Resident individuals are subject to tax on income accruing in or derived from Singapore or received in Singapore from outside of Singapore.
However, overseas income received in Singapore on or after 1 January 2004 is generally not taxable.
Taxpayers are assessed on a calendar year and tax is computed on a preceding year basis. Taxpayers must file a tax return by 15 April in the following year.
In addition, expatriate individuals can opt for the Not Ordinarily Resident scheme if he spends at least 90 days outside of Singapore for business reasons in respect of his Singapore employment and his total Singapore employment income is at least SGD160,000.
Income tax is imposed on the basis of territoriality.
All foreign income received by individuals in Singapore is exempt from tax where the tax authority is satisfied that the exemption will be beneficial to them, unless received through a partnership. Foreign dividends, branch profits and service fees received through a partnership may be exempt subject to conditions.
Singapore impose a Good and Services Tax of 7%.
There is no tax on capital gains. However, gains from the realization of capital assets can be included in ordinary business income and subjected to income tax if the sales were carried out in the course of a trade carried on by the taxpayer.
Individuals are tax at progressive rates and the top tax rate is 20% for income over SGD320,000.
Royalties received in connection with literary, dramatic, musical or artistic work or from a local or branch of a foreign publisher are taxed at a concessionary rate of 10% of the gross amount.
Separate tax returns are required.
Termination payments which are compensation attributable to the loss of employment such as redundancy are not taxable.
Yes. Share options granted by virtue of an employment are a taxable benefit and the gains accrue as income in the year in which the option is exercised. The taxable value is the open market value at the time of the exercise less the amount paid for the share option.
An individual who leaves Singapore permanently is deemed to have derived a gain from the unexercised or restricted stock option plan, unless his employer is granted approval to keep track of the options. If the subsequent actual gain is less than the taxable gain, the taxpayer can apply for a reassessment of his tax liability.
The employer of an expatriate is required to notify the tax authorities and withhold the salary for the purposes of tax clearance should the expatriate cease employment in Singapore, or leave Singapore for a period of more than 3 months.