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Got laid off and have to pay tax

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ydnerendy
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Got laid off and have to pay tax

Postby ydnerendy » Wed, 31 Dec 2008 11:19 am

I want to ask about my issue in my company.

I jost got laid off 1st week of this month and this friday my last work in this office.

i've been work in singapore for 1.6 years and before i was holding training past for 1.5 years.
My salary is 2300.
Currently i am holding EP for just one month after convert from the first pass and just now my HRD said that she has to charge the tax before give me the last salary.

My HRD never tell me about the tax and she said will give me the salary after assuming my tax.

1st time i thougt it's a tax for holding EP but when i asked my HRD she said that my Ep tax is $0.
She said that this is for tax since 1st time came in Singapore since i am still holding training pass.

1st question...Is there any such thing?because i still haven't leave the singapore and intend to work in other company as i am had application's for Ep to another company's.

2nd question...Do i have to pay this kind of tax when i haven't leave the singapore at this time and if the answer yes, is it possible if i pay the tax just by my self in another time because i need save the salary until i got another job?

if anyone know about this issue i appreciate if can answer.

thankyou,
Last edited by ydnerendy on Wed, 31 Dec 2008 6:54 pm, edited 1 time in total.

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Postby sundaymorningstaple » Wed, 31 Dec 2008 1:18 pm

Every employer has to file a Tax Clearance (IR21) for departing Foreign Workers (S or EP's) for those earning in excess of 20K/p.a.. This is required by law from IRAS (Inland Revenue). Employers MUST withhold the last month salary until given tax clearance by IRAS. The employer MUST pay the taxes on behalf of the departing employee and then remit any balance remaining to the employee. If the employer does not do this they can be fined $1000 for every instance.

Them's the breaks and that's the law.

http://www.iras.gov.sg/irasHome/page03.aspx?id=544

What to do pending tax clearance

Withhold monies

* You must withhold all monies due to the non-Singapore citizen employee from the day he notifies you of his intention to cease employment or when you decide to terminate the employment or post the employee to an overseas location.
* Monies to be withheld include salary, bonus, overtime pay, leave pay, allowances, gratuities, lump sum payments, etc.
* Do not release payment to the employee until tax clearance is given or upon the expiry of 30 days after the Comptroller has been notified through the Form IR21, whichever is earlier.
* You may be held liable for the tax that is owing by the employee if you fail to comply and do not give valid reasons.

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Postby Bafana » Wed, 31 Dec 2008 6:28 pm

Tax Clearance is a !@#%$ but thems the breaks.

Have just finished up my tax and got hit hard.
Be Like Water

ydnerendy
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Postby ydnerendy » Wed, 31 Dec 2008 6:35 pm

sundaymorningstaple wrote:Every employer has to file a Tax Clearance (IR21) for departing Foreign Workers (S or EP's) for those earning in excess of 20K/p.a.. This is required by law from IRAS (Inland Revenue). Employers MUST withhold the last month salary until given tax clearance by IRAS. The employer MUST pay the taxes on behalf of the departing employee and then remit any balance remaining to the employee. If the employer does not do this they can be fined $1000 for every instance.

Them's the breaks and that's the law.

http://www.iras.gov.sg/irasHome/page03.aspx?id=544

What to do pending tax clearance

Withhold monies

* You must withhold all monies due to the non-Singapore citizen employee from the day he notifies you of his intention to cease employment or when you decide to terminate the employment or post the employee to an overseas location.
* Monies to be withheld include salary, bonus, overtime pay, leave pay, allowances, gratuities, lump sum payments, etc.
* Do not release payment to the employee until tax clearance is given or upon the expiry of 30 days after the Comptroller has been notified through the Form IR21, whichever is earlier.
* You may be held liable for the tax that is owing by the employee if you fail to comply and do not give valid reasons.




thankyou for the answer.

by the way in this link :

http://www.iras.gov.sg/irasHome/page01.aspx?id=88

there is mention about terms and conditions for the retrechment tax.
But i am little bit didn't understand.

Do i should pay the tax while my company didn't give me any retrechment benefit's and package's?

