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.
Foreign employers include foreign based companies with representative offices registered with Enterprise Singapore and entities not registered in Singapore. Foreign employers are considered non-resident employers for tax purposes.
Qualifying as an Area Representative
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.
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 the day, your presence on that day will be counted as one day in Singapore.
If you are on vacation leave during the calendar year, whether inside or outside of Singapore, your pro-rated employment income will be calculated as follow:
Tax Residency Status
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:
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.
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.
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.
Your stay covers three continuous years or more
Resident for all years
Your apportioned income will be taxed at resident rates for all years.
Applying for Area Representative Status and Concession
Submit the following documents to IRAS together with your annual tax return by 15 April of the Year of Assessment in which you qualify for the scheme:
- Application Form for Area Representative Status (203KB)
- Employment contract or job description under the foreign employer's letterhead and signed by authorised personnel.
- Travel schedule using Area Representative Travel Calculator (46KB).
If your Area Representative status is approved and your employment arrangement remains unchanged the following year, you need not apply for the status every year. You are still required to submit the Area Representative Travel Calculator (46KB) by 15 Apr (18 Apr if you e-File your tax return) each year to enjoy the tax concession under the scheme.
However, if there is a change in your employment arrangement (e.g. your job scope, the entity which bears your remuneration cost), please inform us to enable us to review your eligibility for the Area Representative status.