How do I open a restaurant in Singapore? Presenting the PayrollHero Knowledge Kit!

Posted on July 3, 2015 by Pragya Gupta

The PayrollHero blog aims to be the knowledge repository for any restaurant owner or retailer in Southeast Asia. We have built our database with things you need to know while doing business in Singapore.

With that in mind, we have been working on a little project. Presenting the PayrollHero Knowledge Kit!

Download now… Free!
This starter kit was put together to give you high level information about Singapore, share some thoughts from restaurant owners, and present relevant statistics from our market research.

The information here includes research that will help you open a restaurant in Singapore or expand into the country.

We talk about what CPF contributions are with information about the different Ethnic Funds that require contributions.The pages are linked to relevant tax forms and websites that offer more detailed information if you want it.
There is an industry overview and analysis on the latest consumption trends in the country. We give you a salary table to refer to for your Human Resources (HR) team in Singapore.
We also give you practical write-ups on how to get an import license, food hygiene requirements and the best internet service provider for your restaurants.

But we don’t want to give you simple hard facts that you could just Google anyway. The Knowledge Kit has a wealth of information in the form of personal stories and experiences in these countries. We interviewed the president of SaladStop!, Mr. Adrien Desbaillets. He gave advice on how he chooses locations in Singapore among other practical nuggets of information. We see it as a way to help the community because there is no better way to learn than from people who have gone through the same roadblocks as your are facing right now.

We hope this information is useful to you. We would love to hear back from you with what you think about the Knowledge Kit, how we can make things better and how you use this Kit for your own research into the restaurant industry.

Lastly, we are releasing more of these for the retail industry. Watch out for more information about these industries and countries. We have also created a Knowledge Kit for the Philippines.

So go ahead and click on the image above to access the Knowledge Kit. Let us know what you think. And good luck with your new business!

Continue reading →

Special Employment Credits in Singapore

Posted on June 18, 2015 by Pragya Gupta

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The Special Employment Credit was introduced in 2011 in order to provide tax credits for employers who employ low-wage Singaporean senior citizens. The time period in which the SEC is implemented is between January 1, 2012 and December 31, 2016. The last SEC payout will be on March 2017.

There are three main criteria in order to apply for the SEC. The employee must be:

a Singaporean citizen
aged over 50
earning less that $4000 a month

In the year 2015, the Government decided to increase credit rates in order for companies to cope with the increase in CPF contributions. Credit offered by the government is 8.5% of the employee’s monthly wages for employees aged between 50 and 65. For employees over 65 years of age, the credit is 11.5% of monthly wages. These rates apply till December 31, 2015. The schedule for credit is given below:

SEC for the month ($) for employers who hire Singaporeans
Income of employee/month ($)	between ages 50 and 65	over age 65
500.00	42.50	57.50
1000.00	85.00	115.00
1500.00	127.50	172.50
2000.00	170.00	230.00
2500.00	212.50	287.50
3000.00	255.00	345.00
3250.00	191.25	258.75
3500.00	127.50	172.50
3750.00	63.75	86.25
>= 4000	0.00	0.00

The rates for 2016 have not been announced. The Singapore government has not specified whether these rates will remain or be reverted back to the old credit rates.

SEC Payments

SEC payments are made on a retrospective basis. For the months between January and June, SEC payments will be made in September. For months between July and December, SEC payments are made the following March. A company will qualify for SEC payments only after the necessary CPF contributions have been made. To check the contribution schedule for CPF and for more details on CPF payments, check out our blog post. Payments are made via GIRO. For companies without GIRO, a cheque will be sent. An important point to note that SEC is taxable.

To find out the absolute value of credit that your company will receive, you can click on the SEC calculator here. For more details on SEC, you can find FAQs here.

Singapore Corporate Taxes 102: Auto Inclusion Scheme

Posted on June 4, 2015 by Pragya Gupta

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Our Singapore Corporate Tax lessons are back! (I know what you’re thinking… nothing says exciting like taxes). This time we’ll be talking about how employers in Singapore should handle tax forms for their employees. The IRAS is trying to digitize the entire system by introducing the Auto Inclusion Scheme this year and linking it to CPF contributions. In short, filing tax returns is going to be a smoother, more integrated process.

Under the Income Tax Act, there are four forms that employers should be aware of:

Form IR8A: This is to declare income of all employees
Appendix 8A: This form should be completes if the employee is provided with benefits-in-kind unless these benefits are exempted from Income Tax
Appendix 8B: If the employee has benefited from any Share Ownership Plans, then this needs to be completed
Form IR 8S: Must be completed if excess CPF contributions are made by the employer.

