Singapore Personal Income Tax Guide: How To File and Pay Your Personal Income Tax YA 2021
Singapore Personal Income Tax Guide 2021
If you’re working in Singapore, chances are, you probably need to pay tax.
Here in Singapore, we follow a progressive personal income tax rate which starts at 0% and maxes out at 22% for employment and self-employment incomes above $320,000.
Thankfully, there is no capital gain or inheritance tax.
For 2021, the deadline for personal income tax submission will be by 18 April 2021 (Sunday).
Think that this is all too cheem (Hokkien: complex)?
Fret not!
This really simple and essential guide should help you figure out your personal income tax in no time!
Tips & Tricks for Income Tax Relief!
TL;DR: How to File Your Personal Income Tax in 2021
Paying your taxes is mandatory as it helps to fund Government spending on common resources (eg. infrastructure like roads, and security like the Singapore Armed Forces and the Singapore Police Force).
It’s pretty straightforward as you can do it online via myTax Portal or by paper filing.
To pay lesser tax, you can do so through various (legal) ways like charity contributions, NSman deductions, CPF Top-ups etc.
If you want to know exactly how much income you have to pay…
You can use the IRAS Personal Tax Calculator to find out!
Do I Need to File My Income Tax?
Before you get started on filing your income tax, it’s important to understand whether you need to file your income tax or not.
1) You Receive a Letter, Form or SMS From IRAS Telling You That You NEED to File Your Income Tax
Pretty straightforward.
This means that you’ll need to file your income tax return via myTax Portal between 1 March to 18 April 2021.
If your employer applied for the Auto-Inclusion Scheme (AIS) for Employment Income, any information about your salary will be pre-filled.
If you’re a commission agent or taxi or private-hire car driver and you and your organisation are participating in the Pre-filling of Income for Self-Employed Persons Scheme, your income information from the organisation will also be pre-filled.
But, you’ll still need to complete the other field in your tax return form before submitting it.
You can also check if your employer is participating in the AIS here.
2) You Receive a Letter or SMS From IRAS Telling You That You DO NOT Need to File Your Income Tax
If you receive a letter or an SMS telling you that you do not need to file your income tax for the year.
FYI: the SMS is sent around mid-February of each year.
SMS For Self-Employed Persons (SEPs) under the Pre-filling of Income Scheme:
<SXXXX567A>: We have implemented No-Filing Service (NFS) for selected self-employed
taxpayers for 2021. You do NOT need to file a 2021 tax return under NFS. From 1 Mar to 18 Apr,
you can verify your income and relief claims. Preview your tax bill at
https://mytax.iras.gov.sg/iras/filetax. You may request for early assessment or await your tax bill
that will be sent subsequently. Details at www.go.gov.sg/iras-sepnfs
That means that you have been selected for No-Filing Service (NFS) and do not need to file a tax return.
However, if you wish to make any adjustments (for eg. changes to income details or relief claims) you can log in to myTax Portal to file it.
The next thing you’ll need to look out for would be your Notice of Assessment (NOA) or tax bill which will be sent to you around end-April.
This will tell you how much income tax is payable.
If there are any discrepancies, you can inform IRAS through the “Object to Assessment” e-Service in myTax Portal.
3) You DO NOT Receive Anything From IRAS
This DOES NOT mean that you don’t have to file your income tax.
You will still need to file a tax return if your:
- annual net business income exceeded $6,000, OR
- annual income (inclusive of rental income) was more than $22,000 last year
Just be a good citizen and head over to myTax Portal to file your tax return.
Starting from this year, selected taxpayers on the No-Filing Service will receive a Direct Notice of Assessment (D-NOA).
This means that they will not receive a notification from IRAS during tax filing season but will receive their tax bill directly from May onwards.
The D-NOA initiative will be extended to more taxpayers progressively over the next few years.
How to File Your Income Tax in 2021
It’s really simple.
There are three components to filing your personal income tax.
1) Income
When it comes to income, there is taxable income and non-taxable income.
Here are some examples of taxable income:
- Employment Income
- Salaries
- Bonuses
- Director’s Fee
- Self-employment income from Trade, Business, Profession or Vocation
- Rental Income
- Withdrawal from SRS
Non-taxable income includes:
- Winnings from 4D, TOTO, horse betting and soccer betting.
- Capital gains from stocks and property investments
- Pensions
- CPF Life Payouts
You can also refer to this IRAS table for a full list of what’s taxable and what’s not.
2) Deductions
Deductions refer to any allowable expenses you incurred or approved donations you made during the year.
Some examples of deductions include:
- Employment expenses incurred by employees because of work (e.g. work-from-home expenses, such as electricity charges and telecommunication charges, that were not reimbursed by your employer)
- Business expenses incurred in carrying on a trade, business, profession or vocation
- Rental expenses
- Approved donations to recognised charitable organisations and institutions
3) Tax Reliefs
Usually given if you support certain government initiatives with “to promote specific social and economic objectives”.
