Market Entry Guide Singapore.

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1. Introduction
2. Modes of Setting up a Business in Singapore
   1. As a new business or company
   2. As a foreign business entity
   3. Foreign Investment in Singapore
   4. Average Time (in days) Required for Setting up a Business
3. Procedures for Immigration
   1. Procedure for Obtaining Visa
   2. Procedure for Residence Permit
   3. Procedures for Work Permit
   4. Average Living Costs for Expatriates
   5. Average Rent for Office Space
4. Social Security System in Singapore
   1. Social Security Programmes in Singapore
   2. Social Security
5. Free Trade Zones (FTZs) in Singapore
   1. Introduction
   2. Advantages Offered by FTZs
   3. Facilities Available at FTZs
6. Opening a Bank Account in Singapore
   1. Overview of Retail Banking
   2. Procedure to Open a Bank Account
7. Recruitment of Local Staff
   1. Brief Overview of Labour Laws
   2. Major Recruitment Agencies and Websites
   3. Average Salary
8. Taxation
   1. Taxation in Singapore
   2. Taxes and Duties
   3. Tax Incentives
   4. Avoidance of Double Taxation Agreement
9. Appendix
10. Disclaimer

1 Introduction

Singapore is a Sovereign Republic Island city state; its legislation is based on the English Common Law. The Prime Minister is the head of the executive branch, forming the government.¹ As per the midyear estimates, Singapore had a total population of 4.9 million in 2009²; however, about 25 percent of the total population consists of foreigners. The country has four official languages - Chinese, English, Malay and Tamil. The country possesses the best road, water and air transportation system in the world.³

The country has a free market economy, and its per capita GDP (PPP) is higher than that of numerous developed countries such as the United States, Ireland, Hong Kong, the Netherlands and Canada.⁴ The economy is extremely export oriented, with its main export industries, including consumer electronics, information technology products and pharmaceuticals.⁵

The total GDP at current market prices was EUR 124,181 million in 2008. About 70 percent of the total GDP at current prices was contributed by the service industries, including transportation, wholesale and retail trade, hotels and restaurants and financial services.

The country’s Gross National Income at current prices increased 6.9 percent year-on-year and reached EUR 120,790 million in 2008.

Also, the total Official Foreign Reserves of the country reached EUR 120,769 million in 2008 and the total export value in 2008 was EUR 229,995 million. The value of the total items imported by the country in 2008 was recorded at EUR 217,515 million.

As per the World Bank report of ‘Doing Business 2009’, Singapore ranked first in the world for the ease of doing business. As per the Globalisation Index 2007, Singapore ranked first in the world for foreign trade and investment. The Global Competitiveness Index rankings of 2007–08 revealed that Singapore is also the most competitive country of Asia and the fifth most competitive nation of the world, lagging behind the US, Switzerland, Denmark and Sweden.⁶

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2 Modes of Setting up a Business in Singapore⁷

This section discusses the common investment vehicles available to foreign investors, the procedures to be followed in order to establish them and related regulations for each investment mode.

Table 1 lists the most common modes of setting up businesses by foreign investors and the legal procedures and implications involved in each process.

Table 1: Different Modes of Setting up Business in Singapore

MODES OF SETING UP A BUSINESS
As a new business or company	Sole Proprietorship Partnership Limited Liability Partnership (LLP) Limited Partnership (LP) Company
As a foreign business entity	Branch of A Foreign Company Representative Office in Singapore

Source: Enterprise One (One Network for Enterprises)

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2.1 As a new business or company

There are two general modes of establishing a business in Singapore, as a new business or company, or as a foreign business. The following discussion throws light on the five types of business structure specified under the first category.

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2.1.1 Sole Proprietorship

A sole proprietorship is the simplest form of business. The characteristics for this business structure are:

It is owned by a person or a company

It is not considered as a legal entity

Profits are taxed at a personal income tax rate

Except in some cases such as undischarged bankrupts, any person or company can register as a sole proprietorship in Singapore. In case the owner is not an “ordinary resident”8 of Singapore, he/she is supposed to appoint a local manager. All sole proprietorships must be registered with the Accounting and Corporate Regulatory Authority (ACRA).

2.1.1.1 Steps to register as a sole proprietorship⁹

To appoint a local manager, in case none of the owners registering is an ordinary resident of Singapore;

To check the availability of the business name to make sure that it is not identical to an existing entity, obscene or reserved. One can check its availability at online directory of businesses on Bizfile;

Correct Singapore Standard Industry Classification code (SSIC) is required at the time of registration. It can be searched at the ACRA website. One can also seek assistance by calling the ACRA HelpDesk at 00 65 6248 6028 between 7am and 12midnight, Mon - Sun (including public holidays);

To provide a local address for the place of business in Singapore to be approved for business use by the Urban Redevelopment Authority (URA);

To ensure that Medisave contributions are up to date with the Central Provident Fund Board (CPF Board). This can be done by using NETS/cashcard, cheque, cash, e-payment etc. The amount to be paid can be judged by logging into Central Provident Fund Board. A unique Singpass, required to login to CPF account, can be obtained online at Singpass.gov;

Lastly, Online Business Licensing Service (OBLS) can be used to collectively assess the licences and permits required to be obtained and register business. An application form from Bizfile. gov can also be downloaded to register.

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2.1.2 Partnership

A partnership refers to a business firm owned by more than one individual or company. In Singapore, a partnership cannot have more than 20 owners, and must be registered with the ACRA. The main characteristics of this business structure are:

It can have a minimum of 2 and a maximum of 20 owners

It is not a legal entity

The profits form a part of personal income of partners and are taxed accordingly

2.1.2.1 Steps to register as a partnership

The steps to register as a partnership are the same as those for a sole proprietorship (detailed in section 2.1.1). In case of a company, there must be at least one director who is above 18 years of age and is either:

a Singapore Citizen

or a Singapore Permanent Resident

or an Employment Pass holder

or an Approval-in-Principal Employment Pass holder

or a Dependent Pass holder

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2.1.3 Limited Liability Partnership (LLP)

This form of business structure was introduced in Singapore in April 2005. All LLPs must be registered with ACRA. The main characteristics for this business structure are:

It has limited liability features of companies and a rational flexibility of partnerships

It can have a minimum of two partners without any upper limit

It is a legal entity

In case of an individual partner: personal tax rates would be applicable and a corporate tax rate would be valid in case where a partner constitutes a company.

2.1.3.1 Steps to register as an LLP

The steps to register as an LLP are the same as those for a partnership (detailed in section 2.1.2).

2.1.4 Limited Partnership (LP)

A limited partnership (LP) does not have any separate legal entity. The partners who do not manage operations of an LP have limited personal liability. The main characteristics of this business structure are as follows:

The partners in an LP can be the individuals, Singapore registered companies or unregistered foreign companies.

At least two members should be present in the LP. Among the partners, there should be one general partner and one limited partner.

A general partner has unlimited personal liability and can be appointed as the manager of the partnership.

