Under the Area Representative Scheme, if you work for a foreign employer and operate from a base in Singapore to discharge your regional functions and duties, you may enjoy time apportionment of employment income, subject to qualifying conditions.
If you qualify to be assessed as an Area Representative, you will be taxed on the amount of your remuneration attributable to the number of days spent in Singapore. However, benefits-in-kind (BIK) provided in Singapore are fully taxable.
What are the qualifying conditions?
To qualify as an Area Representative, you must satisfy these four criteria below:
- You must be employed by a non-resident employer;
- You are based in Singapore for geographical convenience;
- You are required to travel outside of Singapore in the course of your duties; and
- Your remuneration is paid by your foreign employer and not charged directly or indirectly to the accounts of a permanent establishment in Singapore.
(Note : A permanent establishment refers to a fixed place where a business is wholly or partly carried on, e.g. a place of management, a branch, an office, a factory etc.)
Time apportionment of income
Your employment income will be prorated based on the duration of your physical presence in Singapore during the calendar year:
Number of days of presence in Singapore X Employment Income
Total number of days in the basis period
If you are present in Singapore for any part of a day, your presence on that day will be counted as one day in Singapore.
Depending on the total number of days attributable to work in Singapore, you may be treated either as a tax resident or a non-resident:
|If the total number of days attributable to work in Singapore in a calendar year is 60 days or less
||Your short-term employment income is exempt from tax. This rule does not apply if your stay covers three continuous years or more.
|If the total number of days attributable to work in Singapore in a calendar year is 61 - 182 days
||Your apportioned income will be taxed at 15% or resident rates, whichever results in a higher tax.
|If the total number of days attributable to work in Singapore in a calendar year is 183 days or more
||Your apportioned income will be taxed at resident rates.
|If your stay covers three continuous years or more
||Resident for all years
||Your apportioned income will be taxed at resident rates for all years.
How to apply for Area Representative status and concession?
Submit the following documents to IRAS together with your annual tax return by 15 Apr of the Year of Assessment in which you qualify for the scheme:-
If your Area Representative status is approved and you are employed by the same employer, you need not apply for the status every year. However, to enjoy the tax concession under the scheme, you are required to submit the Area Representative Travel Calculator (40KB) by 15 Apr each year.
See If you are employed by a foreign employer for more information.