They only give me 1 month salary and they want to deduct the tax from my salary.

Can i claim for that?

Other thing is my company never mention any tax and never give me any contract agreement since i worked there for 1.5 years.

thank you if you can answer again.

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Postby sundaymorningstaple » Wed, 31 Dec 2008 7:21 pm

You weren't retrenched so nothing you read there applies to you. Generally only union workers are retrenched or it when you are given lets say half or one months salary for every year you worked for the company. That is what is considered retrenchment pay and it's handled differently. AWS or 13th month bonus is not retrenchment pay as it's part of your employment contract.

Retrenchment generally involves a large number of staff who are being made redundant due to restructuring or some such. Letting one person go is not considered retrenchment. If you have been working for 1.5 years without a contract, they YOU have a problem as you should never work for any company without a contract so you know where you stand and what your rights are. It's obviously too late now, but use is as a learning tool for the future. ALWAYS get a contract and ALWAYS get a signed original copy of the contract. Otherwise, DON'T go to work for that company because you will only get shafted at some time in the future. Also, if you don't understand the contract don't sign it until such time as you do understand it completely.

sms

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Postby ydnerendy » Wed, 31 Dec 2008 7:53 pm

sundaymorningstaple wrote:You weren't retrenched so nothing you read there applies to you. Generally only union workers are retrenched or it when you are given lets say half or one months salary for every year you worked for the company. That is what is considered retrenchment pay and it's handled differently. AWS or 13th month bonus is not retrenchment pay as it's part of your employment contract.

Retrenchment generally involves a large number of staff who are being made redundant due to restructuring or some such. Letting one person go is not considered retrenchment. If you have been working for 1.5 years without a contract, they YOU have a problem as you should never work for any company without a contract so you know where you stand and what your rights are. It's obviously too late now, but use is as a learning tool for the future. ALWAYS get a contract and ALWAYS get a signed original copy of the contract. Otherwise, DON'T go to work for that company because you will only get shafted at some time in the future. Also, if you don't understand the contract don't sign it until such time as you do understand it completely.

sms


I don't understand about this retrechment scheme because as i know in my company it's not only me who had been laid off but with another 10 employee's as well but i am just concern it seem only me who shall got the deduction for this tax while other employee's had got the salary today and mine is pending until friday because the HRD want to assume the tax.

Just wait how it goes on friday.

By the way thanks for the advise about the contract.It is a lesson for me.Since i work there i always asked for the contract and the HRD always pending until i got bored to ask at least i got the salary every month.This is my 1st company in Singapore until now and i use it as my starting point in Singapore.

Thankyou so much you always answering me for all my question's. Hope you won't be bored to answer.

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Postby ydnerendy » Wed, 31 Dec 2008 8:11 pm

Bafana wrote:Tax Clearance is a !@#%$ but thems the breaks.

Have just finished up my tax and got hit hard.


How hard it was?
I hope it's not that hard and i am still waiting too.

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Re: Got laid off and have to pay tax

Postby banker » Thu, 01 Jan 2009 1:16 am

The tax your HRD is referring to is Income Tax. If you a foreigner leaves the company (due to termination, resignation what ever), the company is liable for the employee's income tax. Generally the companies withhold 15% of 2008 pay. However, IRAS will access your actual income tax and return the remaining amount.

1) Don't doubt or argue with your company. Accept it
2) Request your company to file the IR21 as earliest as possible
3) If you intend to stay in Singapore for few weeks, make a trip to IRAS. Request IRAS officer to expedite the process.


ydnerendy wrote:I want to ask about my issue in my company.

I jost got laid off 1st week of this month and this friday my last work in this office.

i've been work in singapore for 1.6 years and before i was holding training past for 1.5 years.
My salary is 2300.
Currently i am holding EP for just one month after convert from the first pass and just now my HRD said that she has to charge the tax before give me the last salary.

My HRD never tell me about the tax and she said will give me the salary after assuming my tax.

1st time i thougt it's a tax for holding EP but when i asked my HRD she said that my Ep tax is $0.
She said that this is for tax since 1st time came in Singapore since i am still holding training pass.

