Marzuna Employer of Record (EOR) solutions can simplify the process of expanding your business in Singapore. Singapore’s robust economic environment, favorable tax rates, and highly skilled workforce make it an attractive destination for international investors. For entrepreneurs looking to expand their global footprint, Singapore often stands out as the perfect choice. With our EOR services, you can conduct business in Singapore without the need to establish a separate legal entity.
Navigating the intricacies of local rules and regulations when hiring overseas staff can be a complex and time-consuming endeavor. Our EOR solutions firm offers specialized services to address your human resources needs, streamlining the process. We take care of onboarding, taxes, and payroll for your Singaporean employees while ensuring strict compliance with all relevant laws and regulations. As a reliable and trusted provider of EOR solutions in Singapore, we can assist your company in achieving success.
Singapore is a profitable location to grow your business because of its business-friendly climate. Businesses who want to expand in Singapore must have a thorough understanding of Singaporean labour rules. With a thorough grasp of Singapore’s employment laws, you can easily adhere to the rules and hire employees.
The main tenets of Singapore’s Employment Act, 1968 are given in the following table.
| The Employment act of 1968 | The Employment Act of Singapore lays out the rules and regulations that companies must abide by when hiring workers, creating the legal foundation for employment relationships in the nation. With the exception of three groups namely Seafarers, domestic helpers, and government employees, this comprehensive regulation is applicable to all employees, both domestic and international.
The distinctive characteristics of these professions and the various legal and regulatory regimes that control them are reflected in these exclusions. The Employment Act contributes to the fair and equal treatment of all workers in Singapore by outlining specific standards for employers’ and employees’ rights and obligations in different industries. |
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| Coverage of the Employment Act | Full-time, part-time, temporary, and under-contract employees are all covered under the Employment Act. Employees who work fewer than 35 hours per week are considered part-timers. | ||||||||||||||||||
| Working-age | In Singapore, you can hire anyone who is 17 years old or older. Retirement begins at age 62. Up to the age of 65, Singaporeans who are citizens or permanent residents can continue working. | ||||||||||||||||||
| Salary | The employee’s wage must be paid by the employer within seven days of the due date. | ||||||||||||||||||
| Paid Leave | After working for an employer for three months, an employee is eligible for paid time off. The number of paid yearly leaves is based on the length of service for the employee. the organisation.
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| Public holidays | Employees in Singapore are entitled to 11 public holidays each year, according to the Employment Act. An employee who works on a holiday should be compensated with extra pay or time off. | ||||||||||||||||||
| Working hours | 44 hours per week are the statutory working hours in Singapore. | ||||||||||||||||||
| Overtime payment | An employee who works overtime is entitled to compensation equal to 1.5 times their hourly wage.. | ||||||||||||||||||
| Medical leave | After working for a company for three months, an employee is qualified to request compensated hospitalized and outpatient sick time. An employee is entitled to up to 60 days of paid hospitalization leave, which includes 14 days of paid outpatient sick leave, and up to 14 days of paid outpatient sick leave. If an employee has worked for six months, they are eligible for their full entitlement. | ||||||||||||||||||
| Maternity leave | In Singapore, expectant moms are permitted to take maternity leave. The length of the maternity leave is determined by the child’s nationality. The mother is entitled to 16 weeks of maternity leave if the kid is a citizen of Singapore. Other times, working women can request a 12-week maternity leave from their employer under the terms of the Employment Act, provided they have worked for the company for three months. | ||||||||||||||||||
| Leave expiry | Leaves that are not used by an employee during a year are forfeited at the end of the year and cannot be carried over. | ||||||||||||||||||
| Leave cash out | At the moment of service termination, an employee is entitled to collect the accrued leaves in cash. | ||||||||||||||||||
| Employee health benefits | The majority of firms in Singapore offer health insurance to their employees, even though it is not required by law. Performance is improved and staff motivation is maintained. | ||||||||||||||||||
| Confidentiality of employees | According to Singapore’s Personal Data Protection Act, an employer is not permitted to utilise an employee’s personal information without that person’s knowledge and consent. |
Businesses have the flexibility to choose between recruiting full-time staff or independent contractors based on their specific requirements. In Singapore, the terms of engagement between an employer and an employee are documented in an employment contract, a mandatory requirement that delineates the roles and responsibilities of both parties. Here are the key distinctions between full-time employees and independent contractors:
To effectively manage ongoing tasks that require continuous commitment, businesses should consider hiring full-time personnel. For specialized projects that demand immediate attention, contractors or freelancers may be the preferred choice. We assist businesses in determining the optimal mix of full-time and contract workers, taking into account their unique organizational requirements. Our goal is to ensure your business complies with Singapore’s labor laws and the Employment Contract Law. Partner with us to learn more and expand your company’s reach and impact.
