Tax Planning for Expats Living and Working in Singapore

bookkeeping services in Singapore

Moving to a new country can be an exciting adventure, but it also comes with a lot of responsibilities. 

One of the most significant challenges expats face when relocating to Singapore is navigating the country’s complex tax system. Tax planning for expats is crucial to ensure compliance with local laws and regulations and optimize tax savings.

In this blog post, we’ll discuss the importance of tax planning for expats living and working in Singapore and provide some helpful tips on how to approach this task. We’ll also highlight the role of a tax expert or tax advisor in assisting with tax planning.

bookkeeping services in Singapore


Why is Tax Planning for Expats Important?

Expats living and working in Singapore are subject to the country’s tax laws, which differ from those in their home countries. Singapore has a progressive personal income tax system with tax rates ranging from 0% to 22%. 

Expats are taxed on their income earned in Singapore, regardless of where the income is paid. Additionally, they may be subject to tax in their home countries on their Singapore income, depending on their tax residency status and the tax laws of their home countries.

To avoid paying unnecessary taxes and penalties, expats must plan their tax affairs carefully. Tax planning allows expats to optimize their tax savings, minimize their tax liabilities, and ensure compliance with local tax laws. 

By understanding the tax rules and regulations, expats can take advantage of tax incentives and deductions, structure their affairs efficiently, and plan for their tax obligations in advance.

Recommended post: Tax Planning and Preparation for Businesses in Singapore

Tips for Tax Planning for Expats in Singapore


Determine Your Tax Residency Status

Expats living and working in Singapore must determine their tax residency status to know how much tax they are liable to pay. Tax residency is based on the number of days spent in Singapore and the individual’s intention to stay in Singapore for the long term. 

Expats who are tax residents in Singapore are taxed on their worldwide income, while non-residents are only taxed on their Singapore-sourced income. It’s essential to determine your tax residency status before making any tax planning decisions.

Understand Singapore’s Tax System

To plan your taxes effectively, you need to understand Singapore’s tax system. Singapore’s tax system is based on self-assessment, which means that taxpayers must file their tax returns and pay their taxes on time. 

Taxpayers must also keep accurate records of their income and expenses to support their tax returns. Understanding the tax system will help you identify tax-saving opportunities and avoid tax penalties.

Recommended post: How to Prepare for Your Tax Filing in Singapore: Tips from the Pros

Take Advantage of Tax Incentives and Deductions

Singapore offers various tax incentives and deductions to encourage investment and entrepreneurship. For example, expats can take advantage of the Not Ordinarily Resident (NOR) scheme, which provides tax exemptions for the first three years of their employment in Singapore. 

Additionally, expats may be eligible for tax deductions for expenses related to their work, such as travel expenses, home leave passage, and rental expenses.

Plan for Your Retirement

Expats should also plan for their retirement, as this can have significant tax implications. Singapore’s Central Provident Fund (CPF) is a mandatory savings scheme that provides retirement, healthcare, and housing benefits to Singaporeans and Permanent Residents. Expats who are Singapore tax residents are also required to contribute to their CPF accounts. 

By planning for your retirement, you can ensure that you have enough savings to meet your retirement needs and minimize your tax liabilities.

Seek Professional Tax Advice

Tax planning can be a complex and time-consuming process, especially for ex-pats who are not familiar with Singapore’s tax system. 

A tax specialist or tax advisor can provide valuable advice on tax planning, identify tax-saving opportunities, and help you comply with local tax laws. A tax expert can also assist with tax filing, tax audits, and more.

Recommended post: 6 Benefits of hiring a tax agent or a tax advisor in Singapore

Tips for Singapore expats to hire a reliable accountant


If you are an expat in Singapore, one of the most important decisions you will make is hiring a reliable accountant to help you manage your finances. Below, we’ll explore some tips for expats in Singapore to hire a reliable accountant.

Look for a certified accountant

One of the first things you should look for when searching for an accountant in Singapore is their certification. The Institute of Singapore Chartered Accountants (ISCA) is the national accountancy body in Singapore and is responsible for regulating the accountancy profession. 

Ensure the accountant you choose is a member of ISCA and holds the necessary qualifications to provide accounting services in Singapore.

Consider the accountant’s experience

Experience is crucial when it comes to accounting services in Singapore

Look for an accountant who has experience working with expats or international clients. This experience will enable them to understand your unique situation and provide tailored solutions to your financial needs. You can ask for references or read online reviews to gauge the accountant’s experience.

Understand the accountant’s services

Before hiring an accountant, ensure you understand the range of services they offer. Some accountants may offer bookkeeping services, while others may provide tax planning, audit, or financial advisory services. 

You should also find out if the accountant provides online accounting services or if they require you to visit their office. Understanding the accountant’s services will help you determine if they are a good fit for your needs.

Recommended post: FAQs related to accounting & bookkeeping services in Singapore

Check the accountant’s fees

Accounting services in Singapore can be expensive, and it’s essential to understand the fees charged by the accountant. Most accountants charge by the hour or a fixed fee for specific services. 

Ensure you get a detailed breakdown of the accountant’s fees before hiring them. You can also compare the fees charged by different accountants to get an idea of the prevailing rates in Singapore.

Look for an accountant who speaks your language

English is widely spoken in Singapore, but it may be challenging to communicate complex financial matters in a language that is not your first language. 

Look for an accountant who speaks your language, or at least one who can communicate effectively in English. This will help you understand your financial situation better and enable you to make informed decisions.

Get a feel for the accountant’s personality

It’s essential to work with an accountant who you feel comfortable with, and who understands your financial goals. 

Arrange a meeting with the accountant and get a feel for their personality. Ask questions about their approach to accounting and how they work with clients. If you feel uncomfortable or feel like the accountant is not a good fit, continue your search.

Choose an accountant who is up-to-date with technology

Technology is changing the accounting industry, and it’s essential to work with an accountant who is up-to-date with the latest accounting software and tools. 

Ensure the accountant you choose uses cloud-based accounting software, which makes it easy for you to access your financial information from anywhere in the world.

Recommended post: How to Hire a Tax Advisor in Singapore & What Are The Benefits?


More Posts

ACRA Cancels Registration of Filing Agent and Qualified Individual for AML/CFT Breaches

The Accounting and Corporate Regulatory Authority (ACRA) had cancelled the registrations of filing agent (RFA) and qualified individual (RQI) on 18 January 2024. The registrations were cancelled in view of breaches of anti-money laundering and countering the financing of terrorism (AML/CFT) controls under the ACRA (Filing Agents and Qualified Individuals) Regulations 2015 (the “ACRA Regulations”).

Some of the basic AMT/CFT controls that a RFA and RQI are required to exercise are as follows:

(a) perform additional customer due diligence measures when a customer is not physically present during onboarding;

(b) inquiring if there exists any beneficial owner in relation to some of its customers; and

(c) perform risk assessments i

RQIs and RFAs provide corporate secretarial services for business entities, such as helping customers to incorporate companies, file annual returns and fulfil other filing requirements under the Companies Act 1967 or other Acts under ACRA’s purview. RQIs and RFAs are required to perform customer due diligence measures in accordance with the ACRA Regulations, and conduct their business in such a manner as to guard against the facilitation of money laundering and the financing of terrorism. RQIs and RFAs must also satisfy statutory requirements such as being fit and proper persons, to be registered or continue to be registered.

RQIs and RFAs who breach their statutory obligations may be subject to enforcement actions, such as financial penalties of up to $10,000 or $25,000 per breach respectively or have their registrations with ACRA suspended or cancelled.

Therefore, RQIs and RFAs play an important role in helping to detect and combat illicit activities.

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