Tax clearance matter

[bluebell007]

Hi, anyone know about the tax clearance detail because i will leaving my current job and boss told me that I may need to pay the tax for government.

I'm work permit holder and my commerce date is from july 2011 until march 2012. Will i need to pay the tax if i've plan to get a new job in singapore?
Is that any period that i must get a new job?

Please advice.

[sundaymorningstaple]

IF you are a Work Permit holder (not an Employment Pass holder) AND your income is less than 20K during the calendar year. If your income for the previous year (2011) was more than 20K then your employer will have to file tax clearance (IR-21) and pay your taxes and deduct those taxes from your final salary. By law, they must keep your final salary until such time as either tax clearance has been paid or it is determined that tax clearance is not necessary. (If you earned less than 20K in 2011 or 2012 the employer is not even required to file the IR-21).

http://www.iras.gov.sg/irasHome/page04. ... t_required

[zzm9980]

Quick question:

Does PEP holder also have pay held for tax clearance?

edit: SMS's link makes it sound like I will have to, but just checking..

[sundaymorningstaple]

Yes, you employer would be required to file the tax clearance one month before you draw your final salary. The key here is that Tax Clearance is required by ALL Foreigners when leaving their employment (if you have a FIN number you would need to file, if you have an NRIC you don't).

[zzm9980]

So since I've never filed taxes in Singapore yet, IRAS is unaware of my deductions and such. If they over-withhold, do I receive a refund, or is it credited? I imagine since they're going to withhold the whole thing now, and not give me the option to Gyro over 12 months?

[sundaymorningstaple]

If you work for say 3 employers in one year, especially if you work project work, each has to file a tax clearance. As your IRAS Tax Number is you FIN number, it never changes.

Therefore, when your 2nd employer files their tax clearance it will only have the dates of employment and wages drawn by that employer. IRAS will automatically pull up your FIN number and will see there is already income reported and taxes paid. They will recompute by combining incomes and offsetting with taxes paid on the first go. Same goes for the third employer.

If at the end of the year, assuming you have paid some taxes up front, you will either pay the additional taxes or get a refund for overpaid taxes. This CAN happen if, say you first job in Singapore was in the tax year in question and over 60 days (without any days in the previous year) but less than 183 days. Then you would get hit with the flat rate tax of 15% of salary. If you second job lasted the rest of the year or even enough to get past the 183 day mark, then resident rates would apply. It's possibly that, depending on how much you earn, that you could get a refund due to high non-resident rates paid on the 1st job, or you taxes will be substantially reduced when offset with the amount paid at 15%. The tax clearance has to be paid "by the employer" out of your salary. Then any balance is paid to you. The first one can hurt if you don't make the 183 requirement and are hit with the flat rate of 15%.

One other thing. The 183 days are computed from the day you arrive in Singapore, NOT the day you started employment. People often forget or overlook that. HTH

[JR8]

I imagine since they're going to withhold the whole thing now, and not give me the option to Gyro over 12 months?

I thought a Gyro was a NYC street-vendor kebab!

[zzm9980]

I imagine since they're going to withhold the whole thing now, and not give me the option to Gyro over 12 months?

I thought a Gyro was a NYC street-vendor kebab!

Gyros, and I think more popular in Chicago where I'm from God I miss those. Damn you to hell for reminding me.

[zzm9980]

If you work for say 3 employers in one year, especially if you work project work, each has to file a tax clearance. As your IRAS Tax Number is you FIN number, it never changes.

Therefore, when your 2nd employer files their tax clearance it will only have the dates of employment and wages drawn by that employer. IRAS will automatically pull up your FIN number and will see there is already income reported and taxes paid. They will recompute by combining incomes and offsetting with taxes paid on the first go. Same goes for the third employer.

If at the end of the year, assuming you have paid some taxes up front, you will either pay the additional taxes or get a refund for overpaid taxes. This CAN happen if, say you first job in Singapore was in the tax year in question and over 60 days (without any days in the previous year) but less than 183 days. Then you would get hit with the flat rate tax of 15% of salary. If you second job lasted the rest of the year or even enough to get past the 183 day mark, then resident rates would apply. It's possibly that, depending on how much you earn, that you could get a refund due to high non-resident rates paid on the 1st job, or you taxes will be substantially reduced when offset with the amount paid at 15%. The tax clearance has to be paid "by the employer" out of your salary. Then any balance is paid to you. The first one can hurt if you don't make the 183 requirement and are hit with the flat rate of 15%.

One other thing. The 183 days are computed from the day you arrive in Singapore, NOT the day you started employment. People often forget or overlook that. HTH

So in my case, I'm over 183 days, but just barely not for Tax Year 2011. But, I was on a continues P1 that whole year, and since last month, switched to PEP. Will they give me the 15% rate, or the lower rate? Also, I have a wife and kid, and since I haven't done taxs yet, IRAS has never really been told by me. That's small potatos anyway, I guess I'll find out soon enough

Thanks

[the lynx]

*ahem*

G-I-R-O

[sundaymorningstaple]

Agreed. Giro.

Lynx, for a moment there while trying to read your post the song Y....M....C....A..... kept getting in the way!

[the lynx]

Agreed. Giro.

Lynx, for a moment there while trying to read your post the song Y....M....C....A..... kept getting in the way!

Oh crap, what have you done? Now it is playing in my head ALSO!

[the lynx]

On similar note, do remember that if you arrange for GIRO for tax payment and then you resign before it kicks in or halfway through, the GIRO arrangement will be terminated without notice (because I didn't receive anything from IRAS) and you will need to pay up the remaining amount (had to call IRAS to get the final figure).

[kapadiabs]

Hi,

Can anyone guide me on tax clearance matter? I have changed my employment in Jul-2013. I worked for my ex-employer for 150 Days and i received notice of assessment based on 15% tax rate. I am still in Singapore and now working for another employer. Do i still need to pay Tax amount mentioned in assessment or can i pay it together for ex-employer & new employer.

one more query is there any provision to receive refund on tax clearance and how do i get it. Kindly advise on same,

Regards,

[AngMoG]

Hi,

Can anyone guide me on tax clearance matter? I have changed my employment in Jul-2013. I worked for my ex-employer for 150 Days and i received notice of assessment based on 15% tax rate. I am still in Singapore and now working for another employer. Do i still need to pay Tax amount mentioned in assessment or can i pay it together for ex-employer & new employer.

one more query is there any provision to receive refund on tax clearance and how do i get it. Kindly advise on same,

Regards,

You will have to pay, and it is deducted from your last salary, in my experience. I.e., you don't have a choice. When you do your next tax filing (hopefully next year, regularly), the tax paid will be taken into account, and you would pay the remainder or get refund, as the case may be, then.