Social security contributions
Central Provident Fund (CPF)
The CPF is Singapore's national pension scheme. Contributions are payable by Singapore citizens and Singapore Permanent Residents (i.e. SPR obtained via immigration rules) only. Employers and employees contribute 17% and 20%, respectively, of ordinary monthly wages, up to an income ceiling of SGD 6,000. Their respective maximum contributions are therefore SGD 1,020 and SGD 1,200 per month. The rates are applicable to Singaporeans and SPRs (from third year and onwards) aged 55 years and below.
These rates also apply to additional wages (e.g. year-end bonus), up to a maximum contribution of:
- the actual additional wages if the annual ordinary wages are not more than the ordinary wage ceiling of SGD 72,000 and the total wages are not more than the maximum contribution of SGD 102,000
- the difference between the maximum contribution of SGD 102,000 and annual ordinary wages if the total wages exceed the maximum contribution of SGD 102,000 but the annual ordinary wages are not more than the ordinary wage ceiling of SGD 72,000, or
- the lower of the difference between the maximum contribution and the ordinary wage ceiling (SGD 102,000 - SGD 72,000) or the actual additional wages if annual ordinary wages exceed the ordinary wage ceiling of SGD 72,000.
Reduced rates apply for employees who are earning less than SGD 750 per month, as well as for those above 55 years of age, although these rates are being gradually increased.
The income ceiling will be increased in four stages by 2026 – to SGD 6,300 from 1 September 2023, SGD 6,800 from 1 January 2024, SGD 7,400 from 1 January 2025 and SGD 8,000 from 1 January 2026. The annual ordinary wage ceiling and maximum monthly contributions for employers and employees will be increased accordingly, however the annual salary (comprising ordinary wages and additional wages) ceiling remains at SGD 102,000.
Foreign nationals and their employers are precluded from making CPF contributions. Foreign employees who become Singapore permanent residents, and their employers, may contribute at reduced rates for the first two years.
Supplementary Retirement Scheme (SRS)
The SRS is a voluntary scheme to encourage employees and the self-employed to save for retirement over and above their CPF savings. The maximum amount to be contributed is subject to an income cap of SGD 102,000. Employers are allowed to contribute to their employees’ SRS accounts, subject to the contribution limits below. Employees will be taxable on these employer contributions, but will be allowed corresponding tax relief.
The contribution rate caps for contributions made to the SRS scheme are as follows.
|Residency status||Rate cap (%)||Contribution cap (SGD)|
|Singapore citizens or permanent residents||15||15,300|
Capital gains taxes
There is no capital gains tax in Singapore. Where an individual enters into a series of capital transactions, however, the tax authorities may take the view that the individual is carrying on a business and assess that person to income tax accordingly.
Goods and services tax (GST)
Supplies made in Singapore and importation of goods
GST is charged at 8% on the supply of goods and services made in Singapore by a taxable person in the course or furtherance of one's business and on the importation of goods into Singapore. It was announced in the 2022 Budget that this rate would be increased to 9% on 1 January 2024.
The only exemptions from GST are prescribed financial services, the sale or rental of residential properties, the sale of digital payment tokens, and the import and local supply of investment precious metals. Zero-rating only applies to the export of goods and international services (subject to conditions).
Import reliefs (e.g. Major Exporter Scheme, Approved Contract Manufacturer and Trader Scheme) are available to ease the cash-flow burden of GST registered businesses.
GST registration is required if a business makes taxable supplies in excess of SGD 1 million for a 12-month period. Voluntary registration is permitted if the taxable supplies is below the registration threshold, subject to conditions. A business may claim input tax credits on its purchases and expenses after its GST registration subject to satisfying the prescribed input tax conditions.
Overseas Vendor Registration regime
The Overseas Vendor Registration regime brings to tax business-to-consumer (B2C) supplies of remote services (i.e. digital services and non-digital services) and imported low value goods. There are specific definitions for remote services and imported low value goods.
Under the Overseas Vendor Registration regime, suppliers belonging outside Singapore are required to register, charge and account for GST on supplies of remote services and imported low value goods supplied to non-GST registered customers in Singapore. Under certain conditions, local and overseas operators of electronic marketplaces may also be regarded as the supplier of the supplies made by the overseas suppliers through these marketplaces.