Explanatory notes on each form are here. Income tax returns must be filed for the following people:

Full time resident employees
Part time resident employees
Non-resident employees
Company director (including a non-resident director)
Pensioner and
Employees who have left the organisation within the financial year

For your reference, here are the tax rates for different income brackets:

Taxable Income Bracket	Total tax on income below bracket	Tax rate on income in bracket
0-20,000	0	0
20,001-30,000	0	2
30,001-40,000	200	3.5
40,001-80,000	550	7
80,001-120,000	3,350	11.5
120,001-160,000	7,950	15
160,001-200,000	13,950	17
200,001-320,000	20,750	18
>320,001	42,350	20

The Auto Inclusion Scheme is a system for recording employee income and tax related information for companies with 12 or more employees for the entire year, ending 31 December 2014. Companies have to submit employee information to IRAS electronically by March 1st of every year, starting from 2015. This way, companies do not need to distribute hard copies of the above forms for employees to file their income tax returns.

If employers use payroll software to generate payroll, then the software can be used to submit files to AIS using another (free) software provided by the IRAS called the Validation and Submission Application. The payroll software should meet the IRAS file format specifications in order to submit forms. The Validation and Submission Application software can be downloaded here.

Once every employee’s details are filled in through AIS, companies should inform their employees to file their tax returns through the myTaxPortal. Employees no longer need to fill in their income and details from the four forms above because the AIS system already has it stored.

Employers who have fewer than 12 employees are also encouraged to use the AIS by filling out this form and emailing it to ais@iras.gov.sg. After submitting the form, companies will also have to go through a trial exercise before joining the AIS.

The AIS system can be linked to CPF Data in order to fill up Form IR 8S easily. The system makes for smooth functionality across the IRAS and CPF platforms. To sign up for the AIS and CPF Data Link-up Service from 2016, this application form must be filled. For existing AIS members who want to use the CPF Data Link-Up Service, this application form must be filled.

Hope this helps! If you want to know how to pay up CPF contributions, we’ve got you covered. More on Tax Clearance and CPF contributions later.

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

The Employer’s Guide to Singapore Work Visas

Posted on May 19, 2015 by

This video provides an introduction to hiring foreign workers in Singapore- types of visas available to the employee according to skill level, application criteria and levies due to the employer. More information is available on the Ministry of Manpower website

After you have incorporated your business in Singapore, you will need to hire employees, both local or foreign to work for your company. If you are employing non-resident employees in Singapore, as an employer you have to make sure that they hold a valid work pass (also known as work visa).

Professional Work Visa

Pass type	Who is it for
Employment Pass	For foreign professionals, managers and executives. Candidates need to earn at least S$3,300 a month and have acceptable qualifications.
EntrePass	For eligible foreign entrepreneurs wanting to start and operate a new business in Singapore.
Personalised Employment Pass	For high-earning existing Employment Pass holders or overseas foreign professionals. The PEP offers greater flexibility than an Employment Pass.

 Skilled or Semi- Skilled Workers

Pass type	Who is it for
S Pass	For mid-level skilled staff. Candidates need to earn at least S$2,200 a month and meet the assessment criteria.
Work Permit for foreign worker	For semi-skilled foreign workers in the construction, manufacturing, marine, process or services sector.

The Foreign Worker Levy

singapore work passes It is important to note that Singapore companies are required to pay Foreign Worker Levy (FWL) for the Work Pass and S Pass holders. This levy is imposed by the Singapore Government to regulate foreign workers numbers in the country.

The amount of levy due to the employer is determined by the sector the company belongs to and the educational level and skills of the employees. Employing workers with relevant qualifications and skill-based test certificates will count towards your skilled workers, which will entitle you to a concession in the worker’s levy.

Look at this example on the FWL scheme for manufacturing and service sectors.

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PayrollHero is live in Singapore. We are completely localized to Singapore’s itemized payroll requirement. We are able to effectively compute the Inland Revenue Authority of Singapore (IRAS) taxes on employee remuneration, CPF employer contributions and deductions, bonuses, contributions to community funds (MDMF, SINDA, CDAC), Foreign Worker Levy and others- for your business in 5 Minutes!

Find out how PayrollHero can provide you the solution you need to optimise your payroll process. Write to us!

Pass type

Who is it for