Verified Facts
The tax rates in Singapore range from 2% to 22% for personal income tax, with a corporate tax rate of 8.5% to 17%, and a goods and services tax (GST) of 7%, making it a relatively low-tax jurisdiction.
Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. This is a general guide only.
Quick Facts
Tax System Overview
Singapore has a territorial taxation system, which means that only income earned in Singapore is subject to tax, regardless of the individual's or company's tax residency status. However, individuals who are considered tax residents in Singapore are also taxed on their foreign-sourced income, but they may be eligible for foreign tax credits to avoid double taxation. The tax residency rules in Singapore are based on the number of days an individual spends in the country, with those spending 60 days or more in a calendar year considered tax residents.
The tax system in Singapore is designed to be business-friendly and competitive, with a focus on encouraging foreign investment and entrepreneurship. The government offers various tax incentives and schemes to support businesses, particularly small and medium-sized enterprises (SMEs). The tax authorities in Singapore, the Inland Revenue Authority of Singapore (IRAS), are responsible for administering the tax system and providing guidance to taxpayers.
Personal Income Tax
| Income Bracket (SGD) | Tax Rate |
|---|---|
| 0 - 20,000 | 2% |
| 20,001 - 30,000 | 3.5% |
| 30,001 - 40,000 | 7% |
| 40,001 - 80,000 | 11.5% |
| 80,001 - 120,000 | 15% |
| 120,001 and above | 22% |
| Taxpayers in Singapore are eligible for various deductions and allowances, such as the earned income relief, parent relief, and qualifying child relief. The tax filing deadline is typically April 15th of each year, and taxpayers can file their tax returns online through the IRAS website. Taxpayers may also be required to make estimated tax payments throughout the year if their tax liability exceeds a certain threshold. |
Corporate & Business Tax
- The corporate tax rate in Singapore is 8.5% for companies with a taxable income of up to SGD 300,000, and 17% for companies with a taxable income above SGD 300,000.
- Small businesses with a turnover of up to SGD 1 million may be eligible for the SME cash grant, which provides a cash payout of up to 5% of their total revenue.
- Companies can also take advantage of tax-free zones, such as the Singapore FreePort, which offers a range of tax exemptions and incentives.
- To register a business in Singapore, companies must first incorporate with the Accounting and Corporate Regulatory Authority (ACRA) and then register for taxes with the IRAS.
- Companies may also be required to withhold taxes on payments made to non-resident individuals and companies.
VAT / Sales Tax
- The standard GST rate in Singapore is 7%, which is applied to most goods and services.
- There are also reduced GST rates of 0% and 5% for certain goods and services, such as basic groceries and healthcare services.
- Some goods and services are exempt from GST, such as financial services and residential properties.
- Tourists may be eligible for a GST refund on purchases made in Singapore, provided they meet certain conditions, such as spending at least SGD 100 in a single receipt.
For Expats & Foreign Workers
- Expats and foreign workers are considered tax residents in Singapore if they spend 60 days or more in the country in a calendar year.
- Singapore has a double taxation agreement with over 80 countries, which helps to avoid double taxation on income earned by expats and foreign workers.
- Expats and foreign workers may be eligible for tax reliefs on their foreign-sourced income, such as the foreign earned income exclusion.
- Expats and foreign workers are also required to register for taxes with the IRAS and obtain a tax identification number.
- Expats and foreign workers may be subject to social security contributions, such as the Central Provident Fund (CPF) scheme.
- Expats and foreign workers must comply with remittance rules, which require them to report and pay taxes on income remitted to Singapore.
Crypto & Investment Income
- Investment income, such as dividends and interest, is subject to tax in Singapore, but there are tax exemptions for certain types of investment income, such as dividends paid by Singapore companies.
- Capital gains are not subject to tax in Singapore, but there may be tax implications for gains realized on the sale of certain assets, such as property.
- Cryptocurrency is considered a goods for tax purposes in Singapore, and gains realized on the sale of cryptocurrency are subject to tax.
- Taxpayers must report their investment income and gains on their tax returns, and may be required to pay taxes on their investment income.