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Taxation

When you start to work, one of the things you’ll get used to – besides peak-hour traffic – is paying taxes.

Obviously, the lower the country’s tax rate, the more you’ll have left to spend every month. And this is one reason that makes Singapore an ideal place to work - Singapore’s tax rates are among the lowest in the world.

Tax Payable

The amount of personal income tax you have to pay depends on whether you are a tax resident or non-resident, and the income you earn.

Different tax rates apply for tax residents and non-residents. You will be treated as a tax resident for a particular Year of Assessment (YA) if you are a:

  • Singaporean;
  • Singapore Permanent Resident (SPR) if you have established your permanent home in Singapore; or
  • Foreigner who stayed/worked in Singapore for at least 183 days or more in the previous year (excludes director of a company).

All others are considered non-residents for a particular YA for Singapore tax purposes.

If you are a tax resident, you will be taxed on any income you earn in. Overseas income that is tied to employment in Singapore and brought into the country is taxable. Otherwise, your global sources of income are not taxed. Singapore has a progressive tax structure. After deducting personal relief, personal income tax rates are between 0-20%. To find out more about Singapore’s tax rates, visit the IRAS website.

You may claim personal reliefs, academic tuition fees and insurance premiums. Here is more information about personal reliefs.

If you are a non-resident and have been employed for 60 days or less in a calendar year, the good news is: you are exempt from paying tax (unless you are a director, public entertainer or practising a profession in Singapore). Non-residents are taxed only on income earned in Singapore at a flat rate of 15% or the resident rates, whichever is higher. Non-residents may not claim for personal reliefs.

For more information, visit the IRAS website.

Avoidance of Double Taxation

Singapore has signed agreements with other countries to relieve double taxation of income earned by an individual that is living in another country. If you are a tax resident of one of these countries, you may be protected from being taxed twice. For more information, visit the IRAS website.

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