Mercans CountryIntel ® Singapore Payroll And HR Insights
Singapore is a global hub for business, with many top multinationals and fast-growing startups choosing to set Singapore as their headquarters. With a vibrant ecosystem that features over 150 venture capital funds, incubators and accelerators, Singapore has been consistently ranked as one of the world’s most innovative cities.Download PDF
The Singapore government is committed to creating a pro-business environment through its economic and manpower policies, transparent tax regime, compliance with global standards and strong IP (intellectual property) protection. Over S$8.3 billion has been put aside over three years to spur economic transformation and business growth. This sits alongside tax incentives for qualifying expansionary economic activities and grants to support training and building capabilities in research and innovation.
Entity Registration and Incorporation Requirements
Setting up a new business or expanding an existing one in Singapore is straightforward. Choose how your company operates from a range of entity types which suit your individual circumstance.
Banking Hours: Monday - Friday from 9:30 am - 3:00 pm
The standard working week is from Monday to Friday from 9:00 am - 7:00 pm
The Singapore EDB (Economic Development Board) has curated a network of business partners to help companies expand into Singapore. This network includes support in accounting and taxation, legal advisory, banking, office space solutions, recruitment and HR solutions, market entry advisory and more. Singapore’s main labor law is the Employment Act which covers the basic terms and working conditions for most types of employment.
Electronics, chemicals, biomedical sciences, logistics and transport engineering.
Dates & Numbers
Official State Name
Republic of Singapore
English, Tamil. Malay and Mandarin Chinese
International Dialing Code
Employers must pay all employee salaries at least once a month and within seven days after the end of the salary period. Exceptions include overtime and resignation without notice
It’s acceptable to provide employees with online payslips
Payroll report must be kept for 2 years
Usually 7 days in the first year, increasing by one day for each year of service. However,, employers may even grant 14 - 20 days for employees after one year
Employees are entitled to 370 days of paid sick leave with at least six months’ service. The first three days are paid by the employer at 89% of the salary rate
16 weeks of paid maternity leave and 2 weeks of paid paternity leave
Maternity & Paternity Leave
As stipulated by the employment contract, there is a customary 13th month salary at the end of the year
13th month salary
No national minimum wage applies
15% of the hourly rate for employees
Usually provided after two years of completed service, employees will be paid 2 - 4 weeks’ pay for each year of employment.
Income tax rates depend on the individual’s tax residency status. The personal income tax rates for resident taxpayers are progressive, that is, higher income earners pay a proportionately higher rate. The CPF (Central Provident Fund) is a compulsory savings and pension plan for Singaporeans and permanent residents. It serves to fund their retirement, healthcare and housing needs.
Employment income of non-residents is taxed at a flat rate of 15% or the progressive resident tax rates (whichever is higher). Certain income of non-resident individuals is also subject to withholding tax (the rate depends on the type of income derived).
Corporate Income Tax
Personal Income Tax
A key pillar of Singapore’s social security system, the CPF can be withdrawn from, at the age of 55. The government also supplements CPF savings of lower wage workers through schemes such as Workfare (targeted at Singaporean workers whose earnings are in the bottom 20%) and top-ups to MediSave (national medical savings scheme that helps individuals set aside part of their income to meet healthcare needs).
Social Security Rate
Social Security Rate for Employers
Social Security Rate for Employees
Employers are required to provide KETs (Key Employment Terms) to employees covered under the Employment Act and if they are hired for a continuous period of 14 days or more. Companies that operate multi-country payroll should ensure that where Singapore is concerned, proper records of employee attendance and working hours must be maintained. This minimizes misunderstandings and disputes. Regulations on working hours and overtime payments under the Employment Act are only applicable to workmen whose basic monthly salaries do not exceed $4,500 and non-workmen whose basic monthly salaries do not exceed $2,600. They are not applicable to managers and executives.
Key employment terms (KETs) must include the job title and main duties of the individual, start date for employment, duration of employment (if on a fixed-term contract), working arrangements, salary period, salary (including allowances, deductions, bonuses and incentives), types of leave and more.
The Work Injury Compensation Act (WICA) allows employees to make claims for work-related injury or disease without having to take legal action. Certain types of work-related accidents must be reported to the Ministry of Manpower and there are also different reporting requirements for different types of accidents.
Employee leave entitlements include paid annual leave, paid sick leave and paid hospitalization leave. Where an employee has worked for at least three months but less than a year, the number of days they are entitled to will be prorated based on the number of full months they have worked.
Either the employer or employee can terminate a contract of service. During termination, the employee must give the employer advance notice in writing or pay compensation in lieu of notice. If however the termination is due to misconduct, the employer must hold an inquiry before instituting disciplinary action. If an employee believes that they have been wrongfully dismissed, a wrongful dismissal claim could be filed at TADM (Tripartite Alliance for Dispute Management).
Minimum notice period for terminating an employee
Total number of public holidays
Working hours per week
Up to four weeks
Total number of days for Compassionate & Bereavement Leave
Foreign investors and entrepreneurs who are interested in setting up a base in Singapore can apply for either the EntrePass or apply for Singapore Permanent Residence (PR) under the Global Investor Programme (GIP).
There are different types of work permits such as for migrant workers, migrant domestic workers and confinement nannies. There are also different types of passes such as the Employment Pass, Dependent’s Pass and the Long Term Visit Pass. Successful applicants for the EntrePass will be awarded a one year pass. The GIP for which applicants will need to meet criteria, accords PR status to investors with a substantial business track record.
Work Permit validity
Completed application form
Certificates by educational institutions indicating study undertaken
Work experience certificate
Two color photographs
Description of the nature of work to be performed by the applicant.
Build the best team and hire top talent compliantly in Singapore. Get in touch with Singapore payroll outsourcing & PEO specialists for a free consultation!