| General Reliefs Available to ALL Taxpayers | Amount of Tax Relief | Additional Reliefs Available to Married/ Divorced/ Widowed Taxpayers | |
|---|---|---|---|
| Note: Eligibility is dependent on individual meeting the qualifying criteria | Available to Male and Female Taxpayers | Available to Female Taxpayers | |
| Course Fees Relief | Up to $5,500 | NSman (Parent) Relief Qualifying/ Handicapped Child Relief Spouse/ Handicapped Spouse Relief | NSman (Wife) Relief Foreign Domestic Worker Levy Relief Grandparent Caregiver Relief Working Mother's Child Relief |
| CPF Cash Top Up (You and your family member) | Up to $14,000 ($7,000 for self, $7,000 for family members) |
||
| CPF Relief | Depends | ||
| Earned Income Relief | Up to $8,000 | ||
| Earn Income Relief (for handicapped person) | Up to $12,000 | ||
| Handicapped Brother/Sister Relief | $5,500 for each handicapped sibling or sibling-in-law | ||
| Life Insurance Relief | The difference between $5,000 and your CPF contribution or Up to 7% of the insured value of your own/your wife's life or the amount of insurance premiums paid. |
||
| NSman Relief | Up to $5,000 | ||
| Parent Relief | Up to $9,000 per dependant | ||
| Handicapped Parent Relief | Up to $14,000 per dependant | ||
| Supplementary Retirement Scheme (SRS) Relief | $15,300 | ||
| Donation | 250% of donation value | ||
| Claim rental expenses on residential property | 15% of rental income and home loan interest | ||
Some common ones which most of you might qualify for include:
- Having children
- Staying with your parents
- Serving the country through National Service
- Topping up your CPF account (as a means of planning for your retirement)
You can also refer to this IRAS table for a full list of qualifying reliefs, expenses, donations to make sure you don’t miss out on any!
Do note that there is a limit to the amount of tax relief which you can receive.
The income tax relief ceiling is currently $80,000.
Personal Income Tax Rates for Residents 2021
Once you’ve filed your income tax.
You’ll want to see how much you’re getting taxed.
As mentioned earlier, tax residents are taxed at progressive tax rates.
Here’re the personal income tax rates for residents:
| Chargeable Income | Income Tax Rate (%) | Gross Tax Payable (S$) | Total Income Tax in this income bracket (S$) |
|---|---|---|---|
| First $20,000 Next $10,000 | 0 2 | 0 200 | 200 |
| First $30,000 Next $10,000 | - 3.50 | 200 350 | 550 |
| First $40,000 Next $40,000 | - 7 | 550 2,800 | 3,350 |
| First $80,000 Next $40,000 | - 11.50 | 3,350 4,600 | 7,950 |
| First $120,000 Next $40,000 | - 15 | 7,950 6,000 | 13,950 |
| First $160,000 Next $40,000 | - 18 | 13,950 7,200 | 21,150 |
| First $200,000 Next $40,000 | - 19 | 21,150 7,600 | 28,750 |
| First $240,000 Next $40,000 | - 19.50 | 28,750 7,800 | 36,550 |
| First $280,000 Next $40,000 | - 20 | 36,550 8,000 | 44,550 |
| First $320,000 In excess of $320,000 | - 22 | 44,550 | - |
As you can see, the more you earn, the more you’re taxed.
Which is kind of logical and pragmatic if you think about it…
It’s also worth noting that Singapore boasts one of the lowest tiered tax rates in the world for a country with a pretty high standard of living.
Personal Income Tax Rates for Non-Residents 2021
Non-residents are taxed at a flat rate of 15% or the resident rates — whichever results in a higher tax amount on your employment income
Director’s fees and other income are taxed at 22%.
Here’re the personal income tax rates for non-residents:
| Type of Income | Non-resident individual tax rate / withholding tax rate from YA 2017 |
|---|---|
| Director's remuneration | 22% |
| Income derived from activity as a non-resident professional (consultant, trainer, coach, etc.) | 15% of gross income or 22% of net income |
| Income derived from activity as a non-resident public entertainer (artiste, musician, sportsman, etc.) | 10% concessionary rate (No change) |
| Other income e.g. property rental income | 22% |
| SRS withdrawal by a non-citizen SRS member | 22% |
| Interest, royalty etc. | Reduced final withholding tax rate (subject to conditions) as follows: Interest: 15% Royalty: 10% OR 22% if reduced final withholding tax rate is not applicable. |
Note: you’re also not entitled to tax reliefs.
You can also refer to this IRAS site for tax rates for non-residents if you’d like more information.
Commonly Asked Questions About Income Tax
If this is your first time paying income tax, you probably have a lot of questions.
Here are some commonly asked ones.
Who Is Subjected to Income Tax?
Generally, income tax applies to people in Singapore who are tax residents and are deriving some form of income from:
- Employment (Salary or Bonuses)
- Trade, Business, Profession or Vocation (e.g. online sellers and service providers, gig workers, commission agents and private hire car/taxi drivers)
- Property or Investments
- Other Sources (e.g. annuities, royalties, winnings or estate or trust income)
How Do I Know If I’m A Tax Resident?
You will be treated as a tax resident for a particular YA if you are a:
- Singapore Citizen who normally resides in Singapore except for temporary absences
- Singapore Permanent Resident (SPR) who has established a permanent home in Singapore
- A foreigner who has stayed or worked in Singapore (excluding director of a company) for 183 days or more in the previous year, i.e. the year before the YA.
If you are employed overseas but now working remotely from Singapore due to COVID-19 travel restrictions, IRAS will treat you as not exercising employment in Singapore, if you meet certain conditions.
Are My Investment Dividends Taxable?
This is a very common question which we always get by members of the SeedlyCommunity.
Non-Taxable Dividends
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