The liability of a limited partner is restricted to his/her investment in the partnership.

An LP can be formed through registration of a new LP only, and cannot be formed through converting a company, business or Limited Liability Partnership.

The partners have to pay taxes on their share of income from the LP. The individual partners pay tax at personal income tax rate while corporate partners pay tax at the corporate tax rate.

2.1.4.1 Steps to register as a LP

An LP is registered with the ACRA. The registration steps are similar to those of the sole proprietorship detailed in section 2.1.1 above.

2.1.5 Company¹⁰

A company is a business entity registered as per the Companies Act. A company has the following characteristics:

A company is a separate legal entity.

The owners of a company are its shareholders.

Each shareholder should have at least one share.

The profits of a company are taxed at corporate tax rates.

2.1.5.1 Types of Companies

Three types of companies can be incorporated in Singapore. They are briefly outlined below:

Private/public companies limited by shares

The liability of companies limited by shares is restricted to their share capital. A private company can have a maximum of 50 shareholders.

Public companies limited by guarantee

Nonprofit, religious and charitable organisations are usually formed as the public companies limited by guarantee. Such companies do not have any share capital.

Unlimited companies

Unlimited companies have no limitations on their membership or liability.

2.1.5.2 Registration of a Company

A company has to be registered with ARCA. The steps followed for registration of a company are similar to those of the sole proprietorship. The following is the procedure for registering a company:

The eligibility requirements below must be met.

• At least one of the directors in the company should be above 18 years of age and be any of the following:
  • Citizen of Singapore
  • Permanent resident of Singapore
  • Employment Pass holder
  • Approval in principal Singapore Pass holder
  • Dependent Pass holder
• The director of a company should not be convicted of dishonesty or bankrupt.
• A company should have at least one shareholder and one director. The shareholder and director can be the same person

The company name has to be decided on. The name should not be identical to any entity already established or liable to be considered as vulgar or obscene. The name should not be reserved.

• A company can check the availability of a proposed name through the online directory of ACRA, accessible on the website Bizfile - Company Name.

The company should find the right Singapore Standard Industry Classification code (SSIC) applicable as per its business activity. The SSIC code can be searched through the website of ACRA – SSIC Code.

The company should have a local address for the business place. The company can operate its business from premises approved by the Urban Redevelopment Authority.

A company has to apply for the right licence and permit. The website Oneline Business Licensing Service provides information about the right licence and permit and other related requirements to be met before registration.

The registration can be done independently or through any professional service firm. The procedure to be followed for selfregistration is provided on the website EnterpriseOne - DIY or Self Registration.

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2.2 As a foreign business entity

A foreign business entity can be set up as a branch of the foreign company or Representative office in Singapore. This procedure is outlined below.

2.2.1 Branch of a Foreign Company¹¹

Procedure for the registration of a Branch of a Foreign Company:

As per the Companies Act, the foreign company must appoint two local agents residing in Singapore. The local agents act on behalf of the company.

The company should engage a professional firm or service bureau for assistance in preparing and filing the application for registration.

The company name should be approved if it is available.

The Branch office can be registered through the website Biz File.

The applicable fees for registration formalities include the following:

• Name Approval Fee – EUR 7.2 (SGD 15)
• Registration Fee for a Foreign Company with share capital – EUR 144.6 (SGD 300)
• Registration Fee for a Foreign Company without share capital – EUR 578.4 (SGD 1,200)

A company is normally incorporated within 15 minutes of its registration. However, a longer duration of 14 days to two months may occur if the application requires approval from various referral authorities. The list of referral authorities for different business activities can be accessed through this link: ACRA – Referral Authorities Table.

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2.2.2 Representative Office of a Foreign Company (RO)¹²

A company can use its representative office (RO) for carrying out the following activities only:

Market Research

Feasibility Studies

Acting as a liaison for the parent company

If a company wishes to set up its RO for banking and insurance activities, the registration authority is the Monitory Authority of Singapore (MAS).

The following steps are required for the registration of an RO with MAS:

An application is made by the Chief Executive or equivalent position holder of the bank or its Singapore office, if operating.

The application is addressed to the following person:

• Mr Leo Mun Wai
  Executive Director
  Banking Supervision Department
  Monetary Authority of Singapore
  10 Shenton Way
  MAS Building
  Singapore 079117

The application form can be downloaded from the link MAS – Application to Set Up Representative Office.

If the company wishes to set up its RO to carry out business activities other than banking and insurance, it should complete registration through International Enterprise Singapore (IES). The following steps are required for the registration of an RO with IES¹³:

An online application is made through the website of IES.

The following documents must be submitted with the application:

• A digital copy of the parent company’s Certificate of Incorporation, in English language. If the original document is in a language other than English, an official translation of the same must be submitted.
• A digital copy of the latest audited accounts of the parent company.

If the company does not have digital copies of the required documents, the applicant can submit a hardcopy of the documents at the head office of IES.

The applicant has to pay a processing fee of EUR 96.4 (SGD200) by cheque, bank draft or credit card.

The cheque or bank draft can be mailed to the following address:

• International Enterprise Singapore
  230 Victoria Street #07-00
  Bugis Junction Office Tower
  Singapore 188024
  Attn: Off-Shore Trade Group (Representative Office)

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2.3 Foreign Investment in Singapore¹⁴

Singapore has an extremely open investment environment. The Economic Development Board of Singapore acts as an investment promoting agency that focuses on securing major investments in high-value manufacturing and service areas to replace the labour intensive activities which have moved to offshore nations.

The following are general characteristics of the foreign investment policy of the country:

The foreign investors are not bound to enter into joint ventures or surrender their managerial controls to the local people.

The local and foreign investors are subject to the same law.

The government has limited or restricted investments in some sectors.

The screening of investment proposals is done with the objective of determining the eligibility of the proposal for the incentives.

There is no restriction on the transfer or repatriation of profits or capital to overseas nations.

The restrictions on foreign investment exist for some of the sectors mentioned below:

Telecommunications – SingTel imposes certain uneconomical technical interconnection requirements, making the operations by overseas companies expensive. The companies of overseas operators face problems in accessing inter-exchange ducts. Also, the decisions made by Infocomm Development Authority and the Ministry of Information, Communication and Arts are not published in detail, which results in the lack of transparency of the rules and regulations governing the telecommunications industry.

Media – Section 44 of the Broadcasting Act restricts the foreign investor’s ownership in the companies broadcasting to the domestic market of Singapore to 49 percent or less, with some exceptions. The individuals cannot hold more than 5 percent of shares in a broadcasting company without the government’s approval.

• The Newspaper and Printing Presses Act restricts the equity share ownership by both foreign and local investors to 5 percent. The director of a Newspaper and Printing company should be a citizen of Singapore.