1st question...Is there any such thing?because i still haven't leave the singapore and intend to work in other company as i am had application's for Ep to another company's.

2nd question...Do i have to pay this kind of tax when i haven't leave the singapore at this time and if the answer yes, is it possible if i pay the tax just by my self in another time because i need save the salary until i got another job?

if anyone know about this issue i appreciate if can answer.

thankyou,
I love Singapore

ydnerendy
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Re: Got laid off and have to pay tax

Postby ydnerendy » Thu, 01 Jan 2009 7:19 am

banker wrote:The tax your HRD is referring to is Income Tax. If you a foreigner leaves the company (due to termination, resignation what ever), the company is liable for the employee's income tax. Generally the companies withhold 15% of 2008 pay. However, IRAS will access your actual income tax and return the remaining amount.

1) Don't doubt or argue with your company. Accept it
2) Request your company to file the IR21 as earliest as possible
3) If you intend to stay in Singapore for few weeks, make a trip to IRAS. Request IRAS officer to expedite the process.


ydnerendy wrote:I want to ask about my issue in my company.

I jost got laid off 1st week of this month and this friday my last work in this office.

i've been work in singapore for 1.6 years and before i was holding training past for 1.5 years.
My salary is 2300.
Currently i am holding EP for just one month after convert from the first pass and just now my HRD said that she has to charge the tax before give me the last salary.

My HRD never tell me about the tax and she said will give me the salary after assuming my tax.

1st time i thougt it's a tax for holding EP but when i asked my HRD she said that my Ep tax is $0.
She said that this is for tax since 1st time came in Singapore since i am still holding training pass.

1st question...Is there any such thing?because i still haven't leave the singapore and intend to work in other company as i am had application's for Ep to another company's.

2nd question...Do i have to pay this kind of tax when i haven't leave the singapore at this time and if the answer yes, is it possible if i pay the tax just by my self in another time because i need save the salary until i got another job?

if anyone know about this issue i appreciate if can answer.

thankyou,


So that's mean there is two type of tax for the employee isn't.
The tax for holding EP and the tax when the employer departed the employee to Singapore.

Thank you for the answer

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Re: Got laid off and have to pay tax

Postby banker » Thu, 01 Jan 2009 12:45 pm

ydnerendy wrote:
banker wrote:The tax your HRD is referring to is Income Tax. If you a foreigner leaves the company (due to termination, resignation what ever), the company is liable for the employee's income tax. Generally the companies withhold 15% of 2008 pay. However, IRAS will access your actual income tax and return the remaining amount.

1) Don't doubt or argue with your company. Accept it
2) Request your company to file the IR21 as earliest as possible
3) If you intend to stay in Singapore for few weeks, make a trip to IRAS. Request IRAS officer to expedite the process.


ydnerendy wrote:I want to ask about my issue in my company.

I jost got laid off 1st week of this month and this friday my last work in this office.

i've been work in singapore for 1.6 years and before i was holding training past for 1.5 years.
My salary is 2300.
Currently i am holding EP for just one month after convert from the first pass and just now my HRD said that she has to charge the tax before give me the last salary.

My HRD never tell me about the tax and she said will give me the salary after assuming my tax.

1st time i thougt it's a tax for holding EP but when i asked my HRD she said that my Ep tax is $0.
She said that this is for tax since 1st time came in Singapore since i am still holding training pass.

1st question...Is there any such thing?because i still haven't leave the singapore and intend to work in other company as i am had application's for Ep to another company's.

2nd question...Do i have to pay this kind of tax when i haven't leave the singapore at this time and if the answer yes, is it possible if i pay the tax just by my self in another time because i need save the salary until i got another job?

if anyone know about this issue i appreciate if can answer.

thankyou,


So that's mean there is two type of tax for the employee isn't.
The tax for holding EP and the tax when the employer departed the employee to Singapore.

Thank you for the answer


There are no taxes for holding EP OR departing Singapore. The only tax is income tax. The income tax applies to expats on EP or PR and Singapore citizens.

