Taxes in Singapore

In Singapore, income taxes are divided into two categories, Corporate or company income tax or individual income tax. It is, therefore, important to understand how different people and organizations have to pay the taxes for the smooth running of the nation.
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The most important things about the taxes of Singapore in 2015 are the tax rates and tax brackets that are given to the corporate and individuals.Taxes in Singapore 2015

There are different types of individuals in Singapore who are supposed to pay tax. There is a tax to be imposed on local foreigners, new taxpayers, and compliance matter. However, all these individuals are expected to pay tax ranging from the rates of 0% to 20% of the Year of Assessment and a gross tax pay ranging from $0to $42,350. The individual should know whether he/she is a resident or a non-resident before tax is paid. Some of the qualifications are,

  •  If he/she is a Singaporean and has a permanent home in Singapore
  •  Someone who resides in Singapore except for being absent temporarily
  •  183 days old in Singapore
  •  Foreigner who has worked in Singapore for more than 183 days

As for the year of assessment, 2015, a personal tax rebate of 50% of the net tat to be paid, a maximum of up to $1000 is granted to the individual. For the non-resident individuals, the tax to be paid is 15% the income the person gets from employment. Resident rates can also apply to the non-resident as long as it results in a higher tax amount. For those who are doctors, consultants and those who get other forms of income, they will get a tax rate of 20% as per the Year of Assessment onwards.

Like individual income tax, corporate or company income taxes are supposed to be paid at the end of every year. However, the foreign income that a corporation in Singapore earns might require dual taxation once from the origin in which the income is earned and in Singapore. In this case, such businesses can assert Foreign Tax Credit that is to be paid on the same income. These companies have their tax rates which are different from the fee rates of individuals. As from 2010 till date the tax rate to companies is 17%. Hence, as from the year of assessment 2013,2014 and 2015, companies will be given a 30% Corporate Income Tax Rebate restricted at $30000 for each year of assessment. However, a company can be exempted from the tax rates if:

  •  It was built-in in Singapore
  •  It has, not more than 20 shareholders throughout the year of assessment
  •  Has a tax resident in Singapore for that Year of Assessment

For the new Companies that are starting or the new startup firms, there is an exemption and tax rate given to them. This is effective from Year of Assessment. The exemption is 50% and a tax bracket of up to $200,000 as the normal chargeable income.