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IRAS, 183days, double tax agreement

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MomRazz
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IRAS, 183days, double tax agreement

Postby MomRazz » Sat, 13 Jun 2009 12:28 pm

dear all.

as explained on the iras website (http://www.iras.gov.sg/irasHome/page01.aspx?id=88) foraigners who stay less then 183days/year in singapore pay 15% tax. foraigners who stay 183days/year or more pay resident-rate.

what i can not find on the website is information about the double tax agreements (dta). in my opinion/understanding: if the home country and singapore have a dta, then foraigners who stay less then 183days/year do not pay any tax in singapore at all. because they pay all taxes in thier home country.

can anybody confirm this? can anybody send me a link where this (or a other regulation) is defined clearly?

thanks a lot. this would help me a lot.

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Postby jpatokal » Sat, 13 Jun 2009 3:58 pm

As a rule, if you're paying tax in another country, that income is not taxable in Singapore -- but that's because the income is considered to be in that other country, not in Singapore. 183 days or whatnot is irrelevant.
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Postby sundaymorningstaple » Sat, 13 Jun 2009 4:23 pm

Unless you happen to be a US citizen. Then the US will tax you on your world wide income no matter where you earn it, spend it, or live. However, it is somewhat mitigated by the Earned Income Abroad Exclusion (2555/2555-EZ) and/or Income Tax Credit Form (1116). Depending on how low your salary & benefits are you could find yourself with no US tax liability and only a small Singapore tax bill. Or if you are one of the guys that are now in the eyes of the new "Czar" of the US Gov't you could still have a hefty US tax bill as well as a fairly large (not by US standards though) tax bill in Singapore as well.

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Postby MomRazz » Sat, 13 Jun 2009 5:09 pm

jpatokal wrote:As a rule, if you're paying tax in another country, that income is not taxable in Singapore -- but that's because the income is considered to be in that other country, not in Singapore. 183 days or whatnot is irrelevant.


hi guys

thanks for your answers. well, i'm not from the usa, so this is not so relevant for me. but the 183-regulation in my opinion is relevant for 2 things:

1) how many % tax must be paid (15% flat or flexi)? but this is also not further relevant for my question.

2) do i have to pay in singapore or not?
what i saw so far is, that if there is a double tax agreement, then no tax at all must be paid in singapore, if the stay is less then 183 days/year. the tax for the whole annual income will be paid in the home country. this is what my home country goverment is telling me. but i'd like to have this confirmed by singapore goverment or by someone who knows. thanks guys.

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Postby MomRazz » Sun, 14 Jun 2009 10:59 am

looks like i finally found what i was looking for...

tax exemption can be claimed in case of dta.

here the link in case anybody else looks for the same thing:

http://www.iras.gov.sg/irasHome/page_ektid1192.aspx

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Postby Nath21 » Wed, 17 Jun 2009 12:20 pm

MomRazz wrote:
jpatokal wrote:As a rule, if you're paying tax in another country, that income is not taxable in Singapore -- but that's because the income is considered to be in that other country, not in Singapore. 183 days or whatnot is irrelevant.


hi guys

thanks for your answers. well, i'm not from the usa, so this is not so relevant for me. but the 183-regulation in my opinion is relevant for 2 things:

1) how many % tax must be paid (15% flat or flexi)? but this is also not further relevant for my question.

2) do i have to pay in singapore or not?
what i saw so far is, that if there is a double tax agreement, then no tax at all must be paid in singapore, if the stay is less then 183 days/year. the tax for the whole annual income will be paid in the home country. this is what my home country goverment is telling me. but i'd like to have this confirmed by singapore goverment or by someone who knows. thanks guys.


Im from OZ and tax residents are taxed on worldwide income. If you are overseas for 183 days you may qualify for non resident status in OZ and reisident status in Singapore if you are here for 183 days but this is not the only test as many people seem to think.

Double tax arrangement work where you are a resident in your home country but work in singapore. Therfore you will get a tax exmption for how much singapore tax you pay in your home country.

Another example is where you are clssified in your home country as resident but work in Singapore for 183 days and qualify for resident status in Singapore. So effectively you have two tax resident status. You will pay less tax in singapore because they classify you as tax resident but you will still be taxed on worldwide income in your home country and get a credit for the tax you paid i n Singapore. Top up tax will be paid in your home country.

People generally conufse tax resident status with resident status, are not aware they can be classified tax resident in both countries and make the mistake that the 183 day rule is the only rule relating to tax residency.

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Postby revhappy » Fri, 17 Jul 2009 7:48 am

Thank god India does tax its citizens on worldwide Income :D
If you are more than 6 months in India only then you have to pay tax on foreign income.
The DDTA treaty will then kick in which lets you subtract the amount of tax that you have already paid in foreign country.

@MomRazz: One more thing that you can do is, once you complete 183 days in Singapore in the following year you could claim for a tax refund


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