Singapore Income Tax for Foreigners and Permanent Residents

Singapore has some of the lowest individual tax rates in the world, making it an attractive option for high-net-worth individuals from all over the world. In this post, we’ll go over some of the most important aspects of the Singapore income tax for foreigners and permanent residents. 

Key facts of the Singapore income tax for foreigners and permanent residents

Key points of Singapore income tax for foreigners and permanent residents include:

• Singapore currently has a progressive personal income tax rate that starts at 0% and rises to 22 percent after you earn more than S$320,000.
• Individuals are only taxed on their earnings in Singapore. With a few exceptions, income received by persons while working abroad is not subject to taxation.
• The tax rules vary depending on the individual’s tax residency.
• The tax filing due date for individuals is April 15 of each year. Income tax is calculated based on the previous year’s earnings.

Note: From YA 2024, the income tax rate for non-resident individuals (except on employment income and certain income taxable at reduced withholding rates) will be raised from 22% to 24%. This is done to ensure parity between the top marginal income tax rate for non-residents and the top marginal income tax rate for residents.

Singapore income tax residency 

The rate of income tax a person pays is determined by their tax residency status. You will be treated as a tax resident for a particular Year of Assessment (YA) if you are a:

• Singapore citizen or  permanent resident who resides in Singapore except for temporary absences; or
• Foreigner who has stayed/worked in Singapore for at least 183 days in the previous calendar year, or  for three years in a row, even if the duration of stay in Singapore is less than 183 days in the first and/or third years; or
• Foreigner who has worked in Singapore for at least 183 days over the course of two calendar years. This rule applies to all employees who entered Singapore, with the exception of company directors, public entertainers, and professionals.

You will be classified as a non-resident of Singapore for tax purposes if you do not meet the standards specified above.

For more details, please refer to our guide on the Corporate Tax Residency in Singapore.

Personal Income tax rates

Individuals living in Singapore are subject to a progressive resident tax rate, detailed below. If your annual income is S$20,000 or more, you must file a personal tax return as a tax resident. If your annual income is less than S$20,000, you do not have to pay tax. However, you may still need to file a tax return if you have been informed by the Singapore tax authority to submit your tax return. It is worth noting that, depending on your age, you may be eligible for further earned income relief to further lower your tax liability.

Resident tax rates

From YA 2024 onwards

Source: IRAS

From YA 2017 to YA 2023

Source: IRAS

Non-resident tax rates

On employment income

Employment income of non-residents is taxed at either a flat rate of 15% or the progressive resident tax rates (see table above), whichever is higher.

On director’s fee, consultation fees, and all other income

Non-residents are currently subject to a 22 percent tax rate. It applies to all income, including rental income from properties, pension, and director’s fees, except for employment income and some income taxable at reduced withholding rates.

Withholding taxes on income of non-resident individuals

When certain non-resident individuals’ income is due and receivable, it is liable to withholding tax. The applicable withholding tax rate is determined by the type of income received, and the YA involved.

Tax on foreign income

Income received from employment outside of Singapore is generally not taxable. This includes earnings deposited into a Singapore bank account. Furthermore, qualifying income derived from a foreign source is not required to be reported.

Foreign income, on the other hand, is taxed if the following conditions are met:

• Foreign employment is a side benefit of working in Singapore. This signifies that the job requires the person to work and travel outside of Singapore, yet the job is based in Singapore.
• The employee is employed by a foreign company in Singapore.
• The income was received through a partnership in Singapore (unless the income qualifies for exemption).
• The individual earned the income outside of Singapore while working for the Singapore government.
• The individual was paid in Singapore for professional, technical, consulting, or other services performed at a foreign location that did not qualify as an established place of business. This includes locations that are used temporarily or for preparatory and auxiliary activities to the main service.

Income exempt from tax

Capital gains: Any income that can be termed capital gains, such as the sale of fixed assets, stocks, bonds, or intangible assets such as goodwill, is not taxed in Singapore.

Dividend income: Singapore does not tax dividends paid by Singapore firms, and in some situations, dividends paid by Hong Kong and Malaysian companies are not taxed as well.

Inheritance: In 2008, Singapore abolished inheritance tax — also known as estate duty — on a deceased person’s assets. The following are examples of estate assets that are no longer taxed:

• immovable property,
• bank accounts,
• publicly listed shares, and 
• items in a safe deposit box

How to file income tax in Singapore

In order to file your income tax in Singapore, you must prepare the following documents and information:

• SingPass/RAS Unique Account (IUA)
• Form IR8A (if your employer is not participating in the Auto-Inclusion Scheme)
• Particulars of your dependents (e.g., child, parent) for new relief claims
• Details of rental income from your property and other income (if any)
• Business Registration Number/Partnership Tax Reference Number (for self-employed and partners only)

If you are a foreign entrepreneur in Singapore, you are highly advised to engage in tax filing services to help you with the tax filing. We can assist you in filing your income tax return with IRAS. The filing process is done online; therefore, you can submit all the required documents and information to us from anywhere while our tax agent will keep in touch with you. 

We hope you find our guide on Singapore income tax for foreigners and permanent residents useful. If you need assistance in calculating your tax and filing your tax returns, you can always count on us. Leave us a message, and our expert will be available for you in no time. 

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