Understanding Income Tax in Singapore



Modified on: Wed, 24 Sep, 2025 at 12:57 PM

TABLE OF CONTENTS



Whether you're a local or foreign employee, Horizons is here to support you in staying compliant and ensuring your payroll is processed accurately and on time.


What Horizons Does


For Local Employees

  • Monthly: We track your salary, bonuses, and benefits. No tax is deducted from your pay.
  • Annually: By March 1, we submit your income details to the Inland Revenue Authority of Singapore (IRAS) via the Auto-Inclusion Scheme (AIS). This means your income is automatically included in your tax return.


For Foreign Employees (EP, S Pass, Work Permit holders, etc.)

  • Monthly: No tax is deducted from your salary.
  • Annually: We submit your income details to IRAS via AIS by March 1.
  • When You Leave:
    • We file Form IR21 (Tax Clearance) to IRAS to report your income.
    • This applies to all work pass holders, including Personalised Employment Pass (PEP) holders.
    • Your final month’s salary is withheld until IRAS confirms your tax clearance.
    • Horizons will remit the tax amount to IRAS within 10 days of receiving the Directive to Pay Tax. Your final salary is released once IRAS confirms clearance.



What You Need to Do


1. Check Your Income Details

By March, log in to the myTax Portal to review the income details we’ve submitted. If you spot any errors, let us know so we can correct them.


2. Declare Additional Income

If you have other sources of income (e.g., freelance work, rental income) or want to claim tax reliefs, file your tax return (Form B/B1) by April 18 – May 18 (for e-filing).


3. Pay Your Taxes

Once you receive your Notice of Assessment (NOA), pay the amount by the due date. If your final salary doesn’t cover the full tax amount, you’ll need to pay the balance directly to IRAS.


4. If You Disagree with Your Tax Bill

  • Pay First, Dispute Later: IRAS requires full payment by the due date, even if you plan to file an amendment or appeal. Unpaid taxes may result in penalties or interest.
  • How to Amend: You (or your tax agent) can file an amendment via the myTax Portal or email IRAS after payment.
  • Refunds: If IRAS accepts your amendment, any refund will be issued directly to you within 30 days. Horizons is not involved in the refund process.
  • Optional Support: Horizons can assist with filing objections or liaising with IRAS as a paid service.



Key Things to Remember

  • Horizons submits your income details via AIS by March 1.
  • For foreign employees, final salary is withheld during offboarding until IRAS confirms tax clearance.
  • You must pay assessed tax first, even if you plan to object.
  • You can file objections directly with IRAS or request Horizons’ help as an optional service.

Why This Matters

We handle the paperwork to ensure everything is accurate and timely. Your role is to check your details, declare any extra income, and pay your taxes. Together, we make tax season smooth and stress-free.


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