Detailed Information About Personal Tax in Singapore That You Should Know

All over the world, the rates of Singapore’s personal income tax are one among the smallest. However, you require to discover the chargeable income amount and the tax residency to know the liability of the Singapore income tax of a person. If you have difficulty to understand the rules and regulations of Singapore’s income tax, you can take the help of personal income tax services in Singapore at a reasonable price range. Certain important points to know about income tax Singapore for individuals are as follows:

  • Singapore pursues a continuous tax rate that starts at 0% and ends at 20%.
  • No involvement of inheritance taxes or capital gains.
  • Taxes are charged on the earned income by the individuals in Singapore.
  • The rules of tax Singapore vary on the basis of an individual’s tax residency.
  • The evaluation of income tax is done based on a foregoing year.

Singapore Personal Income Tax Guide for Foreigners

As a foreigner, if you are aiming to settle and work in Singapore, it has a lot of benefits. You can not only live and work in the best place in Asia but also travel to other great nations of South-east Asia like Thailand, Malaysia, Cambodia, Vietnam with not more than a two-hour flight from Changi airport. On top of that, Singapore has people-friendly tax policies for tax-resident foreigners in Singapore. The IRAS (Inland Revenue Authority Singapore) claim that non-Singapore Permanent Residents and non-Singaporeans are considered as foreigners for the purposes of tax. Depending on the tax-residency status, such individuals are accountable to income tax on all income accrued in or derived from Singapore. At this time, personal income tax services in Singapore can bring many benefits to you.

There are various reputed enterprises who offer a wide range of personal income tax services in Singapore at affordable rates. Their services usually include e-Filing, filing with the use of paper-based tax returns, filing income tax, allocation of profit and loss to partners, and so on. When it comes to personal income tax rates, it is mandatory for Singapore tax resident to file a personal tax return if the yearly income is S$22,000 or above. The tax residents with annual income less than S$22,000 do not need to pay tax. However, if you have been informed by the Singapore tax authority to submit the tax return, you might require to submit your tax return.

The three conditions that assert you are a tax resident are:

  • If you are Singaporean
  • If you have established your permanent home in Singapore or if you are a Singapore Permanent Resident
  • If you are a foreigner who has worked or resided in Singapore for 183 days or above in the tax year

For tax residents, the chargeable income subject to taxation is ascertained as total income, expenses, personal reliefs, and donations. However, you will know about these aspects when you will hire personal income tax services in Singapore. The income tax service providing companies will guide you each and everything about the Singapore personal income tax.

How to File Personal Income Tax Returns?

Every eligible taxpayer should file a yearly tax return. The filled forms should be submitted to the tax authority of Singapore. You can either submit your tax returns by mail or online. Upon request, the IRAS will send the proper paper tax online form to you for the purpose of filing tax returns. Those forms are nothing but form B1 (for tax resident individuals), Form M (for non-resident individuals), and Form B (for self-employed). If you file late or do not file, you will be subjected to penalties. You might also tend to encounter legal actions taken by IRAS for non-payment of the tax or non-filing of tax returns. However, income tax service providing companies will always be there to help you with their effective personal income tax services in Singapore.

They will tell you about the tax bill or notice of assessment that you will receive after filing your returns. The tax bill shows that you have to pay the amount of tax. If you do not agree with the amount of your tax, you should inform the tax authority of Singapore within 30 days from the date of your tax bill by stating your reasons for the objection. If the Singapore tax authority finds that your tax remains unpaid even after 30 days, you will be imposed with penalties. Anyhow, these processes are controlled under personal income tax services in Singapore with the assistance of tax professionals. As per IRAS guidelines, it is mandatory to file all tax returns by April 15 every year. The deadline is extended to April 18 if an individual is using the IRAS e-filing portal.

Treatment of Tax Income Earned Overseas

In Singapore, overseas income obtained on or after 1st January 2004 is usually not considered taxable. This involves overseas income that is paid into a bank account of Singapore. You do not require to proclaim non-taxable overseas income. However, there are several conditions in which overseas income is considered taxable:

  • Your overseas job is secondary to your Singapore job. Therefore, you require to travel overseas as part of your work in Singapore.
  • You are doing a job outside Singapore in the interests of the Singapore Government.
  • It is obtained by the way of partnerships in Singapore.

In your tax form, you require to state the qualified taxable overseas income under ‘other income’ and ‘employment income’ whichever applicable. Personal income tax services in Singapore will definitely assist you even in this sector.

Treatment of Tax for the Benefits of Employer

The profits or gains comprise all benefits whether paid or granted to you in regards to employment or else in money. Few instances of taxable benefits gained from your employer:

  • The car offered by an employer
  • Housing and accommodation allowance
  • Overtime payments
  • Reimbursements of dental and medical treatments for dependents other than your children, spouse, and yourself.
  • Fixed monthly meal allowance
  • Fixed monthly transport allowance
  • Per diem allowances

All of these tax treatments come under the personal income tax services in Singapore which you will come to know when you will hire the most effective income tax service providing company. Therefore, one should always look for leading companies in Singapore who render efficient services at competitive prices.

Methods to Save Tax that You Can Opt

There are numerous ways that you can opt to save tax which is as follows:

  • You can declare expenses experienced against your employment income and take the joy of tax deductions for accepted donations of the charitable.
  • If you are a tax resident, you can receive tax reliefs to counterbalance against your assessable income.
  • If you are working for a foreign employer and want to traverse overseas for work purposes, you can enjoy the time apportionment of employment income below the Area Representative Scheme.
  • As per the Avoidance of Double Taxation Treaties, you can be safeguarded from being double-taxed in Singapore.
  • Below the NOR ( Not Ordinarily Resident) scheme, you can either enjoy tax exemption of the contributions of the employer to Overseas Pension Fund or Time Apportionment of Singapore employment income.

These ways will be guided by tax professionals under personal income tax services in Singapore.

Use GIRO for the Payment of Taxes

For using GIRO, you can register with GIRO. However, there are certain methods to sign up which are given below:

  • Apply GIRO online through internet banking (for OCBC and DBS/POSB customers)
  • Make use of the GIRO form given on the payment slip that is sent to you with the Notice of Assessment (for UOB, OCBC, HSBC, and DBS/POSB customers).
  • Anywhere on the web portal, you can download the GIRO application form and send it to income tax service forwarding companies. The rest will be taken care of by the tax professionals as part of personal income tax services in Singapore.

When it is about the operation of GIRO, you can either choose a one-time GIRO deduction or you can have interest-free installments of 12 months. The GIRO installment cycle of 12 months begins in May and finishes in April of next year. If you register with GIRO after the month of May, the deduction of the installment will start in the month after your GIRO form is accepted and finishes in April in the coming year. However, it is very important to recruit personal income tax services in Singapore to know everything in detail about the facts of income tax and its procedures.