Overview of Withholding Tax

Under Singapore law, a person (known as the Payer) who makes payment(s) of a specified nature (e.g. Royalty, Interest, Technical Service Fee, etc.) to a non-resident company or individual (known as Payee) is required to withhold a percentage of that payment and pay the amount withheld(called 'Withholding Tax') to IRAS.

• Payments for Services, Interest, Royalty, Rental of Movable Properties, etc. 
• Payments to Non-Resident Directors, Professionals, Public Entertainers & International Market Agents
• Foreigners/PRs Withdrawing from Supplementary Retirement Scheme (SRS) Account
• Distribution of Real Estate Investment Trust (REITs)

To determine whether withholding tax is applicable, the Payer has to ascertain that the payment was made to a company or an individual who is Non-Resident in Singapore.

1. Non-Resident Company
   

   A company is either a tax resident or a non-resident of Singapore. In Singapore, the tax residency of a company is determined by the place in which the business is controlled and managed.

   “Control and management” is the making of decisions on strategic matters, such as those on company policy and strategy. Where the control and management of a company is exercised is a question of fact. Typically, the location of the company’s Board of Directors meetings, during which strategic decisions are made, is a key factor in determining where the control and management is exercised.

   Conversely, a company is a non-resident when the control and management of the company is not exercised in Singapore.

   Do note that the place of incorporation of a company is not necessarily indicative of the tax residence of a company.

   For more details, you may refer to Tax Residence Status of a Company

2. Non-Resident Individuals
   
   a.  Foreign Professional (Non-Resident Professional)
   Foreign professionals are individuals exercising any profession (i.e. persons other than employees) of an independent nature under a contract for service.
    
   For more details, you may refer to Foreign Professionals
   
   b.  Non-Resident Public Entertainer

   A public entertainer performing in Singapore can be exercising a profession, vocation or employment.

   For more details, you may refer to Non-Resident Public Entertainers

   c. Foreign Board Director (Non-Resident Director)

   For tax purposes, a board director is a member of the board of directors of a company.

   For more details, you may refer to Foreign Board Director

Depending on the nature of payment, the withholding tax rate will vary.  For more details on the withholding tax rates, you may refer to Types of Payment and the Applicable Withholding Tax Rates

This calculator is designed to help payers determine whether Withholding Tax is applicable when making payment to a non-resident.

Please download the relevant tax calculator as follow:  

• Payment made to a non-resident individual (ZIP, 265KB)

• Payment made to a non-resident company (ZIP, 363KB) 

If you are unable to use the macro-enabled calculators due to the macros in the file, please follow the steps below :

a.  Open the macro file and go to the “File” tab

b.  Select “Options” > “Customize Ribbon”

c.  Under the “Main Tabs” column on the right, check on the box “Developer” and click “OK” 

d.  Go to the “Developer” tab and select “Macro Security”

e.  Check the button “Enable all macros” and click “OK”

f.   Save and close the file

g.  Reopen the file

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