How to submit personal income tax in Singapore for 2021?
Personal income tax rate in Singapore is one of the lowest in the world. In order to determine the Singapore income tax liability of an individual, you need to first determine the tax residency and amount of chargeable income and then apply the progressive resident tax rate to it. Key points of Singapore personal income tax include:
- Singapore follows a progressive resident tax rate starting at 0% and ending at 22% above S$320,000.
- There is no capital gain or inheritance tax.
- Individuals are taxed only on the income earned in Singapore. The income earned by individuals while working overseas is not subject to taxation barring a few exceptions.
- Tax rules differ based on the tax residency of the individual.
- Tax filing due date for individuals is April 15 of each year. Personal Income tax is assessed based on a preceding year basis.
Individuals resident in Singapore are taxed on a progressive resident tax rate as listed below. Filing of personal income tax return for tax resident is mandatory if your annual income is S$22,000 or more. Tax residents do not need to pay tax if your annual income is less than S$22,000. However, you may still need to file a tax return if you have been informed by Singapore tax authority to submit your tax return.
| Chargeable Income | Rate (%) | Gross Tax Payable ($) |
On the first 20,000 On the next 10,000 | 0 2 | 0 200 |
On the first 30,000 On the next 10,000 | – 3.50 | 200 350 |
On the first 40,000 On the next 40,000 | – 7 | 550 2,800 |
On the first 80,000 On the next 40,000 | – 11.5 | 3,350 4,600 |
On the first 120,000 On the next 40,000 | – 15 | 7,950 6,000 |
On the first 160,000 On the next 40,000 | – 18 | 13,950 7,200 |
On the first 200,000 On the next 40,000 | – 19 | 21,150 7,600 |
On the first 240,000 On the next 40,000 | – 19.5 | 28,750 7,800 |
On the first 280,000 On the next 40,000 | – 20 | 36,550 8,000 |
On the first 320,000 In excess of 320,000 | – 22 | 44,550 |
How To File Personal Income Tax In 2021
#Earn Incomes
For this segment, it’s essential to know what type of income is taxable and what is not.
Types of taxable income include employment income, business income (including income from online activities), property income (e.g. rental).
Types of non-taxable income include interest income, dividend income, capital gains from properties, shares or financial instruments, annuity income.
Do note the listed items above are not an exhaustive list. It’s important to understand this because you do not want to pay taxes on non-taxable income, or commit an offence by not paying taxes on taxable income.
#Qualify Deductions
Deductions refer to any allowable expenses you incurred or approved donations you made during the year.
Types of deductions include deductions for employees if they incur expenses because of the nature of their work. For example, if they use their own money to pay for business expenses.
If you were working from home in 2020, you can claim expenses incurred for work purposes, such as electricity charges and telecommunication charges, that were not reimbursed by your employer. There are also deductions for rental expenses and donations to approved Institutions of a Public Character.
#Qualify Reliefs
To encourage certain social and economic objectives, personal income tax reliefs are offered to certain groups of taxpayers in Singapore.
Types of reliefs includecourse fees relief, CPF Cash Top Up Relief, CPF Relief, Earned Income Relief, Handicapped Brother/Sister Relief, Life Insurance Relief, NSman (Self) Relief, Parent/Handicapped Parent Relief, Supplementary Retirement Scheme Relief.
It’s important to understand all the different types of reliefs because you want to make sure you do not miss out on any reliefs that you qualify for.
Once you declare that all the information you provided in the tax return form is correct, you’re done. You should see an Acknowledgement Page, which you can save or print for your own records. You may also retrieve a copy of the Acknowledgement Page from the “Notices/Letters” e-Service at myTax Portal.
