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Q：
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Who must withhold tax?
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A：
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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.
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Q：
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What are the payments to a Non-resident require you to withhold tax ?
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A：
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The Interest, commission, and fee for any loan or indebtedness.
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Royalty and other payments for the use of any movable property.
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Management fee which includes payment to the management or assisting the management in the execution of trade, business or profession.
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Payment for the use and the right to use any scientific, technical, commercial and industrial knowledge as well as information.
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Rent and other payments for the use of any movable property.
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Remuneration to a non-resident director.
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Payment made to non-resident professionals which include consultants, coaches, trainers and foreign speakers etc.
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Payment made to any non-resident public entertainer which includes artists, musicians etc.
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Distribution from the Real Estate Investment Trust (REIT) which is an instrument to investment in a real estate portfolio.
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Withdrawal from Supplementary Retirement Scheme (SRS) by non-citizen members. This is a government scheme which helps the people save for their old age as it offers various tax benefits.
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Q：
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How much tax you should withhold?
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A：
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The withholding tax rates differ depending on the type of payment. However, in certain cases, where Singapore has entered into an Avoidance of Double Taxation Agreement with the country where the non-resident resides, the tax rate may be lower as specified in the treaty.
For more details on the withholding tax rates, you may refer to Withholding Tax Rate.
Following is a list of the payment types and the applicable rates:
Payment Type
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Rate
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Interest, fees and payments relating to loan or indebtedness
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15%
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Royalty and payments in connection with use of movable property
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10%
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Income of non-resident professionals received for their services in Singapore
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15% on gross income or 20% on net income (w.e.f. 1 Jan 2016 rate is 22%)
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Payment with respect to the use of any scientific, technical, industrial, commercial knowledge and information
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10%
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Technical assistance, service fees as well as management fees
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Non-resident companies: Prevailing corporate tax rate
Non-resident individuals: 20% on gross payment (w.e.f. 1 Jan 2016 rate is 22%)
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Rent and payments for use of movable property
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15%
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Charter fees (ships and aircraft)
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0 - 2%
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Director's remuneration or fees in case of non-resident directors
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20%
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Director's remuneration or fees in case of non-resident directors
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15% (on gross income)
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Distribution from the real estate investment trust to a non-resident unit holder
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10%
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Withdrawal from Supplementary Retirement Scheme (SRS) by non-Singaporean members
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20% (w.e.f. 1 Jan 2016 rate is 22%)
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Dividend
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Exempt
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Q：
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When to file and pay withhold tax?
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A：
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As a payer, you are required to e-file and pay the withholding tax to IRAS by the 15th of the second month from the date of payment to the non-resident.
The date of payment is defined as the earliest of the following dates:
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1.
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When the payment is due and payable based on the agreement or contract, or the date of the invoice in the absence of any agreement or contract (credit terms should not be taken into consideration)
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2.
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When payment is credited to the account of the Non-Resident or any other account(s) designated by the Non-Resident
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3.
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The date of actual payment
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4.
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Director's Fees
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a)
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Director 's Fees Approved in Arrears - the date the fees are voted and approved at the company's AGM
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b)
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Director 's Fees Approved in Advance - as and when he renders his services
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Q：
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Who are non-resident companies or individuals?
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A：
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For Singapore tax purposes, non-resident companies refer to:
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Companies incorporated outside Singapore that have operations in Singapore
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Singapore-incorporated offices that are managed and/or controlled outside Singapore
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Singapore branches of foreign companies
Non- resident individuals refer to any individual who is present or employed in Singapore for a period less than a total of 183 days is considered to be a non-resident.
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FAQ
