Know the tax requirements
Wherever you are in the world, its important to understand the taxes you are subjected to. If you’re unsure, it may be wise to seek financial advice. This way you will be able to know exactly what the tax requirements are and how they affect you.
Stay in-the-know when it comes to finance laws – especially those relating to taxes and investments of Singapore and your home country. You’re still a citizen of your country, so you may still be affected by certain tax laws.
In Singapore, it is mandatory under law to file for your annual personal tax returns to IRAS by 15th April of every year (E-filing deadline: April 18). Inland Revenue Authority of Singapore (IRAS) enforces the requirements relating to the filing of the personal tax. Failure to file by this date may result in a fine. You can usually expect to receive the income tax bills from May to August.
- The amount of income tax that you have to pay depends on your tax residency in Singapore. The taxes for residents are different from non-residents.
- Top marginal resident tax rate of 22% kicks in at S$320,000 of taxable income.
- Non-residents are taxed at the flat rate of 15% or the resident rates whichever results in a higher tax amount.
- In general, all remuneration arising from employment under which duties are performed in Singapore would be fully taxable irrespective of where the funds are made available to you
- Besides salaries and bonuses, perquisites such as housing and stock options will form part of your taxable employment income.
Deductions and Personal Reliefs?
You may be able to claim tax deductions on employment expenses ‘wholly and exclusively’ incurred in earning your income. This means you used your own money to pay for expenses necessary to your employment such as travel expense, entertainment expense, subscriptions, etc
Qualified course or tuition fees, earned income relief, parent relief and support of dependents, professional development expenses and premiums paid on life insurance policies, and any other special reliefs.
Capital gains: Singapore does not tax any income that can be considered capital gains including the sale of fixed assets, stock or bonds or intangible assets such as goodwill.
Dividend income: Singapore does not tax dividends issued by Singapore companies; in certain cases, dividends from Hong Kong and Malaysia based companies are also not taxed.
If you would like a guide to how much tax you may be liable for, IRAS have provided tax calculators to help individuals to budget for their income tax liability. These can be found here.
Filing taxes
Personal taxes can be filed online or by mail. To file, IRAS requires each taxpayer to file one of the following forms based on his or her occupation and tax residency status:
- Form B1 – Employed individuals
- Form B – Self-employed individuals
- Form M – Non-resident individuals
After taxes have been filed, the Singapore government will issue to the individual a tax bill known as a Notice of Assessment (NOA) between May and September. Once the the NOA has been received, the individual has 30 days to pay the taxes due.
If the individual disagrees with the NOA, they can file an Objection of Assessment to correct the tax bill. An Objection of Assessment must be filed within 30 days of receiving the tax bill. Note that the individual is still obligated to pay the full amount on the NOA within 30 days even if he or she disagrees with the tax bill.
If taxes are not paid within 30 days, IRAS will issue a penalty currently 5% of the amount due.
Resident Tax Rates
| Chargeable Income | Rate (%) | Gross Tax Payable ($) |
| On the first 20,000
On the next 10,000 |
0
2 |
0
200 |
| On the first 30,000
On the next 10,000 |
–
3.50 |
200
350 |
| On the first 40,000
On the next 40,000 |
–
7 |
550
2,800 |
| On the first 80,000
On the next 40,000 |
–
11.5 |
3,350
4,600 |
| On the first 120,000
On the next 40,000 |
–
15 |
7,950
6,000 |
| On the first 160,000
On the next 40,000 |
–
18 |
13,950
7,200 |
| On the first 200,000
On the next 40,000 |
–
19 |
21,150
7,600 |
| On the first 240,000
On the next 40,000 |
–
19.5 |
28,750
7,800 |
| On the first 280,000
On the next 40,000 |
–
20 |
36,550
8,000 |
| On the first 320,000
In excess of 320,000 |
–
22 |
44,550 |
If you would like information on any of the above areas or any other areaa of financial planning, please contact.
Matt Baker, Managing Director, Singapore Expat Advisory
Email: advice@sinaporeexpatadvisory.com
Tel/Whatsapp Business +65 9432 8781
www.singaporeexpatadvisory.com
Singapore Expat Advisory is an agency for Promiseland Pte. Ltd and are authorised and regulated by the Monetary Authority of Singapore (MAS).
General Information Only This article should not be construed as an offer, solicitation of an offer, or a recommendation to transact in any products (including funds, stocks) mentioned herein. The information does not take into account the specific investment objectives, financial situation or particular needs of any person. Advice should be sought from a licensed financial adviser regarding the suitability of the investment. This article has not been reviewed by the MAS