EMPLOYMENT LAW: TAXES / SOCIAL SECURITY CONTRIBUTIONS
Taxation in Singapore
Income Tax
Singapore operates a progressive income tax system. This means that higher incomes are taxed at higher rates. The Inland Revenue Authority of Singapore (IRAS) is responsible for income tax administration.
Tax Deductions: Employees can claim various tax reliefs and deductions, such as CPF contributions, personal reliefs, and expenses incurred for employment income.
Tax Filing: Individuals typically file their income tax returns annually.
Central Provident Fund
Singapore has a mandatory social security system called the Central Provident Fund (CPF). Both employers and employees contribute to the CPF.
CPF Contributions: A portion of an employee’s salary is contributed to the CPF by both the employee and employer.
CPF Usage: CPF funds can be used for housing, retirement, healthcare, and investment purposes.
Other Taxes
Goods and Services Tax (GST): A consumption tax levied on most goods and services.
Stamp Duties: Taxes imposed on certain legal documents, such as property transactions.
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