Taxation

Non-resident individuals are taxed at a flat rate of 22% (24% from year of assessment 2024), except that Singapore employment income is taxed at a flat rate of 15% or at resident rates with personal reliefs, whichever yields a higher tax.15 Feb 2022

Income from a trade, business, profession or vocation paid to a non-resident is taxed at 22%. Income from professional services paid to a non-resident is taxed at 15%. This is a final withholding tax on the gross amount, unless the non-resident professional elects to be assessed at a rate of 22% on net income.

Singapore, known as a tax haven, there are several favorable policies for people living and doing business in Singapore. The country offers several tax breaks, boasts a relatively low corporate tax rate and top personal tax bracket, and it does not levy taxes on capital gains.

 

A Personal Income Tax Guide for Foreigners in Singapore

Living and working in Singapore has many benefits. Not only can you pamper yourself with the best place in Asia to live, work and play, you also get to enjoy the other great nations of South-east Asia such as Vietnam, Cambodia, Malaysia, Thailand and Indonesia, which are all not more than two-hours flight away from Singapore’s world-class Changi airport. With one of the lowest tax rates in the world, here’s an overview of the personal income tax guide in Singapore.

In this guide, we present the personal income tax rates for tax-resident foreigners in Singapore, as well as the various rebates and reliefs that they are entitled to.

In general, the Inland Revenue Authority of Singapore (IRAS), Singapore’s tax regulator, treats non-Singaporeans and non-Singapore Permanent Residents as foreigners for tax purposes. Such individuals, depending on their tax-residency status, are liable to income tax on all income derived from or accrued in Singapore. This article covers the following points :

Tax-residency of Foreigners in Singapore

The Singapore tax rate in which a foreigner pays depends on the tax-residency status, with the cut-off periods being 60 days and 183 days. Let’s understand this in detail.

At least 183 days

Under the city-state’s tax residency rules, a foreigner is regarded as a tax resident if he or she stays or works in Singapore for at least 183 days in a calendar year. Notably, the number of counted days includes weekends and public holidays, and any temporary absence from work for overseas vacation or official work.

While the foreigner can claim tax reliefs (discussed below) when filing up the Form B1 applicable to tax-residents, his or her foreign-sourced income brought into Singapore is tax-exempt.

Do note that according to the rules, a foreigner who stays or works in Singapore continuously for three consecutive years, he or she is regarded as a tax resident for all the three years even if the number of days in Singapore is less than 183 days in the first and third year.

The progressive resident rates range from zero to 22 percent with the topmost rates kicking in at S$320,000 annual income as detailed below.