Working freelance in Singapore

[PNGMK]

I've helped a few folk recently work out how to become SEP (self employed persons or professionals) in Singapore. I've not been able to find a definitive explanation or ruling on the IRAS website. This is important as we know that CPF particularly do not like contractoring being used to avoid CPF payments. My view is that if there is a contract to deliver a particular good or service in place and you, the SEP, are doing this for multiple parties, then you are a self employed professional. However input from the hive mind is appreciated.

[NYY1]

I've helped a few folk recently work out how to become SEP (self employed persons or professionals) in Singapore. I've not been able to find a definitive explanation or ruling on the IRAS website. This is important as we know that CPF particularly do not like contractoring being used to avoid CPF payments. My view is that if there is a contract to deliver a particular good or service in place and you, the SEP, are doing this for multiple parties, then you are a self employed professional. However input from the hive mind is appreciated.

IMO, serving multiple parties is probably the strongest piece of evidence that one is an independent contractor. There are other factors like control and resources used in the production of the good/service, but I would think one is still pretty safe as long as there are multiple clients (assuming one is not like 99.9% of the revenue or some other odd situation).

[S1387]

Hi, have been following the threads and understand that this falls under the ""Income earned from services rendered in Singapore is taxable. This also applies to those working for foreign employers."
Just wanted to reach out to the group so see if i am missing anything here.

Context: SG PR with an consulting opportunity with a firm in ME. The salary to be paid in an ME account (no taxation there)

Work setup: Primary working from SG, attending ME for client meetings/trainings.

I want to retain my SG PR, and plan to continue staying in SG (family has their PR dependent on me). Did note that for REP renewal, i might need to provide documentary evidence of local employment.

Question: What does local employment here mean? Can i as an independent consultant fall in the category of local employment? As mentioned by PNGMK above, is this via the SEP route?

In this scenario, while tax can be declared by me in SG based on the earned income as a part of the contract, how does CPF come in? I can pay the employee part, does the employer (ME entity) also need to pay?

[PNGMK]

Hi, have been following the threads and understand that this falls under the ""Income earned from services rendered in Singapore is taxable. This also applies to those working for foreign employers."
Just wanted to reach out to the group so see if i am missing anything here.

Context: SG PR with an consulting opportunity with a firm in ME. The salary to be paid in an ME account (no taxation there)

Work setup: Primary working from SG, attending ME for client meetings/trainings.

I want to retain my SG PR, and plan to continue staying in SG (family has their PR dependent on me). Did note that for REP renewal, i might need to provide documentary evidence of local employment.

Question: What does local employment here mean? Can i as an independent consultant fall in the category of local employment? As mentioned by PNGMK above, is this via the SEP route?

In this scenario, while tax can be declared by me in SG based on the earned income as a part of the contract, how does CPF come in? I can pay the employee part, does the employer (ME entity) also need to pay?

1. It looks to me as though all of your income is derived by work done in Singapore for a single ME entity hence taxable here, however you can actually claim a rebate for days worked outside Singapore as well. There is a special form and application for that (Area Representative https://www.iras.gov.sg/taxes/individua ... n-employer). What your are doing is quite common for a PR and you will have no issue obtaining an REP in my opinion but you may be asked how you are working - in this case typically you might provide a copy of your employment contract. You're not an SEP in my view.

2. The definition of an SEP is here: https://www.iras.gov.sg/taxes/individua ... yed-person

Note the clauses are fairly easy to interpret:

You are employed or an employee if you perform work under a contract of service where you work under the control of your employer. (This would be "show up here 40 hours a week at $10/hr to drink kopi and build robots for me PNGMK and I'll pay your CPF").

You are self-employed when you perform work for others (e.g. provide a service) under a contract for service. (Note that this may be a verbal contract - such as "build a robot for $50,000 PNGMK by the end of the month and send me an invoice when done").

I don't consider you an SEP but a SPR under contract to a foreign employer.

3. For CPF you pay on a voluntary contribution basis as you wish (foreign employers are NOT required to pay CPF for you). I have previously set up a foreign employer to pay the ER portion but frankly it is not needed and a giant hassle. You can pay the full $37740 as a VC (and SRS also if you wish).

There is a lot of fluff on the IRAS website about foreign employers doing this form or that form (IR8A and IR21)- you can probably ignore it - report your income under income on the income tax form B every april IR8A and you're good to go. You may have to remember to log in and do it yourself as you may not get a reminder from IRAS and obviously you won't get one from your employer. The expectation by IRAS that foreign non resident employers will do anything for IRAS is a bit unrealistic for 'contractors' which is what I would classify you as.

[S1387]

Fantastic, thank you PNGMK! This is very clear definitions and context.