At Taxes for Expats we have been preparing U.S. tax returns for U.S. Citizens and permanent residents living in Singapore for over 10 years. As a U.S. Citizen or green card holder you are legally required to file a U.S. tax return each year regardless of whether you already pay taxes in your residence country. The expatriate Foreign Earned Income Exclusion ($92,900 for 2011 and $95,100 for 2012) only can be claimed if you file your tax return on a timely basis. It is not automatic if you fail to file.
We have many clients living in Singapore and know how to integrate your U.S. taxes into the local income taxes you pay. Any income tax you pay there can be claimed as against the tax liability on your U.S. return on the same income.
As an expat living abroad you get an automatic extension to file until June 15th following the calendar year end. (You cannot file using the calendar year as is standard in Singapore for U.S. tax purposes). You must, however, pay any tax that may be due by April 15th in order to avoid penalties and interest. You can get an extension to file (if you request it) until October 15th.
There are other forms which must be filed if you have foreign bank or financial accounts; foreign investment company; or own 10% or more of a foreign corporation or foreign partnership. If you do not file these form or file them late the IRS can impose penalties of $10,000 or more per form. These penalties are due regardless of whether you owe income taxes or not.
We have helped hundreds of expats around the world catch up with their past U.S. taxes because they have failed to file U.S. tax returns for many years. This is, in fact, our specialty and we offer a 10% discount to clients to wish to file multiple tax returns at once and get in full compliance with the IRS.
Unfortunately, unlike Australia, Canada, U.K., etc. you must also file your taxes on worldwide income so long as you are a U.S. citizen or green card holder. You always have the option to give up your U.S. citizenship - by following proper IRS and State Department procedures you can surrender your U.S. Citizenship and therefore cut off your obligation to file U.S. taxes in the future. You must surrender the Citizenship for non-tax avoidance reasons and then can usually only return to the U.S. for no more than 30 days per year for the subsequent ten years. This is another service that we have provided many clients in the past.
Work with a recognized expert to help you prepare your American tax return. We can also provide tax planning and advice with other expatriate tax and legal concerns; we look forward to working with you.
Below we include information on the Singapore Tax System for American expatriates.
Singapore's Personal Income Tax structure is one of the friendliest and most competitive in the world. The tax year is from 1 January to 31 December in each calendar year and income is assessed on a preceding year basis.
Key points of Singapore income tax for individuals include:
- The amount of income tax that you have to pay depends on your tax residency in Singapore. The taxes for residents are different from non-residents.
- Singapore follows a progressive tax rate starting at 0% and ending at 20% above S$320,000.
- There is no capital gain or inheritance tax.
- Non-residents are taxed at the flat rate of 15% or the resident rates whichever results in a higher tax amount.
- Besides salaries and bonuses, perquisites such as housing and stock options will form part of your taxable employment income.
- Individuals are taxed only on the income earned in Singapore. The income earned by individuals while working overseas is not subject to taxation barring few exceptions.
- Tax rules differ based on the tax residency of the individual.
- Tax filing due date for individuals is April 15 of each year. Income tax is assessed based on a preceding year basis.
- If you are an Resident/Employment pass/PEP/Entrepass holder,
- If your annual income in Singapore in 2010 is above S$22,000,
- If you have received a letter from Inland Revenue Authority of Singapore inviting you to file personal income tax. This is regardless of the amount of your annual income for the previous year.
Companies must give completed Forms IR8A to employees, showing remuneration and benefits in- kind for the previous calendar year, by 1 March.
Personal Tax Filing Due Date:
It is mandatory under law to file for the annual personal tax return to IRAS by 15 April 2011. IRAS diligently enforces the requirements relating to the filing of the personal tax. Please comply to avoid paying fines and/or court prosecution.
Income is assessed on a preceding calendar year basis, ending 31 December. You must File Your Annual Tax Form by 15 April of the following year. If tax return is not filed by the 15 April deadline, IRAS may raise estimated assessment. You can usually expect to receive the income tax bills from May to August.
