Late Payment Penalty

Payer must e-file and pay the withholding tax to IRAS by the 15th of the second month from the date of payment to the non-resident.

If the withholding tax payment is not received by the due date, a 5% penalty will be imposed.

Additional penalties of 1% per month may be imposed if the tax remains unpaid 30 days after the imposition of the 5% penalty. The 1% additional penalty will be imposed for each completed month that the tax remains unpaid, up to a maximum of 15% of the unpaid tax.

Late Payment Penalty Notice

Payer will be informed of the 5% penalty via a late payment penalty notice. Payment must be made before the due date stated on the late payment penalty notice to avoid further enforcement actions.

GIRO Cancellation or Termination

 If the deduction through GIRO is unsuccessful due to reasons such as insufficient funds in the bank account, or the deduction amount is higher than the limit set, etc., IRAS will cancel the GIRO plan.

A GIRO cancellation notice will be issued to inform Payer that the GIRO plan has been cancelled. A late payment penalty will be imposed if the overdue tax is not paid immediately.

Further Enforcement Actions

If the tax continues to remain unpaid, other actions to recover the taxes may include:

  • Appointing agents like your bank, employer, tenant or lawyer to pay the moneys to IRAS; and/or
  • Issuing a travel restriction order (TRO) to stop you (applicable to sole-proprietors and/or partners) from leaving Singapore; and /or
  • Taking legal action

Payers will experience inconveniences in using their bank account should their bank be appointed as an agent to recover tax. In some instances, they may not be able to access their bank accounts until the full payment for tax has been received.

In addition to the recovery actions, IRAS may concurrently impose an additional 1% penalty on the overdue tax for each completed month that the tax remains unpaid, up to maximum of 15% of the tax overdue.

Releasing Appointed Agents

Agents will only be released from the appointment after the tax and penalties have been paid, or when payment has been arranged with IRAS.  

Note:
For banks appointed as agents, requests for release cannot be processed on Saturdays, Sundays and Public Holidays. Any request for release of bank after 12pm on weekdays can only be processed on the next working day.

Travel Restrictions

If a Travel Restriction Order (TRO) is issued (applicable to sole proprietors and/or partners), you will not be allowed to travel out of Singapore until you pay the tax in full.

The Notification for Release of TRO will be available at https://mytax.iras.gov.sg two working days after your payment has been received and can be retrieved to facilitate your travel at the immigration checkpoints when you leave Singapore. We will also mail the certificate to you within ten days.

For non-NRIC holders, please note that it is your responsibility to ensure that you have a valid pass to remain in Singapore. Please approach the Immigration & Checkpoints Authority (ICA) to extend your stay in Singapore if you require more time to resolve your tax matters with IRAS. It is an offence to overstay in Singapore without a valid pass.

Making Payment

Please refer to Withholding Tax for the various modes of payment available. 

Appeal for Late Payment Penalty Waiver

Generally, penalties will not be waived unless there are exceptional circumstances.

IRAS may consider your appeal for a waiver of the late payment penalty if :

  1. This is your first appeal or you have filed and paid on time in the last two years; and
  2. You have paid the overdue tax in full; and
  3. You undertake to pay your tax by the due date in future. This includes taking measures to ensure that late payment will not happen again, such as signing up for GIRO.

All applications for waiver of late payment penalty are to be submitted online via Request for S45 Withholding Tax Penalty Waiver

We will process your request within 15 working days.

  • How is the 5% and 1% additional late payment penalty computed?

    Example 1 : Calculation of 5% Late Payment Penalty

    Payer X made royalty payment of $10,000 (Gross) to Non-resident A on 02 May 2019. 7 Apr 2021. However, As Payer X did not make the withholding tax payment of $1,000 was only made to IRAS on by Jul 2019 15 Jun 2021, and only did so on 28 Jun 2021. Hence, the late payment penalty is computed below.  A 5% penalty of $50 (i.e 5% of $1,000) was imposed.

    Date of Payment to Non-Resident Filing and Payment Due DateDate Payer e-Filed and Paid WHTWHT Amount5% Penalty
    7 Apr 2115 Jun 21 28 Jun 21 $ 1,000 $ 50

     

    Example 2 : 1% additional penalty

    Payer X did not make the withholding tax payment of $7,000 by the due date, and received a late payment penalty notice dated 23 Jan 2020 informing them on the unpaid tax and the 5% late payment penalty. The due date for payment of tax and penalty (i.e. $7,350) on the notice was 24 Feb 2020, but Payer X only paid up the tax and penalties on 27 Oct 2020.

    The payment was overdue by 7 months (i.e. Mar 2020 to Sep 2020) after the late payment penalty notice due date. The total penalty imposed was $840 [ (5% penalty x $7,000) + (1% additional penalty x $7,000 x 7 completed months)].

    Date of Payment to Non-Resident

    Filing and Payment Due Date

    Date Payer Paid WHT

    WHT Amount

    5% Penalty 

    Additional 1% Penalty

    28 Nov 19

     15 Jan 20

     27 Oct 20

    $ 7,000

    $ 350

    $ 490 

    ($ 7,000 x 1% x 7 completed months)