Singapore’s Personal Income Tax structure is one of the friendliest and most competitive in the world. Personal income tax is payable annually on a preceding year basis. Overseas income received in Singapore is not taxable. This, however, does not apply to overseas income received in Singapore through partnerships in Singapore.
What is taxable income?
Almost all income accrued in Singapore by a person or business is subject to income tax. All sales transactions that occur in Singapore or monies received in Singapore are taxable. Taxable income includes income from your business, salary from employment, interest earned on your deposits and rental income. For the purpose of taxation the Inland Revenue Authority of Singapore (IRAS) has assigned two categories of taxpayers – Tax Residents and Non-residents.
Who is a tax resident?
Tax rates differ on the basis of residency of the taxpayer. For the purpose of taxation an individual is considered a tax resident for a particular Year of Assessment (YA) if he/she is:
- A Singapore citizen or permanent resident who resides permanently in Singapore.
- A foreigner who has stayed/worked (but not in the capacity of company director) in Singapore for 183 days or more, in the year preceding the YA.
Personal Income Tax Rates for Tax Residents
Personal income tax rates follow a progressive pattern where the rate ranges from 0%-20%. The maximum tax rate, for income above S$320,000, has been reduced over time and has reached the present rate of 20% since YA 2007.
| Chargeable Income (S$) | Rate (%) | Gross Tax Payable (S$) | |
|---|---|---|---|
| On the first On the next |
20,000
10,000 |
0
3.50 |
0.00
350.00 |
| On the first On the next |
30,000
10,000 |
5.50
|
350.00
550.00 |
| On the first On the next |
40,000
40,000 |
8.50
|
900.00
3,400.00 |
| On the first On the next |
80,000
80,000 |
14
|
4,300.00
11,200.00 |
| On the first On the next |
160,000
160,000 |
17
|
15,500.00
27,200.00 |
| On the first Above |
320,000
320,000 |
20
|
42,700.00
|
What is chargeable income?
Chargeable income is the net income after deduction of expenses, donations, and personal relief.
Personal tax relief, subject to conditions, includes support of dependents, academic tuition, professional development expense and premiums paid on life insurance policies.
Who is a Non-resident taxpayer?
All other individual taxpayers who are not tax residents are known as non-residents and are subject to withholding tax. For more information on withholding tax please go to Singapore Withholding Tax
All taxpayers are subject to filing of annual tax returns with IRAS for the YA based on income earned in the preceding year. The tax filing due date is April 15 of YA. For instance, income earned in Singapore during the calendar year of 2009 needs to be reported in individual tax return due by 15 April, 2010.
To meet your needs, Rikvin accounting services offer personal tax computation and submission of annual returns to IRAS. For more information on how to engage our service please go to Services and Fees page.
Related Topics
Singapore TaxationSingapore Withholding Tax
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