Personal income tax for foreigners in Singapore: A complete guide

After setting up a company in Singapore, many businesses want to bring key employees to work and manage the company.. In addition to issues such as application procedures,work visa (EP), looking for a company office, another major concern is personal income tax in Singapore. This includes tax rates, tax filing methods, and other related issues for foreigners living and working there.

In this in-depth article, we will provide businesses with detailed information about the personal income tax system for foreigners in Singapore.

1. Overview of Singapore's personal income tax system for foreigners

Similar to other countries, Singapore's personal income tax system for foreigners is classified into two categories:

The personal income tax payable in Singapore depends on:

• Income received in Singapore.
• Tax residency status – whether the individual is a tax resident or non-tax resident.

Singapore's personal income tax is calculated based on the preceding year’s income. For example, the Year of Assessment 2025 refers to income earned from 1 January 1 to 2024 December 31.

2. Tax rates for tax resident in Singapore

Singapore's personal income tax rates for resident taxpayers follow a progressive system. This means that higher income earners pay higher tax rates, with the top tax rate currently set at 24%.

Individuals with an Employment Pass valid for at least one year are generally considered tax residents. However, their final tax residency status is determined at tax clearance when they stop working in Singapore. If they have stayed in Singapore for less than 1 days, they will be classified as non-residents.

Resident taxpayers in Singapore pay tax at progressive rates and are eligible for tax concessions.

2.1. Personal income tax system in Singapore for resident individuals

Singapore applies a progressive personal income tax rate for resident individuals, ranging from 0% to 22%, depending on taxable income.

Individuals/Businesses who want to compare personal income tax rates in Singapore and other countries (Hong Kong, USA, Belize, BVI, etc.) can visit GLA Tax Comparison Tool all around the world. 

GLA Tax Comparison Tool provides comprehensive comparison and overview of personal income tax, corporate income tax, sales tax (VAT/GST) of countries around the world (Singapore, Hong Kong, USA, Offshore (BVI, Belize, Seychelles, etc.)

2.2. Personal income tax reduction in Singapore

In Budget 2024, a personal tax credit will be granted to all tax residents in the 2024 Assessment Year. The credit will be 50% of the tax payable, up to a maximum of $200.

Individuals do not need to request or apply for tax rebates. The Singapore Inland Revenue Authority (Inland Revenue Authority of Singapore (“IRAS”)) will automatically calculate and issue rebates to all tax filers.

3. Tax rates for non-resident individuals in Singapore

A non-tax resident individual in Singapore will:

• Be taxed on all income earned in Singapore.
• Claim expense deductions and donations to save taxes.
• Earned income is taxed at a higher rate:
  • Fixed rate 15%; or
  • Progressive resident tax rates.
• Taxed at 24% on director fees, consulting fees and all other income.

3.1. How can non-tax resident in Singapore calculate their personal income tax?

Individuals who are non-residents and work in Singapore for 60 days or less in a year, income from short-term personal employment will be tax free You can refer to detailed information on Singapore's personal income tax exemption policy from IRAS here.

Note:

• This rule does not apply if the individual receives payment as a board director, public entertainer or professional in Singapore.
• This rule does not apply if the individual's stay lasts for three consecutive years or more.

Tax on employment income

Non-resident individuals' employment income is taxed at a flat rate of 15% or the progressive resident tax rate (see table above), whichever is higher.

Tax on directors' fees, consulting fees and all other income

The tax rate for non-resident individuals is currently 24%, and applies to all income including rental income, pensions and directors' fees, except for employment income and certain income which is taxed at reduced withholding rates.

[New] From 2024, the income tax rate for non-resident individuals (except for employment income and certain income taxable at reduced withholding rates) will increase from 22% to 24%. This is to maintain parity between the non-resident income tax rate and the top marginal income tax rate for residents.

3.2. Tax deduction on income of non-resident individuals

Certain income of non-resident individuals is subject to withholding tax when due and collectible. The applicable withholding tax rate depends on the type of income derived and the YA involved.

