Overview
Withholding tax in Singapore
Withholding tax is generally a final tax where the income in question is not derived from the provision of services.
Filing and payment deadline
By 15th of the second month, following the date of payment to the non-resident
Range of tax rates
Up to 24%, depending on the nature of income (may be reduced under tax incentives or Tax Treaties)
Payments attributable to certain services performed in Singapore will be subject to a non-final rate of 17% unless the supplier of the services is a non-resident individual. In this case the rate may be 24% or some other rate, depending on circumstances, as shown in the table below.
A non-final tax allows the non-resident to file a tax return and claim relevant expenses against the gross payments. A final tax does not allow this.
Withholding tax has to be accounted for to the Comptroller of Income Tax by the 15th of the second month following the date of payment or deemed payment to the non-resident.
Payments to the Singapore branch of a non-resident business are not subject to withholding tax. However, the branch must include the income in its annual tax return.
Withholding tax rates by nature of income
The following payments made to non-residents may be subject to withholding tax:
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Interest
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15%*
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Dividends
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NIL
|
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Royalties or other lump sum payments for the use of immovable properties
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10%*
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Technical fees for services performed in Singapore
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17%
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Management fees for services performed in Singapore
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17%
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|
Real estate investment trusts (REIT) distribution of taxable income to non-resident (other than an individual)
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10%*
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|
Rental or other payments for movable property
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15%*
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|
Remuneration paid to non-resident director
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24% (22% prior to 1 January 2023)
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|
Professional fee
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15% on gross / 24% (22% prior to 1 January 2023) on net
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|
Public entertainer’s fee
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15%
|
|
Charter fees (ships)
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NIL
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|
Charter fees (aircraft)
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0-2%
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*These are final taxes for operations carried on outside Singapore. For operations carried on in Singapore, 17% will apply to non-resident non-individuals and 24% will apply to non-resident individuals. Prior to 1 January 2023, this rate was 22%.
#The reduced withholding tax rate of 10% applies to distributions made during the period from 18 Feb 2005 to 31 Dec 2025.
Characterisation of payments using the rights-based approach
With effect from 28 Feb 2013, the IRAS has adopted a rights-based approach to characterise the following payments for withholding tax purposes:
- payments for software
- payments for the use of or the right to use information and digitised goods.
The rights-based approach characterises a payment based on the nature of the rights transferred in consideration for the payment. It distinguishes between the transfer of a “copyright right” (which may be subject to withholding tax) and a “copyrighted article” (which is generally not subjected to withholding tax).
A transaction involves the transfer of a “copyright right” if the payer is allowed to exploit the copyright commercially, whilst a transaction involves the transfer of a “copyrighted article” if the buyer merely acquires the right for his own personal consumption or for use within his business operations.
An outright sale of all the beneficial ownership rights in intellectual property should generally not be subject to withholding tax.
Eng Min Lor
Partner - Corporate Tax
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