Personal Income Tax in Singapore: Rates, Rules & Filing Guide

Personal Income Tax in Singapore

Personal income tax in Singapore is collected by the Inland Revenue Authority of Singapore (IRAS) on all income of individuals earned in the country or received from overseas. Residents will pay tax on a progressive scale starting at 0 percent and reaching 24 percent for chargeable income above SGD 1,000,000 in the Year of Assessment 2024. Non-residents will generally pay a flat rate of 24 percent on most personal income. employment income will be taxed at 15 percent or at resident rates if that results in higher tax. This blog explains who will pay personal income tax, how the system works for individuals and the steps for filing and staying compliant.

Personal Income Tax Rules in Singapore

Personal income tax in Singapore is a direct tax on the income of individuals earned in the country or received in Singapore under specific conditions.The assessment year will run on a preceding year basis so income earned in 2024 will be taxed in the Year of Assessment 2025.

The scope of personal taxable income will include salary, bonuses, allowances, commissions, rental of property, and investment returns. Overseas income will also be taxed if it is received in Singapore under specific conditions set by IRAS.

The residency status of an individual will determine the applicable personal income tax rates and filing requirements. Residents will pay tax on a progressive scale up to 24 percent while non-residents will pay a flat rate on most types of personal income with limited reliefs or deductions available.

Resident and Non-Resident Status

The rate of personal income tax in Singapore will depend on whether an individual qualifies as a resident or a non-resident. Residency status determines which tax scale applies, which deductions can reduce taxable income, and the filing requirements that must be followed each year.

Resident status will apply when

• You are a Singapore Citizen or Permanent Resident who makes Singapore your home for living and working

• You are a foreign individual who stayed or worked in Singapore for at least 183 days in the previous year and presence is proven by records of work or residence

• You worked in Singapore for three continuous years even if one or more years had fewer than 183 days

• You worked across two calendar years and stayed without break for at least 183 days

Non-resident status will apply when

• You stayed in Singapore for fewer than 183 days in a calendar year and do not meet residency requirements

• You came only for short-term employment or business trips and Singapore is not your main place of residence

Personal Income Tax Rates for Residents

Residents of Singapore will pay personal income tax using a progressive rate system where higher income will be taxed at higher rates. The Year of Assessment 2024 rates will apply on the chargeable income of an individual as follows:

• 0 – 20,000 → 0%

• 20,001 – 30,000 → 2%

• 30,001 – 40,000 → 3.5%

• 40,001 – 80,000 → 7%

• 80,001 – 120,000 → 11.5%

• 120,001 – 160,000 → 15%

• 160,001 – 200,000 → 18%

• 200,001 – 240,000 → 19%

• 240,001 – 280,000 → 19.5%

• 280,001 – 320,000 → 20%

• 320,001 – 500,000 → 22%

• 500,001 – 1,000,000 → 23%

• Above 1,000,000 → 24%

Personal Income Tax Rates for Non-Residents

Non-residents of Singapore will pay personal income tax on income earned in the country under a simpler system that generally results in higher rates. The tax will depend on the type of income and the period of stay in Singapore.

• Employment income of a non-resident will be taxed at a flat 15 percent or at resident rates if applying resident rates results in higher tax. This ensures that short-term workers contribute a fair amount of tax while accounting for resident rate differences.

• Director fees, consultancy income, and rental income will be taxed at a flat 24 percent. These types of income do not qualify for progressive rates and are fully chargeable to tax.

• Reliefs and deductions are mostly unavailable for non-residents. This means that taxable income will be fully chargeable and non-residents cannot reduce tax through personal reliefs or rebates available to residents.

Who Must File Personal Income Tax in Singapore

• Income above 22,000 dollars from salary, bonuses, allowances, or other personal earnings will require filing. This applies to residents and ensures that all significant earnings are reported to the Inland Revenue Authority of Singapore.

• Self-employment profit above 6,000 dollars for freelancers, business owners, or contractors will require submission of a tax return. Reporting these profits ensures correct calculation of tax on business or freelance income.

• Non-residents earning income in Singapore from employment, consultancy, or rental will be required to file even if the amount is below the usual thresholds. This ensures all Singapore-sourced income is accounted for under the tax rules.

• Receipt of a notice from IRAS to file a return will mandate filing. Complying with the notice will prevent penalties or interest on unpaid tax and maintain a clear record with the authority.

Filing Process and Deadlines

The personal income tax year in Singapore will run on the calendar year and the income of a person earned in one year will be taxed in the Year of Assessment of the following year. Paper filing will usually close in early April and all forms must reach the Inland Revenue Authority of Singapore before the deadline to avoid penalties.

Electronic filing will usually close around 18 April and allows automatic calculation of the tax payable for faster processing. Filing can be done using a Singpass account which simplifies submission and ensures the return is recorded accurately.

After submission, IRAS will issue a Notice of Assessment starting from the end of April showing the total tax payable. Objections to any assessment must be filed within 30 days of receiving the notice to ensure the dispute is considered and resolved by the authority.

Conclusion

Personal income tax in Singapore will apply to both residents and non-residents. Residents will pay tax on the chargeable income using progressive rates while non-residents will pay most income at flat rates. The residency status of an individual will decide the rates of tax, eligibility for reliefs, and the rules for filing. Filing will be needed when income or self-employment profit goes above the thresholds set by the Inland Revenue Authority of Singapore. Knowing the available reliefs and deductions will reduce tax and prevent penalties. Filing on time will keep a clear record with IRAS and make personal income tax easier to manage.

FAQs

1. Who pays personal income tax in Singapore?
 Anyone earning or receiving income on the territory of Singapore will pay personal income tax. Residents will follow progressive rates while non-residents will pay flat rates on most types of personal income.

2. How does residency affect personal income tax in Singapore?
 Residency will decide the tax rates and the reliefs a person can claim. Residents will get deductions and rebates on the taxable income while non-residents will mostly not qualify for them.  

3. What kinds of income are subject to personal income tax in Singapore?
 Income taxed will include salary, bonuses, profits from a business, rental income, and returns from investments. Overseas income will be taxed if it is received in Singapore.  

4. When must personal income tax be filed in Singapore?
 A return will be needed if total income or self-employment profit goes above the thresholds of IRAS. Non-residents earning Singapore income or anyone receiving a notice from IRAS will also file.  

5. What happens if personal income tax is not filed on time in Singapore?
 Late filing or payment will cause penalties and interest on the unpaid tax. Repeated delays may lead to legal action while filing on time will keep a clear record with IRAS.