Dividend income from Singapore companies, interest income from savings, current or fixed deposit accounts with approved banks or finance companies in Singapore and foreign-sourced income are tax-exempt for individuals (regardless of residency).
Filing status - Each individual is required to file a separate tax return, including married couples living together.
Taxable income - Income includes gains or profits from a trade or profession and earnings from employment (including the value of employer-provided food, clothing or housing and allowances other than for subsistence, transport, travel or entertainment).
Capital gains - Singapore does not tax capital gains.
Tax Deductions and allowances - Personal reliefs and tax rebates are granted only to resident individuals. Personal reliefs may be deducted against assessable income to ascertain chargeable income on which tax is then computed. Tax rebates are deducted from the tax payable to determine the final tax liability of the individual.
Real property tax - Property tax, levied on all immovable property in Singapore, is payable annually by the owner at the beginning of the year. Immovable property includes Housing Development Board flats, houses, offices, factories, shops and land. The annual property tax is calculated based on a percentage of the gross annual value of the property as determined by the property tax department. The property tax is 4% for owner-occupied residential property and 10% for other property. A property tax exemption for land under certain development may be granted for certain cases.
Comparison of Income Tax Rates
US Income Brackets and Tax Rates
| Marginal Tax Rate | Single | Married Filing Jointly or Qualified Widow(er) | Married Filing Separately | Head of Household |
| 10% | $0 - $8,375 | $0 - $16,750 | $0 - $8,375 | $0 - $11,950 |
| 15% | $8,376 - $34,000 | $16,751 - $68,000 | $8,376 - $34,000 | $11,951 - $45,550 |
| 25% | $34,001 - $82,400 | $68,001 - $137,300 | $34,001 - $68,650 | $45,551 - $117,650 |
| 28% | $82,401 - $171,850 | $137,301 - $209,250 | $68,651 - $104,625 | $117,651 - $190,550 |
| 33% | $171,851 - $373,650 | $209,251 - $373,650 | $104,626 - $186,825 | $190,551 - $373,650 |
| 35% | $373,651+ | $373,651+ | $186,826+ | $373,651+ |
Singapore Personal Income Tax Rates for resident individuals:
Tax rates for resident individuals
| Year of Assessment 2011 and before | Year of Assessment 2012 NEW* | ||
| Band ($) | Rate (%) | Band ($) | Rate (%) |
| 0 - 20,000 | 0.0 | 0 - 20,000 | 0.0 |
| 20,001 - 30,000 | 3.5 | 20,001 - 30,000 | 2.0 |
| 30,001 - 40,000 | 5.5 | 30,001 - 40,000 | 3.5 |
| 40,001 - 80,000 | 8.5 | 40,001 - 80,000 | 7.0 |
| 80,001 - 160,000 | 14.0 | 80,001 - 120,000 | 11.5 |
| 120,001 - 160,000 | 15.0 | ||
| 160,001 - 320,000 | 17.0 | 160,001 - 200,000 | 17.0 |
| 200,001 - 320,000 | 18.0 | ||
| Above 320,000 | 20.0 | Above 320,000 | 20.0 |
Note: A one-off personal income tax reabate of 20%, capped at $2,000, will be granted for the Year of Assessment 2011.
The Inland Revenue Authority of Singapore
The Inland Revenue Authority of Singapore (IRAS) acts as an agent of the government and administers, assesses, collects and enforces payment of taxes. The IRAS also advises the government and represents Singapore internationally on matters relating to taxation.
A Singapore citizen or a Singapore Permanent Resident who returns to work to Singapore will be liable to pay income tax. You will be required to complete and submit the relevant tax form that will be mailed to you.
Your employer may furnish your salary details to IRAS directly and this portion of your income need not be included in your tax return. However, you must still submit the tax form and report other income you received in Singapore in the previous year.
Should your employer not give IRAS your salary details, you should be issued with the IR8A form, which is the form that shows the gross employment income that you have earned in the previous year. You must include the IR8A with your completed tax form. The chargeable income, that is, your income after deduction of personal reliefs, will be taxed at resident rates of between 0% and 20% from Year of Assessment 2007. The resident rates only apply to a taxpayer who is considered a tax resident, that is, he has been in Singapore for more than 183 days or can prove so by other qualitative means in the previous year.