Banking – Legal differences exist between the foreign and Singapore banks and the kind of licences issued to the foreign banks and local banks. A foreign bank can hold three types of licences—full service, wholesale and offshore. The banks operating on offshore licence can upgrade to the wholesale licence on fulfilment of the criteria set by the Central Bank, the Monetary Authority of Singapore.

Securities and Asset Management – The government of Singapore removed restrictions on trading by the foreign-owned stockbrokers in 2002. However, foreign investment is not allowed to exceed more than 70 percent of the paid up capital of the dealers who are members of Singapore Exchange.

Legal Services – There is a restriction on foreign firms from practising Singapore law and hiring lawyers of Singapore to practise Singapore law or litigate in the Singapore courts.

Engineering and Architectural Services – Singapore removed the restrictions requiring that the chairman and two-thirds of the board of directors should be engineers, land surveyors or architects, and they should be registered with the local professional bodies.

Accounting and Tax Services – The law requires that at least one partner in the public accounting firm should live in Singapore. The public accountants who hold membership of the Institute of Certified Public Accountants of Singapore and who are registered with the Public Accountants Board can only practise in the country. However, the accountants registered with the American Institute of Certified Public Accountants are also recognised by the board.

Real Estate – As per the Residential Property Act, the foreigner can own condominiums or any unit in a building of at least six levels without prior approval of Singapore Land Authority. However, landed houses and apartments in the buildings with less than six levels can be purchased only after Singapore Land Authority’s approval.

Energy – A US company faced issues in its access bid due to delays in review of its applicant by the Energy Market Authority. No non-incumbent operator has been able to secure access to Singapore’s part of the Sumatra-Singapore pipeline.

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2.4 Average Time (in Days) Required for Setting up a Business

A number of legal formalities have to be followed before the actual setting up of a company. The formalities include registration, licensing, requirement of minimum capital, etc. Table 2 lists the data released by the World Bank related to starting a business Singapore.

Table2 : Starting a Business in Singapore

DATA RELATED TO STARTING A BUSINESS	YEAR – 2010
Rank	4 (in the world)
Procedures (number)	3
Duration	3 days
Cost (GNI per capita)	0.7
Paid in Minimum Capital (GNI per capita)	0.0

Source: The World Bank Group - Document: Doing Business 2010 Singapore

Figure 1 illustrates the obstacles inherent in starting business ventures in various countries.

 

Source: World Bank 2010 Doing Business

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3 Procedures for Immigration

The following documents are required by a person who enters Singapore:

Visa

Passport valid for at least six months

Adequate funds for the duration of stay in the country

Confirmation of the onward or return air ticket

The countries requiring a visa for entering Singapore have been divided into Assessment Level 1 and Assessment Level 2. These are shown in the following table:

Table 3: List of Countries Included in the Assessment Level 1
and Assessment Level 2

ASSESSMENT LEVEL I COUNTRIES	ASSESSMENT LEVEL II COUNTRIES
India	Afghanistan
Myanmar	Algeria
Nigeria	Bangladesh
People's Republic of China	Egypt
Armenia	Iran
Azerbaijan	Iraq
Belarus	Jordan
Georgia	Lebanon
Kazakhstan	Morocco
Moldova	Pakistan
Russia	Saudi Arabia
Tajikistan	Somalia
Turkmenistan	Sudan
Ukraine	Syria
Uzbekistan	Tunisia
	Yemen

ICA - Nationals of Assessment Level I Countries; ICA - Nationals of Assessment Level II Countries

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The list of nationals included in the Level 1 and Level 2 assessments include the holders of the following documents:

Table 4: List of Persons Included in the Assessment Level I and Assessment Level II

ASSESSMENT LEVEL I COUNTRIES	ASSESSMENT LEVEL II COUNTRIES
Holder of Hong Kong Document of Identity	Holders of Palestinian Authority Passport
Holder of Macao Special Administrative Region (MSAR) Travel Permit	Holder of Temporary Passport issued by the United Arab Emirates
-	Holder of Refugee Travel Document issued by Middle-East countries

ICA - Nationals of Assessment Level I Countries; ICA - Nationals of Assessment Level II Countries

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3.1 Procedure for Obtaining a Visa¹⁵

A person can apply for a visa online through a local contact via the website of Submission of Application for Visa Electronically (SAVE). The local contact uses a Sing Pass account for making the application.

Otherwise, the application can be made overseas through the nearest Singapore Overseas Mission.

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3.1.1 Business Visit Visa

A business visit visa is issued to a person who visits Singapore to attend business discussions or negotiations.

The following documents are required while applying for a visa for business visit:

Original form 14 A duly filled in

A recent passport size photograph must be pasted on the top right corner of the application form. The photograph must meet the following requirements:

• The photograph must be no more than three months old
• The photograph must be in colour and taken with a white background with a matt or semi-matt finish
• The applicant’s full face must be clearly visible

A copy of the applicant’s passport identity page

The passport should be valid for at least six months from the date of entering the country.

Checklist 4 must be attached to the form 14 A.

Form V39A (Letter of Introduction for Visa Application) duly filled in by the applicant:

• The letter of introduction must be issued by a local contact such as a citizen of Singapore or a permanent resident of Singapore
• If the applicant has to attend business negotiations or discussions, the form should be issued by the Singapore registered corporation
• In case a local contact cannot be found, the Embassy or Ministry of Foreign Affairs can be approached for issuing the respective form

The computerised copy of the Singapore registered company’s profile should include the names of the directors and partners in the company issued by the Instant Information Service, Accounting and Corporate Regulatory Authority no later than three months from the date of application.

3.1.2 Social Visit Visa¹⁶

A social visit visa is issued to a person who comes to the country to meet family, friends or for travelling purposes. The documents required for this visa type are similar to a business visit visa up until checklist 4. (Explained in section 3.1.1 above).

The additional documents required for application are detailed below:

The original and a copy of the local contact’s Singapore Identity Card

Form V39A (Letter of Introduction for Visa Application) duly filled in

The requirements for a person to act as a local contact are similar to those explained above in section 3.1.1.

A person belonging to the countries in Assessment Level 1 should also submit the following additional documents:¹⁷

• If the applicant is employed he should submit a letter issued by the employer granting him leave of absence. The letter should include information about the duration of employment, employee’s designation and salary.
• If the applicant is a PRC national and unemployed, they should submit a copy of their household booklet.

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3.1.3 Visa for Medical Treatment¹⁸

The documents required for obtaining a visa for medical treatment are similar to the business visit visa up until checklist 4. (Explained in section 3.1.1 above).

The additional documents required for application are detailed below:

A supporting letter issued by the hospital including the purpose of visit and the medical condition of the applicant

Form V39A (Letter of Introduction for Visa Application), duly filled in, is to be submitted if the applicant has not selected the hospital for his/her treatment in Singapore.

The requirements for a person to act as a local contact are similar to those explained above in section 3.1.1.

If a person belongs to a country included in the list of Assessment Level I countries, the following documents are required while applying for a visa for medical treatment:¹⁹

Form 14A duly filled in

One recent passport-size photograph. The photograph should show the full face of the applicant, it must not be more than three months old. The photo should be in colour and taken with a white background.

