Singapore Withholding Tax Guide
Singapore withholding tax (also known as tax deduction at source in many other countries) is applicable to certain types of payments to non-resident individuals and companies. In general, withholding tax is the tax charged to a non-resident company or individual that derives income from a Singapore source for services provided or work done in Singapore. When a Singapore company or individual pays a non-resident for services, a percentage of that payment must be withheld and handed over to the Inland Revenue Authority of Singapore (IRAS), hence the term withholding tax. Withholding tax does not apply to Singapore resident individuals and Singapore resident companies.
Singapore Withholding Tax Guide - Withholding Tax at a Glance
In general, the following factors determine the applicability of withholding tax in Singapore:
1. Was the income derived from a Singapore source? Withholding tax applies to income from a Singapore source only.
2. Is the payment receiving party non-resident in Singapore? Withholding tax applies only to non-resident entities.
3. Was the service / work done in Singapore? Withholding tax applies only to cases where service provided or work done was in Singapore.
4. What was the nature of payment? Only specific types of payments attract withholding tax.
Singapore Withholding Tax Guide - Avoidance of Double Tax
Singapore has signed double tax agreements (DTA) with many countries in order to prevent companies and individuals being taxed by both jurisdictions. If a company operates out of a country that has a tax treaty with Singapore, the DTA may provide relief from double taxation, depending on the particular service provided and the provisions of the DTA.
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