Director's remuneration refers to both cash and non-cash payments and includes:
See also Understanding the Tax Treatment.
As a concession, airfare paid by employers for directors to attend board meetings is not taxable.
Revised tax treatment for directors travelling into Singapore on or after 1 January 2016 for business purpose
- The following payments made by your employer are not taxable:
- Travelling and entertainment (which have been expended for business purpose)
- Introduction of an IRAS acceptable rate for per diem allowances for directors travelling into Singapore for business purpose
- Per diem allowance would not be taxable unless it is in excess of the acceptable rate. For directors who travel into Singapore for business purpose, the acceptable rate for 2021 and 2022 respectively is $140 per day.
- The acceptable rates determined by IRAS are strictly for Income Tax purpose and are reviewed yearly. The rates do not determine the amount of per diem allowance that an employer wishes to pay its directors.
#1 Director's fees and physical presence
The non-resident director resides overseas and did not attend the board meetings held in Singapore but was paid a director’s fee of $2000 by the company which is a tax resident in Singapore. Are the director's fees taxable?
Yes, payments that are paid by the company which is a tax resident in Singapore are taxable regardless of the non-resident director's physical presence here.
#2 Director's fees not yet remitted
Would director’s fees declared to a non-resident director by a company which is a tax resident in Singapore but not remitted to the director subject to withholding tax?
Yes, the director's fees declared by a company which is a tax resident in Singapore would still be subject to withholding tax.
#3 Withholding tax and apportionment of remuneration
A non-resident director spent all or most of his time (95%) out of Singapore. Is the full remuneration that is paid by the company which is a tax resident in Singapore subject to withholding tax, or only the portion of remuneration (remaining 5%) subject to withholding tax?
Yes, the full amount of remuneration is subject to withholding tax.
#4 Director's remuneration paid from overseas
The non-resident director’s remuneration is voted and approved by the company which is a tax resident in Singapore. A portion of it is paid in Singapore and the rest in the director's home country. Is withholding tax applicable only to amount paid in Singapore?
The full amount of director's remuneration is subject to withholding tax, whether paid in Singapore or not.
#5 Director's fees and tax treaties
The non-resident director is a resident of a country which has a tax treaty with Singapore. If he receives directors' fees from a company resident in Singapore, is he liable to tax in Singapore?
Whether he is liable to tax in Singapore would depend on the provisions in the tax treaty. Generally, director's fees derived from a company which is a tax resident in Singapore is taxable here.
#6 Foreign company and Singapore subsidiary
A director was paid director's fees by a foreign company which has a subsidiary in Singapore. He attended a meeting in Singapore. Is he liable to tax in Singapore?
No, he will not be liable to Singapore income tax as the director's fees are paid by a foreign company with no presence in Singapore. The foreign company with a subsidiary in Singapore is not considered to have a presence here.
#7 Foreign company and Singapore branch
A director was paid director's fees by a foreign company which has a branch in Singapore. He attended a meeting in Singapore. Is he liable to tax in Singapore?
Yes, he will be liable to Singapore income tax on the director's fees paid by the foreign company as it is considered to have a presence in Singapore through a branch in Singapore
#8 Taxation of director's fees
Which date is considered to be the date of payment for director’s fees?
The date of payment is the date they are voted and approved at the company's Annual General Meeting.