Singapore to Impose New Individual Income Tax Rates in 2017
Singapore’s Inland Revenue Authority has announced that, beginning in 2017, there will be new income tax rates for both resident and non-resident individuals in the country. Many of those affected will see their tax rates increase.
An individual will be considered a tax resident of Singapore for a particular Year of Assessment (YA) if they meet one of the following criteria:
- Is a Singapore Citizen who normally resides in Singapore except for temporary absences; or
- Is a Singapore Permanent Resident (SPR) who has established a permanent home in Singapore; or
- Is a foreigner who has stayed/worked in Singapore (excludes director of a company) for 183 days or more in the previous year.
If the individual does not meet any of the above criteria, then they will be classified as a non-resident of Singapore for tax purposes.
RELATED: Dezan Shira Associates Tax and Compliance Services
Singapore’s income tax is set at progressive rates, with higher earning individuals paying more tax. According to the IRAS, the new YA 2017 tax rates for residents will be as follows:
In YA 2017, Singapore will also change the tax rates for non-resident individuals (except certain reduced final withholding tax rates) to 22 percent. The government has stated that their intention is to “maintain parity between the tax rates of non-resident individuals and the top marginal tax rate of resident individuals, which is also being raised by two percent at the same time.”
RELATED: Indonesia’s Economy Struggles to find its Footing
In particular, the new rates will impact the following non-residents:
- Non-resident directors will see their tax rates raised from 20 percent to 22 percent
- Professionals will be subject to a rate of either 15 percent of gross income or 22 percent of net income (over the previous 20 percent)
- Non-resident public entertainers are subject to a 10 percent rate
According to the IRAS, the new rates for non-residents will be as follows:
In order to accurately assess your tax burden is it important to consult with a tax expert who is well versed in the intricacies of Southeast Asia tax requirements.
Asia Briefing Ltd. is a subsidiary of Dezan Shira Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email [email protected] or visit www.dezshira.com.
Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.
The first edition of Tax, Accounting, and Audit in Vietnam, published in 2014, offers a comprehensive overview of the major taxes foreign investors are likely to encounter when establishing or operating a business in Vietnam, as well as other tax-relevant obligations. This concise, detailed, yet pragmatic guide is ideal for CFOs, compliance officers and heads of accounting who need to be able to navigate the complex tax and accounting landscape in Vietnam in order to effectively manage and strategically plan their Vietnam operations.
In this issue of Asia Briefing Magazine, we take a look at the various types of trade and tax treaties that exist between Asian nations. These include bilateral investment treaties, double tax treaties and free trade agreements all of which directly affect businesses operating in Asia.
In this issue, we compare and contrast the most relevant tax laws applicable for businesses with a presence in Asia. We analyze the different tax rates of 13 jurisdictions in the region, including India, China, Hong Kong, and the 10 member states of ASEAN. We also take a look at some of the most important compliance issues that businesses should be aware of, and conclude by discussing some of the most important tax and finance concerns companies will face when entering Asia.