The applicant can be requested to present additional documents if necessary

Documents should be in the English language, otherwise an official translation of the same has to be submitted.

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3.1.4 Multiple Journey Visa²⁰

The multiple journey visa is suitable for the business executives who need to visit the country multiple times in a short span. The holder of a multiple journey visa can stay in the country for 14–30 days per visit, depending upon the mode of entry in the country. The visa may be issued for a period of one, two or five years as per ICA policies.

The following persons are issued a multiple journey visa:

Those who visit the country for business purpose or for making investments related to their business

Those who visit the country to explore investment or business opportunities

Candidates aspiring for Visa to enter into Singapore have to follow the following procedure:

3.1.4.1 Documents Required for Obtaining a Multiple Journey Visa

The person should obtain a Letter of Introduction (LOI) issued by a Singapore-registered company. The following documents are submitted with the LOI duly filled in Form V39A by a Singapore company and the application for visa (Form 14).

Form V52 filled in by the Singapore company and giving details of the visit

An extract issued by the Accounting and Corporate Regulatory Authority, including the business profile of the company

Photograph of the applicant

Copy of the bio-data and the last three pages of the passport, in case the application is submitted at Immigration and Checkpoints Authority in Singapore

The completed forms and above documents have to be submitted at the ICA office in Singapore or the Singapore overseas mission if the application is made abroad.

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3.1.5 Long-Term Visit Pass for Entrepreneurs²¹

The pass is suitable for the entrepreneurs aspiring to study the business opportunities in the country for a long duration. The entrepreneur is allowed to leave the country and re-enter on a Long-Term Visit Pass (LTVP).

The applicant should meet the following eligibility criteria while applying for an LTVP:

The applicant has to present the proof of a project-plan for an emerging business in Singapore or the existence of a Singapore joint-venture partner

The applicant should be a representative of a parent company that has a good track record and enjoys global presence or wants to expand globally.

The pass is granted for the maximum duration of six months

3.1.5.1 Documents Required for Obtaining a Long-Term Visit Pass

Application form – Letter of Support issued by the EDB

• The form can be downloaded from this link EDB – Application Form

A write-up with the following information

• Purpose of stay
• Area of business interest
• Preliminary business idea
• The proposed development strategy with timelines and plan of operations
• A CV informing about the applicant’s sills and experience
• Other information, if required

After receiving the Letter of Support from EDB, the applicant should submit the application for LTVP Immigration and Checkpoints Authority.

Other Visas:

The requirement for the two-week collective gratis visa issued to PRC group tours can be accessed through the website Immigration and Checkpoints Authority - PRC Group Tours.

The requirements for the visa issued to the Cruise Passengers in Singapore can be accessed through the website Immigration and Checkpoints Authority - For Cruise Passengers in Singapore.

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3.2 Procedures for Residence Permit²²

The following people are eligible for permanent residence permit in Singapore:

The spouse or unmarried children of a citizen of Singapore or Permanent resident of Singapore. The age of unmarried children should be less than 21 years

Elder (aged) parents of the citizen of Singapore

Holders of P, Q or S work pass

Investors or the Entrepreneurs

The following documents are required when applying for permanent residence in Singapore:

Documents required for the spouse or children of a Singapore citizen or Permanent resident of Singapore:

Duly filled in form 4

The list of supporting documents required can be downloaded from the Accompanying notes to Form 4

Documents required for the holders of P, Q or S work pass:

Two sets including one original and one photocopy of the duly filled in form 4

The list of supporting documents required can be downloaded from the Accompanying notes to Form 4

Procedure for the Investor or Entrepreneur:

The investor or entrepreneur can apply for permanent residence at the office of Singapore Economic Development Board (EDB) as per the provisions of the Global Investor Programme

EDB Address:
Singapore Economic Development Board
250 North Bridge Road
#28-00 Raffles City Tower
Singapore 179101
Tel : + 65 6832 6832

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3.3 Procedures for Work Permits²³

The following are the types of work permit schemes available to foreigners:

Employment Pass

Personalised Employment Pass

S Pass

Work Permit for foreign worker

Work Permit for foreign domestic worker

Others

Each of the work passes is briefly described below:

3.3.1 Employment Pass (EP)

Foreign professionals and executives willing to work in Singapore can apply for an EP. These are available for foreigners who earn a fixed monthly salary of over EUR 1,205 (SGD2, 500) and possess recognised qualifications. For details on the recognised qualifications, please refer to the website MOM - Recognised Qualifications.

The EP has three categories, namely P1, P2, and Q1. These pass types have different salary and skills requirements which are described in the table below:

Table 5: Eligibility for Different Types of Employment Pass

Type of visa	Eligibility Factor 1	Eligibility Factor 2	Eligibility Factor 3
P1	Fixed monthly salary over EUR 3,374 (SGD 7,000)	Professional Job Managerial Job Executive Job Specialist job	-
P2	Fixed monthly salary over EUR 1,687 (SGD 3,500)	Professional Job Managerial Job Executive Job Specialist job	Recognised qualifications
Q1	Fixed monthly salary over EUR 1,205 (SGD 2,500)	Recognised qualifications	Other factors such as skills and years of experience may be considered instead of recognised qualifications.

MOM – EP

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3.1.1.1 Application for EP

The application for EP can be made online through the website EP Online.

The payment for online applications can be made by Visa card, MasterCard or eNETS Debit.

A person who wants to manually apply for the EP has to fill in the EP Application Form and submit it with the administrative fee at a SingPost Office.

The form includes a list of occupations, and the form should follow the names as they are provided in this list. The list of occupations has been included in the following files:

Occupations starting from A - I List of Standard Occupation

Occupations starting from J - R List of Standard Occupation

Occupations starting from S - Z List of Standard Occupation

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3.3.2 Personalised Employment Pass (PEP)

The PEP is granted on the basis of an employee’s skill set. If the holder of a PEP leaves their current job, they can remain in Singapore for a period of up to six months to search for another job opportunity in the country. The PEP pass is valid for five years.

The following persons are eligible for a PEP:

Foreign professionals whose last drawn fixed monthly salary was not less than EUR 3,374 (SGD 7,000). The salary should pertain to a period of six months prior to the date of application.

Former P1 Pass holders living overseas

P1 Pass holders

P2 Pass holders

• The individual should have at least two years of work experience on a P Pass
• The individual’s fixed salary in the preceding year should not be less than EUR 14,460 (SGD 30,000)

Q1 Pass holders

• The individual should have at least five years of work experience on a Q1 Pass
• The individual’s fixed salary in the preceding year should not be less than EUR 14,460 (SGD 30,000)

Foreigners graduated in the institutions of higher learning of Singapore

• The individual should have at least two years of work experience on a P or Q1 Pass
• The individual’s fixed salary in the preceding year should not be less than EUR 14,460 (SGD 30,000)

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3.3.2.1 Application for PEP

The application can be made online by holders of a Singpass through the link PEP Online. The administrative fee for the pass is EUR 4.8 (SGD 10).

