Do I have to pay tax

Scenario 1

You receive Director’s remuneration (excluding gains from stock option/other share ownership plans (ESOP/ESOW) in your capacity as a non-resident director of a company incorporated in Singapore

Your employer's obligations:

• Withhold tax at 20% of director’s remuneration;
• File Form IR37 and
• pay the withholding tax by the 15th of the following month from the date of payment to you

A Confirmation of Payment letter will be issued to your employer within 14 days from the receipt of the Form IR37 and tax payment.

It does not matter where the board meeting was held or that you were not physically working in Singapore. Such payments are taxable regardless of your physical presence in Singapore.

Do I need to file any tax return?

• You do not need to file any tax return as your employer has withheld tax at source and filed IR37.
• If you have received a tax return / tax bill and are in receipt of director’s remuneration only, please contact us to review the tax return / tax bill sent and forward Confirmation of Payment letter on the tax remitted.
  
  
  

How to contact us

1. Call 1800-356 8300 (or +65-356 8300 if you are overseas) or
   Our office hours are from 8am to 5pm (GMT+8) from Monday to Friday and 8am to 1pm on Saturday
2. Email us or 
3. Fax to us at +65-6351 2707 or
4. Write to:
   The Comptroller of Income Tax
   Inland Revenue Authority of Singapore
   55 Newton Road
   Revenue House
   Singapore 307987

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Scenario 2

You receive gains from ESOP/ESOW in your capacity as a non resident director of a company incorporated in Singapore

• Your employer must file the Form IR21A to report the gains from ESOP/ESOW within 30 days from the date of exercise, assignment, release or acquisition of the shares.
• You will receive a tax bill informing you of the amount of tax to pay.

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Scenario 3

You receive Director’s remuneration in your capacity as a non resident director and employment income as an executive director of a company incorporated in Singapore

Example 1 – Physical presence in Singapore is less than 183 days in a calendar year

You were appointed as an executive and board director of a Singapore incorporated company on 1 Jan 2010 . Your remuneration is as follows:

Your employer's obligations:

• withhold and remit tax of $2,000 ($10,000 @ 20%) together with the Form IR37 by 15 July 2010 as your physical presence in Singapore is less than 183 days from 1 Jan 2010 to 1 Jun 2010
• withhold and remit tax of $3,000 ($15,000 @ 20%) together with the Form IR37 by 15 Jan 2011 as your physical presence in Singapore is less than 183 days from 1 Jan 2010 to 31 Dec 2010
• Prepare Form IR8A and give you a copy by 1 March 2011 for your tax filing. For e-submission of IR8A, the ‘S45 indicator’ on the IR8A screen must be checked if tax has been withheld on the  Director’s remuneration/fees
• seek tax clearance to settle your income tax when you decide to cease employment

A Confirmation of Payment letter will be issued to your employer within 14 days from the receipt of the Form IR37 and tax payment.

Your (employee's) obligations:

• declare your employment income in the tax return for the Year of Assessment 2011 as follows:
• Salary   $60,000 ($5,000 x 12 months)
• Pay your tax upon receipt of the tax bill
• Ensure there is no outstanding tax when you decide to cease employment with your employer

You do not need to report your Director’s remuneration/fees received as a Board Director as the payer must account for the withholding tax on the payment made to you as a non-resident.

Example 2 – Physical presence in Singapore is at least 183 days in a calendar year

Your employer's obligations :

• withhold and remit tax at $2,000 ($10,000 @ 20%) together with the Form IR37 by 15 July 2010 as your physical presence in Singapore is less than 183 days from 1 Jan 2010 to 1 Jun 2010
• Prepare Form IR8A and give you a copy by 1 March 2011 for your tax filing. For e-submission of IR8A, the ‘S45 indicator’ on the IR8A screen must be checked if tax has been withheld on the Director’s remuneration/fees.
• seek tax clearance to settle your income tax when you decide to cease employment

A Confirmation of Payment letter will be issued to your employer within 14 days from the receipt of the Form IR37 and tax payment.

Withholding tax is not applicable for the Director’s fees of $15,000 as your physical presence from 1 Jan 2010 to 31 Dec 2010 is more than 183 days

Your (employee's) obligations:

• declare your employment income in the tax return for the Year of Assessment 2011 as follows:

  Salary	$60,000 ($5,000 x 12 months)
  Director's fee	$25,000

• enter the amount of withholding tax $2,000 in the field "Tax deducted at source"
• furnish a schedule of physical presence to show that you were physically present in Singapore for at least 183 days in the calendar year 2010
• Pay your tax upon receipt of the tax bill
• Ensure there is no outstanding tax when you decide to cease employment with your employer
  
  
  
  

  How to get the tax return

  If you have not received the tax return by 15 Mar, you can:

  1. Call 1800-356 8300 (or +65-356 8300 if you are overseas) or
     Our office hours are from 8am to 5pm (GMT+8) from Monday to Friday and 8am to 1pm on Saturday
  2. Email us or 
  3. Fax to us at +65-6351 2707 or
  4. Write to:
     The Comptroller of Income Tax
     Inland Revenue Authority of Singapore
     55 Newton Road
     Revenue House
     Singapore 307987

  
  

   

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