Responsibilities as an Employer in Singapore

Responsibilities as an Employer in Singapore

Being an employer in Singapore comes with a number of responsibilities concerning its employees to ensure decent working conditions and its tax filing obligation.

Employment Act

Under the Employment Act, employers have a series of fundamental obligations to fulfill towards their employees. They must:

  • Pay their salary on time
  • Pay for overtime work
  • Give them one rest day a week
  • Give them annual and sick leave, and paid public holidays
  • Pay CPF contributions on time and correctly
  • Not allow wrongful dismissal

 

CPF Contributions

The Central Provident Fund (CPF) is Singapore’s social security system addressing retirement funds, healthcare, home ownership, family protection and asset enhancement.

The contributions are payable for Singapore Citizens and Permanent Resident who are working under a contract of service in Singapore, on a permanent, part-time or casual basis. The employer pays the share of the employee which he can recover afterwards from its salary.

For Singapore Citizens or Permanent Residents working oversees, contributions are not mandatory.

Besides CPF contributions, employer has to include SDL (Skill Development Levy) and others donations such as (ECF/SINDA/CDAC/MBMF) ranging from $0.50 to $30

More information on who is entitled to CPF contributions can be found on the Ministry of Manpower (MOM) website.

Tax Responsibilities

Every employer in Singapore has a number of fiscal obligations with the IRAS regarding their employees. By 1st March every year, they have to prepare tax forms for their employees, mainly form IR8A which concern employee earnings and which must be completed for all employees (full-time residents, part-time residents, non-residents, company directors, board members receiving fees, pensioners, employees who have left but were in receipt of income in the previous year). 

The employer may prepare other forms depending of the employee’s situation:

  • for employees who were provided with benefits-in-kind, Appendix 8A;
  • for employees who derived gains or profits from Employee Stock Option (ESOP) Plans or other forms of Employee Share Ownership (ESOW) Plans, Appendix 8B; and
  • If the employer has made excess CPF contributions on the employees’ wages and/or have claimed or will claim refund on excess CPF contributions, form IR8S.

 

Employers under Auto-Inclusion Scheme (AIS) for Employment Income

They must submit their employees’ income information to IRAS electronically by 1st March every year under the AIS. The information submitted will be shown on the employees’ electronic tax return and will be automatically included in their income tax assessments. AIS employers do not need to issue hard-copy Form IR8A and the appendices to their employees. However, employee who has other income received from another employment or require to amend this/her personal tax relief will need to update manually in the tax portal.

Employers Not under the AIS for Employment Income

Employers who are not under the AIS for Employment Income have to provide the hard-copy Form IR8A and appendices (where applicable) to their employees by 1st March every year to file their income tax returns. Employers need not submit the forms to IRAS.

How Ace Success can help you fulfill your responsibilities as an employer?

Keeping up with all your compulsory obligations and managing your business at the same time can be challenging. This is why outsourcing such tasks as payroll and tax filings to Ace Success could be the perfect solution for you. Ace Success provides you with efficient services regarding individual income tax, corporate tax, accounting, recruitment & payroll and much more, allowing you to focus on growing your business.

Are you still rushing to get your accounts up to date?

Get in touch with us.
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