Foreign professionals working overseas have to submit the
form manually.

• The application is made through the Personalised Employment Pass Application Form.
• The form and administrative fee must be submitted at any SingPost Office

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3.3.3 S Pass

Foreign mid-level skilled workers earning a fixed monthly salary of more than EUR 867.6 (SGD 1,800) can apply for the S Pass. The S pass is based on the point system, with the criteria including salary level, education qualifications, skills, job type and work experience.

There is a limit on the number of S passes and Work Permit holders who can be employed by a company depending on the industry of the employer.

An employer who has not previously applied for a WP or S Pass should submit an application for its Industrial Classification.

The industry classification application can be made online through the website WP Online. The online application requires a SingPass.

The manual application for an Industry Classification can be made through Application Form for Industrial Classification.

3.3.3.1 Application for S Pass

The application for an S Pass can be made either online through EP Online or manually by filling in the S Pass application form. The application fee for an online submission can be paid by Visa, MasterCard or NETS Debit and the fee for manual application is payable at any SingPost office.

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3.3.4 Work Permit (WP)

A foreign worker who wants to work in Singapore and earns a basic monthly salary of up to EUR 867.6 (SGD 1,800) is eligible to apply for a WP.

Steps followed for the application for a WP:

The employer has to apply to the Controller of Work Permits before actually hiring the worker.

The worker should be at least 16 years of age.

The employer should meet certain obligations as described in the Conditions of Work Permits.

The employer can hire a limited number of S pass and WP holders depending on the industry classification of their business activities.

An employer who has never applied for the WPs or S Passes has to apply for the Industrial Classification prior to the applying for the WP or S Passes.

• Modes of applying for the Industry Classification:
  • An application can be made online through the SingPass Personal Access website.
  • A manual application can be made through the Application Form for Industrial Classification.

It is necessary for a company to make a contribution to the Central Provident Fund (CPF) account for its local employees for at least a month before applying for the industry classification.

The application for a work permit can be made through the following channels:

• An online application can be made through the website WP Online
• A manual application can be made by filing an application in
  the form WP Application Form

For more details regarding the cancellation and Renewal of the work permit kindly visit the website MOM Work Permit

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3.3.5 Work Permit [Foreign Domestic Worker (FDW)]

The work permit for a Foreign Domestic Worker is applied by the employer in Singapore.

The obligations of an employer hiring a FDW are explained on the website MOM – Employer’s Guidelines .

The following points are a general guideline for employers considering a FDW:²⁴

The employer cannot apply for the work permit of a person who visits Singapore on a social visit.

The worker should be from an ‘approved source country’. The approved source countries include Bangladesh, Hong Kong, India, Indonesia, the Philippines, South Korea, Sri Lanka, Taiwan, Macau, Malaysia, Myanmar, Thailand and Pakistan.

• A first-time FDW should possess at least eight years of formal education and necessary certificates to establish the fact.
• If the FDW has already worked in Singapore before, he or she should be older than 18 but younger than 50.

Table 6: Application for Work Permit (FDW)

Scheme for Application	Requirements	Mode of Application	Application
Simple Application	Employer has to apply for the Work permit of a FDW	Online	WP Online
		Manual	WP Application Form – The form can be submitted at the SingPost office.
Joint Income Scheme	The employer should combine his/ her own salary with the salary of any family member other than the spouse. The family member must reside at the same address.	Online	WP Online
		Manual	WP Application form for the Joint Income Scheme – The form can be submitted at the SingPost office.
Sponsorship Scheme	Requirements to be met before filing an application under this scheme: The employer must be at least 60 years of age. The employer should not be earning an income. The employer should not stay with the employed adults. The employer must use the income of his/her children or their spouses.	Online	WP Online
		Manual	WP Application Form for Sponsorship Scheme – The form can be submitted at the SingPost office.

MOM – Work Permit (FDW)

The table below lists the other types of work passes issued in Singapore:

Table 7: Other Work Passes

WOrk pass	Brief description
Dependent’s Pass	The dependent pass is issued to foreigners holding an Employment Pass and selected S Pass.
EntrePass	The pass is issued to foreign entrepreneurs who wish to conduct business in the country
Employment Pass Eligibility Certificate	The holder of this certificate can stay in Singapore for a period of one year while searching for a suitable job opportunity. The holder of this certificate is not eligible to work in the country
Long-Term Visit Pass	The holders of P1 or P2 passes can apply for the Long-Term Visit Passes for their family members including spouse, unmarried daughters over 21 years of age, parents and parents-in-law.
Miscellaneous Work Pass	The pass is issued to foreign nationals who work on short-term assignments in the country.
Training Employment Pass	The pass is issued to foreign nationals who attend practical training for professional, managerial, executive or specialist jobs.
Training Work Permit	The pass is issued to those foreign nationals who are unskilled and semiskilled and wish to join practical training for up to 6 months in Singapore.
Passes for Confinement Nannies	This is the pass for Malaysians who wish to work as confinement nannies.
Work Holiday Programme (WHP)	The WHP is meant for university students and recently graduated foreigners aged between 17 and 30 years, who want to work in Singapore for a duration of up to 6 months.
Work Passes for Foreign Spouses of Singapore Citizens	This pass is issued to a foreigner married to a citizen of Singapore, who wishes to work in any economic sector of Singapore.
Employment of Foreign Students	The foreign student who studied in an approved institution can work in Singapore without a Work Permit.
Employment of Long-Term Visit Pass Holders	If the holder of a Long-Term Visit Pass wants to work in Singapore, he/she should apply for a work pass.

MOM – Other Work Passes

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3.4 Average Living Costs for Expatriates

As per the latest survey conducted by the Economist Intelligence Unit (EIU) in March 2009, Singapore is the tenth most expensive city in the world and third most expensive city in Asia.²⁵

The average monthly rent for an apartment located in the middle of the city is about EUR 265.1and EUR 337.4. The rent may vary depending on the facilities provided. The monthly rental of a four bedroom house with swimming pool is about EUR 4,820 and EUR 12,050. Eating out with a large meal in a food court costs around EUR 1.4 a day per person, while supermarkets in Singapore are expensive. Clothing and jewellery are also relatively high-priced in the country. Clothing stores sell both imported and locally made apparel. The night markets and hawkers sell low-priced clothes but bulk buying is essential to receive any discounts. The monthly shopping costs of clothes and wares amount to around EUR 144.6 in Singapore.

