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    Tax Residency

    The tax liability of companies and individuals in Singapore is dependent on their tax residency status.

    Resident vs. non-resident companies 

    In Singapore, a company is either a resident or a non-resident. The Inland Revenue Authority of Singapore (IRAS) determines residency by where the company is controlled and managed, or in other words, where it makes decisions on strategic matters. This means that a company’s residency is not necessarily the location of where it is incorporated. 

    For example, a company might be incorporated in Singapore, but be considered a non-resident if decisions are de facto made in another jurisdiction, such as Hong Kong or London. One factor in determining residency – but not necessarily the only one – is where the company holds its Board of Directors meeting. 

    Resident vs. non-resident individuals 

    Singapore citizens and Singapore permanent residents are both considered tax residents. Foreigners are considered tax residents if they:

    • Have stayed or worked in Singapore for (a) more than 183 days in a calendar year in the previous Year of Assessment (YA), or (b) continuously for three consecutive years; or
    • Have worked in Singapore for a continuous period spanning two calendar years with the total duration of stay exceeding 183 days, including physical presence in Singapore before and after the start of work.

    The IRAS classifies non-resident individuals into three different categories: foreign professionals, public entertainers, and board directors. Residency for all three categories depends on whether they spend less than 183 days in a calendar year in Singapore, but they have different obligations for tax purposes. 

    A professional is a non-resident if they are in Singapore for less than 183 days in a calendar year. Examples of foreign professionals include foreign experts or consultants invited to Singapore to share knowledge or expertise with an organization, an academic attending a seminar or workshop, or an individual operating via a foreign company. 

    Foreign public entertainers are those who visit Singapore to perform, such as musicians, dancers, actors, and athletes, and spend less than 183 days in the country. They are classified as public entertainers regardless of whether they are working as individuals or as employees. The IRAS does not include individuals who assist public entertainers with their performances in this category, such as audio crewmembers, choreographers, coaches, and personal trainers. 

    Finally, board directors, or company directors, are non-residents if they spend less than 183 in a calendar year in Singapore. A board director may also hold another role within a company, such as a chief executive officer or managing director, but they are only considered a board director for income derived in that role. 

    Tax Rates

    Singapore taxes all income earned in Singapore and any foreign-sourced income brought into Singapore prior to January 1, 2004. Foreign-sourced income brought into Singapore after January 1, 2004, is tax-exempt.

    Singapore levies a progressive individual income tax (IIT) rate on tax residents, with the headline IIT rate currently at 22 percent. The progressive tax rates on chargeable income for tax residents are as follows:

    Chargeable Income

    Credit

    Exemption

    First S$20,000 (US$14,888)

    0

    S$0

    Next S$10,000 (US$7,444)

    2

    S$200 (US$148)

    First S$30,000 (US$22,329)

    -

    S$200 (US$148)

    Next S$10,000 (US$7,444)

    3.5

     S$350 (US$260)

    First S$40,000 (US$29,772)

    -

    S$550 (US$409)

    Next S$40,000 (US$29,772)

    7

    S$2,800 (US$2,083)

    First S$80,000 (US$59,537)

    -

    S$3,350 (US$2,492)

    Next S$40,000 (US$29,772)

    11.5

    S$4,600 (US$3,422)

    First S$120,000 (US$89,306)

    -

    S$7,950 (US$5,915)

    Next S$40,000 (US$29,772)

    15

    S$6,000 (US$4,464)

    First S$160,000 (US$119,076)

    -

    S$13,950 (US$10,379)

    Next S$40,000 (US$29,772)

    18

    S$7,200 (US$5,357)

    First S$200,000 (US$148,845)

    -

    S$21,150 (US$15,737)

    Next S$40,000 (US$29,772)

    19

    S$7,600 (US$5,654)

    First S$240,000 (US$178,576)

    -

    S$28,750 (US$21,391)

    Next S$40,000 (US$29,772)

    19.5

    S$7,800 (US$5,803)

    First S$280,000 (US$208,338)

    -

    S$36,550 (US$27,194)

    Next S$40,000 (US$29,772)

    20

    S$8,000 (US$5,952)

    First S$320,000 (US$238,101)

    -

    S$44,500 (US$33,111)

    Excess S$320,000 (US$238,101)

    22.5

     

    Source: iras.gov.sg

    Non-tax residents are taxed either at a flat rate of 15 percent or at the progressive tax rate detailed above, depending on which amount is higher. However, the fees and remuneration of non-resident directors and consultants are taxed at a flat rate of 22 percent. 

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