Overseas suppliers which supply imported low value goods and remote services to Singapore non-GST registered customers in excess of SGD 100,000 in a 12-month period and have a global annual turnover of at least SGD 1 million are required to register for GST in Singapore.
Reverse charge applies to local businesses that are subject to input tax restriction due to the making of certain exempt supplies or carrying on of non-business activities. If these businesses are registered for GST, they are required to self-account for GST on their purchases of in-scope imported services procured from overseas service providers and on their purchases of imported low value goods. These businesses may, in turn, claim the GST accounted for as their input tax, subject to the normal rules for input tax recovery.
If these businesses are not registered for GST, they would be liable for GST registration under the reverse charge rules if their purchase of in-scope services and imported low value goods exceeds SGD 1 million in a 12-month period.
Net wealth/worth taxes
There are no net wealth or net worth taxes in Singapore.
Inheritance, estate, and gift taxes
Estate duty has been abolished for deaths occurring on or after 15 February 2008.
Property tax is levied annually on the value of houses, land, buildings, or tenements.
For residential properties, owner-occupier tax rates range from 0% to 23% (0% to 32% from 1 January 2024) and non-owner occupier tax rates range from 11% to 27% (12% to 36% from 1 January 2024). The tax rates depend on the annual value bands.
For non-residential properties, such as commercial and industrial buildings and land, the tax rate is 10%.
Excise duties are imposed on intoxicating liquors, tobacco products, motor vehicles, and petroleum products. Duties are also imposed on gambling and other games of chance.
Other non-income taxes
Stamp duties are levied on written documents (as well as electronic instruments executed on or after 4 October 2018) relating to immovable properties, leases, and stocks and shares.
Stamp duties are typically payable by the buyer (i.e. buyer’s stamp duty or BSD); however, seller's stamp duty (SSD) and additional buyer's stamp duty (ABSD) have been introduced as measures to cool the residential property market.
There is BSD of up to 6% for residential property and up to 5% for non-residential property on the purchase price or market value, whichever is the higher. There is an ABSD of up to 65% and an SSD of up to 15% on the price or market value of the property, whichever is the higher, depending on the type of property (residential or industrial), the residency status of the buyer, the holding period of the property, and the number of properties owned.
Foreigners of certain nationalities who fall within the scope of the respective free trade agreements will be accorded the same treatment as Singaporeans.
Certain transfers of equity interest in property-holding entities (PHEs) that own (directly or indirectly) primarily Singapore residential properties could attract additional conveyance duties (ACD) for buyers (up to 71%) and sellers (at 12%) who are significant owners (as defined) of PHEs, as well as for a buyer who would become a significant owner after acquiring an equity interest in the PHEs. For acquisition of equity interest in a company, share duty remains payable in addition to the ACD.
ABSD and ACD are also levied on transfers of any residential property and equity interest in PHE (where the significant ownership threshold is met) into living trusts where there is no identifiable owner of the property or equity interest at the time of transfer. Renunciation of interest in residential properties held in trust in certain scenarios will also attract applicable duties.
Leases attract duty at 0.4% of the total rent (for leases of up to four years) or 0.4% of four times the average annual rent for the period of the lease (for leases longer than four years), but leases with average annual rents not exceeding SGD 1,000 are exempt from stamp duty.
Stocks and shares
Instruments effecting the transfer of stocks and shares are subject to stamp duty of 0.2% on the purchase price or market value of the shares transferred, whichever is the higher.
Local non-income taxes
Foreign Worker Levy (FWL)
The FWL is a monthly levy that employers are liable to pay for each foreign employee (Work Permit or S Pass holders) hired. The levy rate depends on the employer’s industry and the ratio of foreigners to Singaporeans and permanent residents employed in the company.
Skills Development Levy (SDL)
Employers are required to contribute a levy for each employee at 0.25% of the monthly total wages. The minimum payable is SGD 2 for an employee earning less than SGD 800 a month and the maximum is SGD 11.25 for an employee earning more than SGD 4,500 per month.
The SDL is channelled to the Skills Development Fund (SDF), which is used to support workforce upgrading programmes and to provide training grants to employees sent for training under the National Continuing Education Training system.
The SDL and SDF are administered by the Skills Future Singapore Agency with the CPF Board as the collecting agent.