Owning and maintaining a private vehicle can be quite costly. Transportation by public transport is a good alternative as the country has one of the best public transport networks in the world. The average bus fare per trip ranges between EUR 0.3 to EUR 0.9, with the average train ticket price is around EUR 0.5 to EUR 0.9. The cost of medical consultations in clinics is around EUR 4.8 to EUR 9.6. However, the range varies depending on the type of treatment required.²⁶

The following table gives an overview of other expenses generally incurred by expatriates:

Table 8: Cost of Living in Singapore

Expense Item	Description	COST
Education	Annual expenditure of a state-run or state-funded school	EUR 1,687 – EUR 7,230
Nightclub	Expenditure per person per visit	EUR 12
Movie Tickets	Price of movie tickets at multiplex cinemas	EUR 3.9 - EUR 4.8
Utilities bill	Monthly bill of gas, water and electricity	EUR 96.4
Wireless Internet ADSL	Charges of ADSL per month	EUR 33.7

Focus Singapore – Cost of Living in Singapore

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3.5 Average Rent for Office Space

The country’s prime rental cost in the second quarter of 2009 fell by 46.6 percent compared to the third quarter of 2008. The country is developing new office space measuring 770,000 square metres, which is expected to be completed by 2013. As a result of the increase in office space availability, the supply of office space may continue to be higher than demand in the near future.²⁷

During the global recession, A-grade office space in Singapore was available at EUR 34 per square metre per month in the last quarter of 2008.²⁸

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4 Social Security System in Singapore

4.1Social Security

The social security organisation of Singapore is the Central Provident Fund Board (CPF). The organisation covers needs in retirement, health care, family protection, asset enhancement and home ownership. Under the scheme, both the employer and employee have to make contributions to the plan.

The table below shows contributions made to the CPF for employees earning a wage of more than EUR 723 (SGD 1,500) per month and the allocation of their contribution

Percentage of Wage Contributed to the CPF and its Allocation to Different Accounts

AGE GROUP	EMPLOYER CONTRIBUTION (PERCENTAGE OF WAGE)	EMPLOYEE CONTRIBUTION (PERCENTAGE OF WAGE)	TOTAL CONTRIBUTION	ORDINARY ACCOUNT (RATIO OF PROPORTION)	SPECIAL ACCOUNT (RATIO OF PROPORTION)	MEDISAVE ACCOUNT (RATIO OF PROPORTION)
35 years and below	14.5	20	34.5	0.6667	0.1449	0.1884
Above 35 – 45 Years	14.5	20	34.5	0.6088	0.1739	0.2173
Above 45 – 50 Years	14.5	20	34.5	0.5509	0.2028	0.2463
Above 50 – 55 Years	10.5	18	28.5	0.4562	0.2456	0.2982
Above 55- 60 Years	7.5	12.5	20	0.575	0	0.425
Above 60 – 65 years	5	7.5	12.5	0.28	0	0.72
Above 65 Years	5	5	10	0.1	0	0.9

CPF – Annual Report 2008 - Overview

For details regarding the contribution made by members earning less than EUR 723 (SGD 1,500) per month, please access the website CPF – Annual Report 2008 – Annex D

Contribution by foreigners:

Foreign employees have to make contributions to the CPF only when they become permanent residents of Singapore.²⁹

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4.1.1 Overview of the CPF Accounts³⁰

The contribution made by members of CPF is allocated to three separate accounts, an Ordinary Account, Special Account and Medisave Account. The money kept in each of these accounts can be used for different purposes. The interest rate offered by these accounts is also different.

4.1.1.1 Ordinary Account

The amount kept in an ordinary account can be used for purchasing a home, education, payments of CPF insurance and other investments.

4.1.1.2 Medisave Account

The amount kept in Medisave can be used for paying hospitalisation expenses and approved medical insurance.

4.1.1.3 Special Account (SA)³¹

The special account (SA) can be used for making investments into the retirement-related financial products. People aged below 55 years make contributions to the special account. The money kept in a SA earns a higher return than the money in an ordinary account. It is also possible to transfer the contribution amount from an ordinary account to a special account provided the following conditions are satisfied:

The member should be less than 55 years of age;

The member has less than the prevailing minimum sum of EUR 48,007(SGD 99,600) in their SA, including the amount withdrawn under the CPFIS-SA.

The interest rates provided on the amount deposited in the three different accounts from January to December 2008 were:³²

Ordinary Account: 2.5 percent

Medisave Account: 4 Percent

Special and Retirement Account: 4 percent

From 1 January 2008, the interest provided on the amount kept in Medisave, SA and retirement account is pegged to the 12-month average yield earned on 10-year Singapore Government Security plus 1 percent. The government will maintain the floor rate of 4 percent until 31 December 2009.

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4.1.2 CPF Schemes³³

The table below provides information about the major schemes offered by CPF and the eligibility criteria:

Table 10: Major CPF

NAME OF THE SCHEME	ELIGIBLE PERSON	BENEFITS
CPF LIFE	The following are eligibility conditions for the CPF Life Scheme: · At least 55 years of age · Saving in the Retirement Account	Lifelong income Life Bonus
Workfare Income Supplement Scheme	The following conditions must be met by a person to become eligible for the Workfare Income Supplement Scheme: · Citizen of Singapore · More than 35 years of age as of 1st January 2010 · Living in a property with Annual Value (AV) of EUR 5,302 (SGD 11,000) or less · Earning average monthly income of less than EUR 723 (SGD 1,500) during the work period · Worked for at least 3 months in the 6-month period or for 6 months in 2009 · If the person is selfemployed, then he should have made Medisave contributions for the work performed during 2009.	Workfare Payment Please access the website CPF - Workfare to know more details about the payment scheme.

CPF – CPF Schemes and Services

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5 Free Trade Zones (FTZs) in Singapore

5.1 Introduction

Free trade zones are designated areas established under the Free Trade Zone Act. The payment of customs duties and taxes are not levied on imported goods arriving in these zones, and no taxes are charged to store goods in these zones. However, certain duties and taxes need to be paid when the imported goods leave the premises of these zones to enter into a customs territory for public consumption.

In total, there are five such zones in Singapore. They are located at:

Port of Singapore (Keppel)

Jurong Port

Sembawang Wharves

Pasir Panjang Wharves

Airport Logistics Park of Singapore (ALPS)³⁴

The FTZs are divided into two categories; four of them are placed near a sea port and cater to cargo entering Singapore through sea routes. The fifth is located at the airport; basically to look after air cargo.³⁵

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5.2 Advantages Offered by FTZs³⁶

FTZs are beneficial for all types of traders, re-exporters and transshippers. The following advantages make these zones even more lucrative:

These zones are characterised by simple and straight-forward procedures and minimal paperwork for the movement of goods.

Exporters/importers dealing in intoxicating liquor, petroleum products, tobacco products or motor vehicles (known as dutiable goods) are able to store them in FTZs. This is not applicable to goods such as liquor and cigarettes.

No customs duty or taxes are charged from the traders dealing in dutiable goods.

A Goods & Services Tax (GST) is applicable to all goods imported into Singapore, but importers dealing in goods through FTZs are exempted from GST.

