| Nature of Income | Tax Rate |
|---|
| Payment to Non-Resident Director | 22% (20% prior to Year 2016) |
| Payment to Non-Resident Professional/Foreign Firms (Unincorporated) | 15% on gross income or prevailing non-resident individual rate on net income |
| Payment to Non-Resident Public Entertainer | 10% on gross income (till 31 Mar 2022) |
| Commission/Payment to Non-Resident International Market Agent | 3% |
1These withholding tax
rates apply when the income is derived by the non-resident person through
operations carried on outside Singapore. They are to be applied on the gross
payment. The resulting tax payable is a final tax. The following tax rates
apply on gross payments when operations are carried out in Singapore:
Non-resident person (other than
individuals): Prevailing Corporate Tax Rate
Non-resident individuals: 22% (20% for period of engagement prior to 1 Jan 2016). This does not apply to scenario in footnote 2.
2The reduced withholding
tax rate of 10% applies to payments due and payable on or after 1 Jan 2015. However, this does not apply to the royalty payment for an author, a composer or a choreographer.
- Royalty payment for an author, a composer or a choreographer
The prevailing tax rate of 22% shall apply to the deemed income (i.e net income or 10% of the gross royalties, whichever is lower). For details, please refer to Tax Concession for Royalty
3For non-resident company, withholding tax is based on
the prevailing corporate tax rate for the year when the services were provided (period of payment), even if payment to the
non-resident is made in a different year. For example, if the service was
provided in Dec 2018 but payment was made in 2019, the prevailing
corporate corporate tax is that for 2018 (Year of Assessment 2019), which is 17%.
4 The reduced withholding
tax rate of 10% applies to distributions made during the period from 18 Feb
2005 to 31 Mar 2020 [Section 43(3B) of the Income Tax Act]. Withholding tax does not apply to any distribution made by a REIT where tax has already been paid, on the income from which the distribution
is made, by the trustee of the trust [Section 45G(4) of the Income Tax Act].
In
Budget 2019, to continue to promote the listing of REITs in Singapore and
strengthen Singapore’s position as a REITs hub in Asia, the Minister for
Finance extended the reduced withholding tax rate of 10% on distributions made
by a REIT to qualifying non-resident non-individual unit holders during the
period from 1 Apr 2020 to 31 Dec 2025.
A qualifying non-resident non-individual unit holder is one who:
(a)
does not have any permanent establishment (“PE”) in Singapore; or
(b) carries on any operation
in Singapore through a PE in Singapore, where the funds used by that unit
holder to acquire the units in that REIT are not obtained from that operation.
If tax has been deducted in error at the prevailing corporate tax rate from the distributions made to nominees whose beneficiaries are any of the persons listed below, the Comptroller will refund the tax over-deducted to the trustee of REIT directly on a quarterly basis. The beneficiaries^ may be any of the following:
- qualifying individual;
- qualifying non-resident non-individual;
- charity registered under the Charities Act (Cap. 37) or established by any written law;
- town council;
- statutory board;
- co-operative society registered under the Co-operative Societies Act (Cap. 62); or
- trade union registered under the Trade Unions Act (Cap. 333).
^ Do not include a person acting in the capacity of a trustee.
The trustee,in turn will refund the amount to the nominees who will then refund it to the beneficiaries. For this purpose, the trustee is required to send its request for refund with all the original subsidiary income tax certificates on a consolidated basis. Please send your request to:
Revenue & Payment Management Branch
Inland Revenue Authority of Singapore
55 Newton Road
Revenue House
Singapore 307987
5 Tax refund under S46 of ITA for payments withheld at prevailing corporate tax rate