If you continue to work in the same company, you will be paying 2008 income tax in April 2009. Since you are leaving the company, you have to clear it early.

Let me repeat there is no such thing as EP tax or departing tax.
I love Singapore

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Postby sundaymorningstaple » Thu, 01 Jan 2009 3:10 pm

banker just confused the issue. He just repeated what I have already told you and gave you the links for. By him repeating me, it appeared that he didn't bother to read the entire thread and therefore succeeded in confusing you again. That often happens when people don't bother to read the whole thread (or contract). Hope he doesn't conduct his banking business like that! :wink: (or maybe he did and old habit die hard - looking the the financial mess the world is in at the moment). :P

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Postby ydnerendy » Thu, 01 Jan 2009 6:35 pm

sundaymorningstaple wrote:banker just confused the issue. He just repeated what I have already told you and gave you the links for. By him repeating me, it appeared that he didn't bother to read the entire thread and therefore succeeded in confusing you again. That often happens when people don't bother to read the whole thread (or contract). Hope he doesn't conduct his banking business like that! :wink: (or maybe he did and old habit die hard - looking the the financial mess the world is in at the moment). :P


yes 1st i thought i understand then now it is make me feel that i have not understand yet.
Because refering to Banker statement that the tax is for the April 2009.This is the tax for income who holding EP and i thought this what my HRD mean to but my HRD said that this tax for me is $0 because i just holding EP for 1 month so there is no amount to charge.

Anyway my concern is not about the income tax but about the tax clearance amount and i just concern that the tax is high and can absorb all my salary which is my last salary in this company and no bonus and termination benefit.

I have $2300/month and trying to assuming the tax but don't understand how,even there is a tax calculator in the IRAS website.

Right now i am still intending to stay and working in Singapore as i had application to the MOM from other company and still waiting for the IPA.

By the way after my HRD deduct the tax from my salary do i have right to ask for the proved letter for me to keep so i have the prove that i had paid the tax?whenever it is need in the future

And do i still need to pay this kind of tax if i working in other company then i moving on to another again or it is only for one tme only?

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Postby banker » Thu, 01 Jan 2009 10:29 pm

SMS

This guy is asking about EP tax and termination tax etc. I did read the entire thread and no one mentioned the term "Income Tax".


Since there are many taxes around, I thought it is useful to for him if I clarify we are really taking about income tax.

Anyway I'm banker only in the name.
I love Singapore

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Postby sundaymorningstaple » Thu, 01 Jan 2009 11:07 pm

The only people who have to file tax clearances are those who have EP's (unless it is a PR who's giving up their residency). Therefore Tax Clearance could be conceivably called an EP tax as it's the only time HR needs to pay somebody's taxes for them. With the fractured English used here this is entirely possible and highly probable (I've got a local as my HR Exec primarily for her Chinese abilities - her English isn't that bad though). Therefore the only time they actually get involved with IRAS is with departing EP's so to them it looks like an EP tax.

It does, however, smell fishy as it would seem the HR has told him a bunch of BS about his training pass. As long as He earned less than 20K/yr during those earlier years he still would not have a tax liability and IRAS will compute this anyway once the IR21 is filed as it asks for the previous year's salary as well as the current years salary. It also asks for the date of arrival in Singapore for determining whether to tax the first year at resident rates or flat rate. (Now changed to span 2 years so even that should not be an issue - he would have used resident rates for last year as well.

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Postby ydnerendy » Fri, 02 Jan 2009 9:47 am

become more confusing :)

anyway i am still waiting for the salary.

since 1st time came to Singapore holding training pass my salary is around 27k/an.

by the way how about my question?
after my HRD deduct the tax from my salary do i have right to ask for the proved letter for me to keep so i have the prove that i had paid the tax?whenever it is need in the future

And am i still need to pay this kind of tax if i am working in other company then i am moving on to another company or got laid off like this again.Or it is only for one time only?

what i mean is the clearance tax.Not about the tax which is have to pay on April every years which is called income tax who applies for someone holding EP.
Last edited by ydnerendy on Fri, 02 Jan 2009 4:47 pm, edited 1 time in total.


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