The following table provides the conditions for the payment or non-payment of GST:

Table 11: Conditions for Payment or Exemption from GST

CONDITIONS FOR PAYMENT OR ExEMPTION FROM GST
Goods imported and stored in FTZ before exporting	This is known as transshipment and falls out of scope of GST.
Goods removed from FTZ into customs territory for local consumption	GST needs to be paid.
Goods used or consumed within FTZ	GST is payable if the goods supplied are consumed within the FTZ.

Inland Revenue Authority of Singapore - Transhipments and Free Trade Zones

FTZs benefit both local and foreign traders. However, the following conditions must be met by traders:

The movement of goods (imports, exports or transshipments) requires permits which are applied through TradeNet.

Foreign traders need to work in conjunction with local freight forwarders or traders to obtain the required permits.

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5.3 Facilities Available at FTZs³⁷

The following facilities are made available to traders at FTZs:

1. Depositing and storage of goods

Non-dutiable goods can be stored at these zones if they are being transhipped or re-exported. All dutiable goods can be stored except for intoxicating liquor and tobacco products, which must be stored in licensed warehouses.

2. Repacking, sorting and re-conditioning

With the prior approval/permission of Singapore Customs, activities such as re-packaging, sorting and re-conditioning of goods can be completed here. This facility particularly helps traders who want to combine or consolidate shipments from different countries to be sent to a new destination.

The application for re-packaging, re-conditioning and extraction of trade samples for assessment should be made through e-filing. This online service is available here.³⁸

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6 Opening a Bank Account in Singapore

6.1 Overview of Retail Banking

All commercial banks operating in Singapore are licensed under and governed by the Banking Act. The Monetary Authority of Singapore (MAS) is the central bank of Singapore. Its functions include, but are not limited to issuing currency, managing foreign reserves, and supervision of financial services.

The banking structure in Singapore permits banks to carry out functions other than commercial banking. This includes other business areas regulated by MAS, such as financial advisory services, insurance broking and capital market services. Commercial banks need to comply with the conditions stated in the Financial Advisers Act (FAA), Insurance Act (IA) and Securities and Futures Act (SFA) to carry out their related functions.

Commercial banks are not entitled to conduct any non-financial activity. This provision is in accordance with the amendment made to the Banking Act in 2001. Commercial banks are classified as full banks, wholesale banks or offshore banks. Full banks carry out all banking activities as prescribed in the Banking Act. Wholesale banks are similar to full banks except that they do not perform Singapore Dollar retail banking activities. Offshore banks can engage in similar types of activities as the other two, however, only for businesses transacted through their Asian Currency Units (ACUs).

Table 12 lists the major bank categories in Singapore.

Table 12: The composition of Singapore Banking Structure

TYPE OF INSTITUTION	NUMBER	NAME OF SOME MAJOR BANKS
Commercial Banks	118
Local Banks	6	Bank of Singapore LTD; DBS Bank LTD; Far Eastern Bank LTD; Islamic Bank of Asia Limited; United Overseas Bank LTD
Foreign Banks	112
Foreign Full Banks	25	ABN AMRO BANK NV; Bangkok Bank Public Company Limited; Bank OF America, National Association; Bank of India
Wholesale Banks	46	Australia & New Zealand Banking Group Limited; Banco Bilbao Vizcaya Argentaria, S.A.; Bank Julius Baer & Co. LTD.; Bank of Nova Scotia
Offshore Banks	41	Agricultural Bank OF China Limited; Arab Bank PLC; Bank Hapoalim (Switzerland) LTD; Bank OF Baroda; Bank of Communications co LTD; Bank of New York Mellon

Monetary Authority of Singapore - Number of Financial Institutions in Singapore

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6.2 Procedure to Open a Bank Account³⁹

The banks in Singapore provide various services on the corporate accounts. These services include an option of multi-currency accounts, facility of internet banking, credit cards, trade financing, freedom to transfer funds from one nation to another. Banks follow a simple procedure to open an account.

The following is the detail of requirements for opening a corporate bank account for the Singapore companies and overseas companies.

6.2.1 Procedure to Open a Corporate Bank Account of a Singapore Company

The company has to submit the following documents with the bank:

Duly filled in corporate account opening forms signed by the authorised signatories

The resolution passed by company’s Board of Directors sanctioning the opening of a bank account and the signatories to the account

One copy of the Certificate of Incorporation, certified by the company secretary or one of the directors

A copy of the company’s business profile issued by the company registrar and certified by the company secretary or one of the directors

A copy of the company’s Memorandum of Association and Article of Association certified by a director of the company or company secretary

A certified copy of the passport and residential address proof of directors, ultimate owners and signatories of the company

Other documents may be required depending upon different banks

Some banks may require a majority of the company’s directors or the account signatories present in Singapore at the time of opening a bank account and signing papers.

There may be a requirement in some banks regarding the deposit of a minimum sum at the time of opening an account.

6.2.2 Procedure to Open a Corporate Bank Account of an Overseas Company

The procedure and documents required for opening a corporate bank account of the overseas company are similar to the requirements for a Singapore company. However, the banks may practise more due diligence while opening an account of an overseas company.

The banks will require more information regarding the business activities of the company, source of funds, bank reference letters, the value of transactions, carried by the company and proof of the beneficial owners of the company.

In addition, a company will have to submit the following documents:

Certificate of Incumbency

Certificate of Good Standing of the overseas company

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6.2.3 Personal Accounts⁴⁰

The following are major personal accounts in Singapore and the documents required for opening such accounts:

6.2.3.1 Current Account

A person has to submit the following documents while applying
for the current account:

Identity card or the passport

The passport and relevant pass issued by the Immigration and Checkpoint Authority of Singapore (ICA) if the applicant is a foreigner

A bank may also require the applicant to meet an age criteria and a deposit minimum sum. For instance, DBS Bank requires the account owner not to be less than 21 years of age and the minimum initial deposit in the account should be EUR 1,446.

6.2.3.2 Saving Account

Banks offer various savings accounts; for instance, DBS bank offers Mysavings Account and Savings Plus account.

The documents required for opening a saving account are given below:

Identity card or passport

A foreign national has to present his/her passport and the pass issued by the ICA

A bank may also set other requirements such as minimum age limit and minimum initial deposit for opening a savings account

6.2.3.2 Fixed Deposit Account

The fixed deposit account allows a person to deposit an amount of money for a fixed period of time. The deposit earns a fixed interest rate for the predetermined duration.

The basic documents required for opening a fixed deposit account are similar to the documents required for a current account. Banks can set an age limit and initial deposit requirements, depending upon the scheme of fixed deposit.

