Basic Payroll Requirements In Singapore

Singapore is one of the countries that do not enclose a minimum salary condition. Based on the Employment Act of Singapore, wages refers to all remuneration, including allowances allocated to an employee for work done on the basis of the contract of service. It does not include traveling, food or housing allowances.

Employers must pay salaries at least once a month, or at shorter intervals if they choose. Salaries must be paid within 7 days after the end of the salary period – non-payment of salary is an offense.

As of 1 April 2016, all employers must issue itemized pay slips to employees covered by the Employment Act. Hard or soft copies are acceptable and should include details such as the date of payment, basic salary and allowances, overtime pay, salary period, as well as deductions made. Failure to do so will result in a fine.

The Central Provident Fund (CPF) is a mandatory contribution by the employer and employee. An employee, who is Singaporean or Permanent Resident (PR) of Singapore, and employers are obliged to make CPF contributions based on the rates set by the CPF board. The rates differ based on the employee's age, and also the number of years after obtaining PR status. Employers are required to pay the employer's and employee's share of CPF contribution monthly for all employees within a time frame of 14 days after the end of the month. Employers who fail to do so might face penalties or fines.

Are you keeping detailed employment and salary records for your employees? In Singapore, employers are expected to keep two years of such records for all employees. Records of ex-employees must be kept for one year after they leave employment. This information will be used by IRAS for their assessment of employees' tax liability. Additionally, if your company hires foreign workers, you must notify IRAS and seek tax clearance for the foreign employees by filling Form IR21 at least one month before the employee ceases employment in Singapore, is on an overseas posting or leaves Singapore for a period that exceeds three months. This is to ensure that all foreigners working in Singapore duly fulfill their tax liabilities.

There are many other considerations and statutory payroll requirements that one needs to be aware of. Always ensure that you are kept up-to-date with the latest legislative changes, so as to avoid costly mistakes.

Comments

Things to Include in a Partnership Agreement

Businesses set up as partnerships, legal entities where two or more people own and run a business, enable companies to benefit from multiple owners’ varied knowledge, skills , and resources. A partnership is alike as sole proprietorship, and each partner owns a part of the business’s assets and liabilities. With more than one person making decisions and disturbing outcomes, different aspects of starting and running the business need to be addressed up front. The clearer and more complete the agreement, the less that is up for debate or disagreement when partners don’t quite see eye to eye. So, what should your partnership agreement include? Here’s a list of some key items you should definitely think about addressing in yours: 1. Percentage of ownership You should have a record of how much each partner is contributing to the partnership prior to its opening. Typically, these contributions are used as the basis for the ownership percentage, but this is not a cut and dry formul...

Different Types of Taxes in Singapore

Singapore’s attractive tax policy is a vital part of its long-term approach to developing into the preferred destination for investment and talent from across the globe. Inland Revenue Authority of Singapore ( IRAS ) is the main government agency that levies and collects all taxes in the country. The following are some of the different types of taxes in Singapore. Income Tax Income tax is levied on the total income of individuals and companies. Property Tax Property tax is imposed on owners of unmoveable properties based on the percentage (tax rate) of the annual value of the property. Motor Vehicle Taxes These are taxes, other than import duties, that are imposed on motor vehicles. These taxes are imposed to curb car ownership and road congestion and include the various registration fees, excise duty, road tax and special tax. Customs & Excise Duties Singapore is a free port and has relatively few excises and import duties. The duties are mainly on motor vehic...

IMPORTANCE OF UBS ACCOUNTING SOFTWARE

Accuracy Accounting software can help to increase the accuracy of your records by reducing or eliminating human errors in calculation. Manual bookkeeping processes involve making a lot of mathematical calculations by hand. An incorrect calculation early on in the in the process could have a great impact on the end balance. Computers, on the other hand, are virtually incapable of making such errors. However, it should be noted that accounting software is not immune to human errors arising from data entry or interpretation mistakes. Speed Using accounting software allows businesses to process their accounts with greater speed than manual processing. Part of this speed increase comes from the use of computers, which are able to process figures far faster than the human brain. In addition, accounting software allows organizations to increase efficiency by introducing automation. Say, for example, that a business needs to record sales tax on all of its transactions. Accounting s...

User Basic Software

Search This Blog