Companies without a legal presence in Singapore may encounter considerable difficulties when trying to hire local workers. To prevent any legal complications while recruiting, it is essential to have a thorough awareness of Singapore’s employment laws.
Fortunately, Singapore has a large number of job-hunting websites, including jobstreet ,gumtree , beamstart , careerbuilder , and freelancezone . These platforms provide you access to creative and competent people that want to work for your company. Although it may take reviewing a large number of applications to find the best fit, these platforms are advantageous as they help you save time and money when searching for the right candidates.
However, using these platforms to hire people can still be a difficult process. This is where we come in to make things easier. We may create an employment contract that abides with local regulations by comprehending your organisation’s particular requirements, required qualifications, duties, length of service, and remuneration. The new employee may then be added to the payroll, and we can handle payroll management and monthly paystub preparation.
As part of our strategy, we also give each customer a personal account manager who is in charge of keeping track of all the employee information and paystubs, ensuring that everything goes smoothly and effectively. With our help, businesses may confidently increase their staff in Singapore while concentrating on their main business activities.
Employee probation in Singapore might last anywhere between three and six months depending on the business. Once the probationary period is over, an employee is considered to be a permanent member of the company.
| Termination | The conditions of the employment contract may allow for the termination of an employee. If there is a good reason to terminate an employee’s employment, you may do so after providing them notice. |
| Notice period | In Singapore, companies are required to give their workers enough notice before terminating their job. The employer must follow the notice period rules outlined in the Employment Act if the notice term is not included in the employment contract.
The Employment Act states that the notice time varies depending on how long the individual has been employed. For instance, workers with less than two weeks of service are entitled to one day’s notice. Employees with a notice period of 26 weeks to two years are entitled to one week, while those with a notice period of two years to five years are entitled to two weeks. Four weeks’ notice is required if an employee has worked for the company for more than five years. It’s crucial for employers to be aware of these rules and make sure they give their workers enough notice before terminating their job. This helps to preserve a pleasant work atmosphere, safeguard the rights of the employee, and stay clear of any potential legal problems. |
Given the significant risks involved for employers, termination of employment in Singapore should be handled with the utmost care. Getting the support of a reputable EOR solutions provider in Singapore might help you avoid any more legal issues. When it comes to probation and employee termination, we provide comprehensive advice and assistance.
We take a client-centric approach while serving our many different clients, providing end-to-end EOR solutions. The likelihood of expanding your firm internationally has grown as a result of the integration of many economies. You may grow your business operations with the aid of an EOR service company.
| Duration of service | The minimum duration is three months. |
| Taxes applied to invoices | Singaporean firms are subject to a 7% goods and services tax (GST), whereas overseas corporations are exempt. |
| Acceptable currency | US Dollars (USD), Euros (EUR), or Pound Sterling (GBP) are accepted in Singapore. |
| Required documents | Singapore needs a number of essential paperwork before hiring workers, and the criteria for local residents and foreigners differ.
Personal information, a copy of their passport, bank information, a job description, and a copy of their National Registration Identity Card (NRIC) for permanent residents are among the essential papers for Singaporeans. The same documents required for Singaporean citizens, such as personal information, a job description, a copy of their passport and ID, and bank information, must also be provided by expatriates, along with additional documents like educational and technical credentials, a Curriculum Vitae (CV), photographs, police verification, and results of medical exams. |
| Employment Pass | An employment pass is required of all foreign workers in Singapore making SGD 3,300 or more per month. The sponsoring employer in Singapore is responsible for sponsoring this visa. It has a two-year expiration date and a three-year renewal option. |
| Entrepreneur Pass | The EntrePass is intended for business people who want to launch a new firm in Singapore. Your business has to be a private limited company with a paid-up capital of at least $50,000 SGD. Your line of work shouldn’t be forbidden in Singapore, and the government must approve it. The applicant must hold 30% of the company’s entire share capital. |
| Personalized Employment Pass | For high-earning foreign employees or Employment Pass holders, there is the Personalized Employment Pass. If you are a foreign professional, your monthly salary should be SGD 18,000 or more, and if you already possess an EP, your salary should be SGD 12,000 or more. With this visa, you are able to change jobs inside Singapore. It has a three-year expiration date but cannot be extended. The employee should not begin a business or work as a freelancer while on this visa. A sponsored EP holder is not eligible to apply for this visa, and they must make at least SGD 144,000 annually to maintain their pass. |
| S Pass | This pass is only for mid-level employees. It is sponsored by a Singapore-registered employer. More than 20% of a company’s staff cannot be S Pass holders. This pass has a two-year expiration date and can be renewed. For a worker to qualify for this pass, their monthly salary must be at least SGD 2,200. |
We sponsor the work permits that the workers in Singapore need in our capacity as an EOR. Without a job offer, we set up Singapore work permits for foreigners. The procedure of processing work permits takes seven to fourteen days. An in-principle approval (IPA) letter for the employee is obtained for our local entity’s application for the work permit. With this letter, the employee is allowed to enter Singapore. We request a pass for the worker. To obtain their pass, the employee must register their fingerprints and a photo with the Employment Pass Service Centre (EPSC). The pass can be renewed after its initial year of use.
