According to Singapore's Ministry of Manpower, Singapore does not have minimum wage and "salary is subject to negotiation and mutual agreement between an employer and an employee or the trade union representing the employees" but if your business is growing beyond a one-man show, here are some things you need to know for successful payroll management regarding Singapore's Payroll Statutory:
Inland Revenue Authority of Singapore (IRAS)
- Individuals are to submit their personal income tax filing by April 15th of the following year. Online submission via myTax Portal is preferred.
- Employers are to prepare and give the IR8A forms to all employees by 1st March. This form contains all the previous year’s income information.
- For larger employers with 7 employees or more, they must also upload the IR8A form details to IRAS portal by 1st March. This is known as the Auto Inclusion Scheme (AIS). Eventual plan is for all employers to be included in AIS.
- With AIS, individuals just need to verify the details and add other information where necessary, e.g. non employment income such as trade income, dividends, interests etc.
- Most payroll software will be able to generate the necessary AIS file to upload to IRAS.
- There is no need to withhold any income tax from local Singaporean and Permanent Resident employees. Its the responsibility of the individual to submit and pay the income tax.
- For foreigners on Employment Pass leaving the country, employers have to obtain tax clearance by completing form IR21 online. And it is the responsibility of the employer to ensure that the final income tax is paid by the employee. Failing which, they will be liable for the tax.
- For myTax Portal, go to : https://mytax.iras.gov.sg/ESVWeb/default.aspx
- For AIS, go to : https://www.iras.gov.sg/irashome/Businesses/Employers/Auto-Inclusion-Scheme--AIS--for-Employment-Income/
- For IR21, go to : https://www.iras.gov.sg/IRASHome/Businesses/Employers/Tax-Clearance-for-Foreign---SPR-Employees--IR21-/
Central Provident Fund (CPF)
- All Singaporeans and Permanent Residents employees are subject to CPF. Exception are Interns from approved education institutes.
- Contribution rates various according to age and nationality. Average rate is 20% for employer and 17% for employee.
- Contribution is capped at monthly salary level of $6000 (Ordinary wages) and $30000 of bonuses, commissions etc (Additional Wages)
- Employers are to submit the CPF details online (via e-Submission on the CPF Employer Portal) latest by the 14th day of the following month.
- Payments will be effected on the 15th of the month. Preferred payment method is GIRO or Direct Debit.
- For more info, go to : https://www.cpf.gov.sg/Employers
CorpPass - This is the digital online system to transact all government related transactions/services.
- There are 3 types of users:
- Company Administrator: Creates and maintain users for the company
- User: Company staff authorised to transact on company’s behalf
- Third Party: External parties authorised to transact on company’s behalf. E.g. tax agents, payroll service providers, corporate secretarial firms, customs agents etc.
Companies need to apply and register for CorpPass, its not granted by default.
For more info, go to :
https://www.corppass.gov.sg/cpauth/login/homepage?TAM_OP=login
