SINGAPORE Law and Practice Contributed by: Azmul Haque, Ashley Chew, Hu Yutong and Aaron Leong, Collyer Law LLC
5. Tax Law 5.1 Taxes Applicable to Employees/ Employers
Collective Redundancies An employee who considers themselves dismissed without just cause or excuse by their employer may make a representation through their trade union to MOM to be reinstated in their former employment within one month of the dismissal. Fixed-Term Employment Arrangements Employers and employees may agree that employ - ment will continue for a specified period. In such cases, the contract will generally run until the agreed expiry date, after which the employment relationship comes to an end unless the parties agree otherwise. 4.5 Employee Representations Singapore does not require employees to be repre - sented, informed or consulted by management in every workplace. There is no general requirement for employee representation on company boards. Employee representation may become relevant where employees are unionised. Under the Industrial Rela - tions Act 1960, a trade union may represent employ - ees in collective bargaining only after it has been formally recognised by the employer. Once recog - nised, the union acts as the representative body for the employees it covers, and may negotiate with the employer on matters relating to employment terms and conditions. Consultation may also arise in specific circumstances, including retrenchment exercises involving unionised employees, business transfers affecting employment arrangements, or other situations where consultation is required under applicable collective agreements or sector-specific frameworks. Since 1 January 2025, platform workers, including ride-hail and delivery workers, have been able to be represented by recognised platform work asso - ciations under the Platform Workers Act 2024. These associations may represent platform worker members in engagements and negotiations with platform opera - tors on work-related matters.
In Singapore, the employment relationship is subject primarily to income tax and, where applicable, Central Provident Fund (CPF) contributions. Employee Taxation An individual is subject to Singapore income tax if they are: • tax resident in Singapore (ie, present or working in Singapore for 183 days or more in a calendar year); or • non-resident, deriving income from employment exercised in Singapore (generally where presence exceeds 60 days but is less than 183 days; short- term employment of 60 days or less is generally exempt from the income tax regime). Employees are taxed on employment income, includ - ing salary, bonuses and benefits-in-kind. Tax residents are taxed at resident rates, with a current maximum of 24%. Non-residents are generally taxed at a flat rate of 15% or resident rates, whichever results in a higher tax. Employers are responsible for reporting employee income, but the employee usually remains responsible The CPF is a mandatory social security system for Singapore citizens and permanent residents. Both employers and employees are required to contribute to the CPF. Contribution rates vary based on age and residency status, with total contributions generally up to 37% of ordinary wages, subject to applicable wage ceilings. Employers are responsible for deducting the employee’s share and making monthly contributions. CPF contributions are generally not required for for - eign employees. Employers must also: for their own tax liability. Employer Obligations
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