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Taxation of Individuals in Singapore

Updated on Thursday 19th May 2016

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Taxation-of-Individuals-in-SingaporeThe personal income tax applied in Singapore

Individuals are taxed on their personal incomes depending on their tax residency status in Singapore. Considering Singapore has one of the lowest rates for the personal income tax, being registered for taxation purposes in this country may bring many advantages. Foreign citizens may also be treated as tax residents provided that they have a Singapore permanent residence visa or if they have worked in the country for at least 183 days in a calendar year. The personal tax rate applies progressively: it starts at 0% and ends at 20%. Individuals are only taxed on the income they earn in Singapore.

The taxation of individuals residing in Singapore

The first step for the taxation of individuals in Singapore is to determine tax residency and then the applicable rate based on the Year of Assessment. The Year of Assessment is necessary because of the progressive tax rates which will change every few years. Once the tax residency is established, the personal income tax applies on the chargeable income of the individual. Our agents in Singapore may provide you with more information about the determination of the chargeable income. The personal income tax will then be applied at the following rates:

  • - 0% for incomes below 20,000 SGD,
  • - 2% for incomes between 20,000 and 30,000 SGD,
  • - 3.5% for incomes between 30,000 and 40,000 SGD,
  • - 7% for incomes between 40,000 and 80,000 SGD,
  • - 11% for incomes between 80,000 and 120,000 SGD,
  • - 18% for incomes between 120,000 and 320,000 SGD,
  • - 20% for incomes above 320,000 SGD.

Considering tax rates change, it is best to contact our specialists in Singapore for information about the applicable rates for each year.

The taxation of foreign citizens in Singapore

Foreign citizens working or living in Singapore for at least 183 days in a calendar year will be subject to the personal income tax on their earnings in the country. Foreign citizens will be exempt from taxation if they have a short-term employment contract with a Singapore company. However, directors and professionals will be required to pay the personal income tax. In all other cases, incomes from employment will be taxed at a 15% rate or at the progressive rate depending on which tax is higher.

For personalized accounting services in Singapore you may rely on our consultants.

 

 

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