Withholding tax rate from YA 2024 onwards:

4. How can you submit your Singapore personal tax return?

4.1 When do you need to file tax?

Individual must submit personal income tax return if in the previous calendar year if:

1. Have a total income of more than $22.000; or
2. Have income from self-employment with net profits of more than $6.000; or
3. Be a non-tax resident and have income from Singapore.

Time to file personal income tax return in Singapore

The deadline for filing personal income tax returns in Singapore depends on the filing method:

• Apply online: Deadline April 18.
• Hard copy submission: Deadline April 15.

To pay taxes to the Singapore government, foreign individuals can pay through a bank account, ATM, Internet Banking, Cheque or GIRO account (an account linked to Singapore government agencies and allowing individuals to pay taxes in installments with 0% interest rate).

In case of payment by bank account, the individual must pay the tax in full within one month from the date of receipt of notice from the Inland Revenue Authority of Singapore (IRAS). 

Tax payment extension

If an individual needs more time to file his/her Singapore income tax return, he/she may be granted an extension of up to 14 days upon prior notice to IRAS.

5. Other notes on personal income tax for foreigners residing in Singapore

5.1. Taxable income and tax-free income

In addition to wages and bonuses, income from securities, other benefits that individuals receive from work are also considered taxable income.

Foreign-sourced income, dividends and bank interest arising in Singapore will be exempt from personal income tax in Singapore.

5.2. Leasing of real property of individuals in Singapore

Any rental payments an individual receives when renting out his or her property in Singapore are subject to income tax and must be declared in the income tax return.

5.3. Regularly update address and contact information

To facilitate electronic tax filing as well as receiving notifications from the Singapore Tax Department, foreign individuals should apply for personal tax identification numbers, etc. on the Singapore government website.

To better understand the electronic tax filing process in Singapore, please contact us for the best advice.

5.4. Tax settlement

If an individual is preparing to leave Singapore or change to another job in Singapore, the individual must pay all his or her tax liabilities.

This process is called tax finalization. For tax finalization, the individual's current employer must notify the Inland Revenue Authority of Singapore (IRAS) and ensure that the individual has paid all taxes before the individual ends his or her current employment.

6. Penalties applied to individuals who do not declare personal income tax as prescribed

Theo Income Tax Act of 1947, taxpayers may face the following consequences if they file false returns:

Circumstances: Without reasonable excuse or due to negligence

1. Penalty up to 200% of tax arrears.
2. Fines up to $5.000; and/or
3. Imprisonment up to three years.

Case: Intentional tax evasion

1. Penalty up to 400% of tax arrears.
2. Fines up to $50.000; and/or
3. Imprisonment up to five years.

The Inland Revenue Authority of Singapore (IRAS) will notify the taxpayer of the penalty amount and the due date for payment. IRAS will also explain the reasons for imposing the penalty.

7. How does GLA support businesses in declaring personal income tax in Singapore?

Global Link Asia Consulting provides a comprehensive and professional service to support businesses in declaring personal income tax in Singapore, including:

• Get detailed information on the personal income tax system in Singapore, including regulations, tax rates, tax calculation methods, etc.
• Support businesses in collecting necessary information and documents to declare personal income tax in Singapore.
• Check the accuracy and completeness of tax returns.
• On behalf of the Enterprise, submit tax declaration documents to the Singapore Internal Revenue Service (IRAS).
• Track and update tax payment status of the Enterprise.
• Answering questions from businesses related to personal income tax declaration in Singapore.

8. FAQs about personal income tax in Singapore

Highlights

• Tax rates for tax residents are 0-24% depending on income.
• Individuals must file their personal income tax returns in Singapore with the Inland Revenue Authority of Singapore (IRAS) by April 18.
• Personal income tax rates for countries around the world can be easily looked up with GLA Exclusive Tax Comparison Tool. 
• For more details on income tax for Singapore companies, businesses should refer to the following article: Singapore corporate tax in detail, easy to understand.