner, Head of Taxx
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Direct line:’+65 6591 5963
Address:135 CECIL STREET #10-01 MYP PLAZA, SINGAPORE 069536
www.mazars.sg