| sponsorship | We can sponsor the Work Permit. |
| Processing time | The processing time is 14 days. |
| Process of Work Permit |
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| Submission of passport | The passport of an employee is presented. |
| Validity | The employment permit can be renewed after its first year of validity.. |
| Work Permit criteria | The employee must have a salary of SGD 3,600 per month or more. |
| Business Visa cost | A Business Visa costs $400. |
| Processing time for Business Visa | A Business Visa takes five to 10 days to be processed. |
| Switching from Work Permit to Business Visa | The transition from a work permit to a business visa is not permitted for employees. |
Adhering to the Singaporean government’s regulations on payroll and taxation is paramount for corporate organizations seeking to expand their operations in the country. Failing to comply with these laws can result in penalties and legal complications that could tarnish a company’s reputation and hinder its growth prospects.
To mitigate these risks, many businesses opt to partner with a Singapore-based Employer of Record (EOR) solutions provider. These firms offer comprehensive payroll outsourcing services that encompass all facets of the process, including salary calculations, tax computations, and timely submission of reports to the relevant authorities.
By outsourcing their payroll systems to an EOR solutions provider, companies can ensure full compliance with Singapore’s employee tax laws. This approach proves both practical and cost-effective, relieving the business from the need to maintain an in-house payroll department or hire additional personnel.
In summary, collaborating with an EOR solutions provider like Marzuna can assist companies in navigating Singapore’s intricate payroll and taxation regulations. This, in turn, allows them to focus on their core business operations and work towards achieving their growth objectives in the country.
The tax structure of Singapore is as follows:
| Tax Explanation | Employer Taxation |
|---|---|
| Payroll tax | There is no payroll tax to be paid in Singapore. |
| Corporate income tax | Corporate income is taxed at 17%. |
| Financial year | The financial year ends on December 31. |
| Tax documents | Form IR8A is the primary tax document. |
| Withholding tax | Employers must record employee earnings but are not compelled to deduct income tax from employee pay. Every year, tax returns must be submitted by April 15 (or April 18 if they are electronically filed). A Notice of Assessment will be given upon the submission of the return. 30 days after receiving the Notice of Assessment, payment is required. |
| Social Security contribution by employers | Employers are required to contribute 17% of their salary to the Central Provident Fund (CPF). |
| Medical insurance | Medical insurance is not mandatory. |
| Tax | Explanation | ||||||||||||||||||||||
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| Income tax | Income tax rates are as follows.
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| Social Security contributions by employees | Employees are required to contribute 20% of their salary. | ||||||||||||||||||||||
| Sales tax | Except for exports, financial services, the sale or rental of residential properties, and the import and supply of precious metals, the government imposes GST on all goods and services. | ||||||||||||||||||||||
| Tax returns | Individuals are required to file tax returns. |
Singapore’s favorable business environment has long been a top choice for entrepreneurs seeking to expand their ventures. With advanced infrastructure, a highly educated workforce, and a strategic location, Singapore offers a wealth of opportunities for development and growth.
When considering launching a business in Singapore, entrepreneurs have three options to explore: opening a branch office, creating a subsidiary company, or establishing a representative office. Of these options, creating a subsidiary company is often the preferred choice, as it grants greater independence and control to the company’s management.
Setting up a subsidiary business in Singapore involves various procedures, including registering the company name, submitting necessary documents to the government, appointing directors and a company secretary as representatives, obtaining a company seal, opening a bank account, and arranging employee insurance through the CPF.
While this process may appear daunting, partnering with a professional services company specializing in Singapore company incorporation can simplify the journey. These firms provide a comprehensive solution, handling all the paperwork and legal requirements on your behalf, freeing your time and resources to focus on exploring business prospects in Singapore.
If you are contemplating the establishment of a subsidiary business in Singapore, don’t hesitate to reach out to us. We offer a comprehensive solution that caters to all your HR needs, making it effortless for you to navigate Singapore’s challenging business landscape and succeed in your endeavors.