Submitting Your Income Tax
You can submit your tax return by post or through e-filing at www.iras.gov.sg, or by phone. If you fail to submit your return by 15th April or to pay your taxes within the specified due date, you will be penalised. To avoid late payment penalties on your tax payable, you may arrange to pay your taxes by GIRO or log on to do it electronically at www.iras.gov.sg for immediate payment. Do remember to print the acknowledge copy for your own records.
For more information, please contact:
Taxpayer Services Centre
Inland Revenue Authority of Singapore
1st Storey, Revenue House,
55 Newton Road, Singapore 307987
Website: www.iras.gov.sg
IRAS Hotlines
| Tax Hotline for General Enquiries & Payment Enquiries | Tel: 1800 356 8300 |
| Business Income Tax Hotline | Tel: 1800 356 8611 |
| Corporate Income Tax Hotline | Tel: 1800 356 8622 |
| GST (Goods and Services Tax) Hotline | Tel: 1800 356 8633 |
| Property Tax Hotline | Tel: 1800 356 8600 |
| Tax Clearance Hotline | Tel: 1800 356 8655 |
| Inland Revenue Information Service (IRIS) | Tel: 1800 356 8611 |
| Fax Express Service | Tel: 1800 356 8677 |
Singapore Social Security - The Central Provident Fund
The Central Provident Fund (CPF) acts in place of a national social security. Essentially, the CPF is a mandatory savings scheme that was introduced in 1955 to help cover the cost of living for Singapore residents upon retirement / cessation of employment.
Monies saved in the Ordinary Account of the CPF can be used to help pay for home ownership, education and investment. The Special Account is meant for old age and contingency purposes and to purchase retirement-related financial products. A portion of the CPF known as Medisave can also be used to help pay for hospital treatment and for medical insurance (known as MediShield).
The CPF scheme applies to all Singaporeans and Singaporean Permanent residents; foreigners who are on a Work Pass are not required to contribute to this fund. However, when a foreigner takes up permanent residency in Singapore, the foreigner will be expected to contribute to the CPF scheme. Both the employer and the employee contribute to this fund in varying proportions.
Social security contributions - Only employees who are Singapore citizens or Singapore permanent residents are required to contribute to the CPF at a rate of 20%. Graduated rates may apply for the first 3 years when the employee first attains permanent residence.
PERSONAL TAX FOR SINGAPORE RESIDENTS
Who is a tax resident?
Different tax rates apply for tax residents and non-residents. You will be treated as a tax resident for a particular Year of Assessment (YA) if you are a:
- Singaporean; or
- Singapore Permanent Resident (SPR) if you have established your permanent home in Singapore; or
- Foreigner who stayed/worked in Singapore for 183 days or more in previous year (excludes director of a company).
For Foreigners working in Singapore, the following conditions are also applicable for the taxability of their income in Singapore:
- If you work in Singapore for 60 days or less in a calendar year, you will be exempt from tax on your earnings here.
- If you stay or work in Singapore for 61 to 182 days in a calendar year, your income will be taxed at 15% or resident rates for individuals, whichever gives the higher tax.
- If you stay or work in Singapore for 183 days or more in a calendar year, your income will be taxed at resident rates for individuals.
- If you stay or work in Singapore for a continuous period of at least 183 days over two years, your income will be taxed at resident rates for individuals.
- If you stay or work in Singapore for three consecutive years, your income for all years will be taxed at resident rates.
What is Chargeable Income?
Chargeable income (Taxable Income) is the net income after deduction of expenses, donations, and personal relief. Personal tax relief, subject to conditions, includes support of dependents, academic tuition, professional development expense and premiums paid on life insurance policies.
How is Taxable Income Computed?
The Inland Revenue Authority of Singapore [IRAS] provides the formula in determining the Taxable Income of an individual. It is the following:
- Total Income Less Expense = Statutory Income
- Statutory Income Less Donations = Assessable Income
- Assessable Income Less Personal Reliefs = Taxable Income