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7 Recruitment of Local Staff

Singapore is home to a skilled workforce, which is proficient in English and continuously upgrades its skills through worker training and scholarship programmes.⁴¹ As per the data published by the Ministry of Manpower, Singapore, about 3 million people were employed in the country as on year-end 2008, with the highest percentage of them (about 67.3 percent) employed in the services sector, followed by 19.9 percent in the manufacturing sector.⁴²

The major sources for recruitment of local talent in Singapore include online job search services such as JobsNet; distributed CareerLink Centres operated by the Singapore Workforce Development Agency; Singapore Corporation of Rehabilitative Enterprise for recruiting ex-offenders, NTUC job link, employment agencies, job fairs, websites and local newspapers.⁴³

The key recruitment channels for hiring foreign workers include the organisation named Contact Singapore and various employment agencies. Contact Singapore promotes Singapore as a favourable place for career opportunities.⁴⁴

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7.1 Brief Overview of Labour Laws

Singapore’s labour relations legislations have been divided into eight acts—the Employment Act 1968, the Retirement Age Act 1993, the Industrial Relations Act 1960, the Trade Unions Act 1940, the Trade Disputes Act 1941, Part III of the Criminal Law (Temporary Provisions) Act, the Singapore Labour Foundation Act 1977 and the Children Development Co-Savings Act (amended on 31 October 2008).⁴⁵

The Employment Act 1968 covers major rights and obligations of the employer and the employee. The act is divided into 16 parts, each of which deals with regulations related to different aspects of employment relations.

Table 13 provides an overview of the parts included in the Employment Act and some of the constituents of each part.

Table 13: Overview of the Employment Act 1968

PART	NAME OF THE PART	MAJOR RULES COVERED UNDER THE PART
I	Preliminary	· General provisions related to the law · Definition of various terms such as employee, domestic worker
II	Contracts of service	· Contractual age · Change of employer · Termination of contract
III	Payment of salary	· Fixing the period for payment of salary · Computation of salary for incomplete month’s work · Payment of salary when the job has been terminated by the employee
IV	Rest days, hours of work and other conditions of service	· Hours of work · Annual leave · Payment of retrenchment benefit · Payment of annual wage supplements and other variables
V	Truck system	· Recovery of salary not paid in legal tender · Remuneration other than salary · Provision for shops and canteens
VI	Contractors and contracting	· Liability of the principals, contractors and subcontractors for payment of remuneration to the workmen · Provision relating to registration of contractors and subcontractors
VII	Part-time employees	· Definition of part-time employees
VIII	Domestic workers	· The authority vested in the Minister of Manpower to apply the provisions of the Employment Act to domestic workers or make modifications to the working condition requirements and other work-related aspects for domestic workers
IX	Employment of children and young persons	· Definition of a child and a young person · Restriction on the employment of children and young persons · Working conditions for the employment of children and young persons
X	Maternity protection and benefits, and childcare leaves for parents	· Length of the benefit period · Payment period · Provision for inclusion of holidays in the payment period
XI	Holiday and sick leave entitlements	· Holiday entitlement · Provision for paid sick leave
XII	Registers, returns and other documentary equirements	· Record of workmen · Returns to be furnished by the employer
XIII	Inspection and enquiry	· Powers of the Commissioner and the inspecting officers · Obligations of the inspecting Officer
XIV	General	· Method for calculating the gross and basic rates of pay for employees employed on a monthly rate or piece rates · Detention of employees
XV	Claims, complaints and investigations into offences	· Authorities vested in the Commissioner to enquire into the complaints filed · Procedure for filing claims and procedure for hearing claims
XVI	Procedures and regulations	· Right of hearing of the complainants, Onus of Proof and fine application

MOM - Employment Act

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7.3 Major Recruitment Agencies and Websites³⁰

Table 14 lists some of the recruitment agencies in Singapore and their websites.

Table 14: Major Recruitment Agencies and Websites

RECRUITMENT AGENCIES	WEBSITES
Personnel Services Pvt. Ltd.	http://www.ppsjob.com.sg/
Manpower Singapore	https://candidate.manpower.com/
Recruit Express	http://www.recruitexpress.com.sg/
Head Hunter Agencies	see websites below
JCG Search International	http://www.jcgsearch.com/
Kerry Consulting	http://www.kerryconsulting.com/
Atlantic Research Technologies L.L.C	http://www.atlanticresearch.com/regions/singapore.htm

http://www.ppsjob.com.sg/; https://candidate.manpower.com/;
http://www.recruitexpress.com.sg/; http://www.kerryconsulting.com/;
http://www.atlanticresearch.com/regions/singapore.htm;
http://www.jcgsearch.com/

The directory of employment agencies can be accessed through the link MOM _ Employment Agency Directory

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7.4 Average Salary Range

The median annual salary ranges (in 2009) in Singapore by job, employer type, industry, city and degree, as per PayScale, are presented in Tables 15 –19.

Table 15: Median Salary in Singapore by Job (2009)

JOB	mEDIAN SALARY (IN EUR)
Senior Software Engineer, Developer, Programmer	24,860
Project Manager, Information Technology	34,356
Information Technology Consultant	26,934
Software Engineer, Developer, Programmer	18,439
SAP Consultant	30,654
Regional Sales Manager	41,152
Business Development Manager	33,029

PayScale 2009

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Table 16: Median Salary in Singapore by Industry (2009)

INDUSTRY	mEDIAN SALARY (IN EUR)
Information Technology Services	26,135
Banking	30,475
Financial Services	33,747
Investment Banking	36,821
IT Consulting	27,232
Software Development	22,850
Manufacturing and Distribution	26,135

Source: Payscale, 2009

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Table 17: Median Salary in Singapore by Employer Type (2009)

EMPLOYER TYPE	mEDIAN SALARY (IN EUR)
Company	27,045
Private Practice/Firm	22,554
Other Organisations	23,152
Government – State and Local	22,961
College/University	26,933
Hospital	17,275
Contract	23,579
Non-profit Organisation	17,849
Government Federal	23,645
School or School District	17,966
Self-Employed	17,093
Foundation or Trust	20,579
Franchise	14,118
Team	18,845
Fellowship	24,353

Source: Payscale, 2009

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Table 18: Median Salary in Singapore by City (2009)

CITY	MEDIAN SALARY (IN EUR)
Singapore	26,079
Raffles Place	22,058
Kansas City	23,175
Orchard	14,496
Woodland	14,206
Central	26,935
Johor Bahru	22,219

Source: Payscale, 2009

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Table 19: Median Salary in Singapore by Degree/Major Subject (2009)

DEGREE/MAJOR SUBJECT	MEDIAN SALARY (EUR)
Master of Business Administration	48,063
Bachelor of Engineering	28,740
Bachelor of Science (BS/ BSc/SB), Computer Science (CS)	24,513
Masters of Science	29,660
Bachelor of Science (BS/SB/BSc)	28,604
Bachelor of Arts (BA/AB)	24,464

PayScale 2009

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8 Taxation

8.1 Taxation in Singapore

The Inland Revenue Authority of Singapore functions as a statutory board of the Finance Department of Singapore. The board formulates and implements taxation policies.⁴⁶

8.2 Taxes and Duties⁴⁷

Taxes and duties in Singapore are charged under the following heads:

Individual income tax

Corporate tax

Property tax

Goods and services tax (GST)

Trust (including income from estates)

Stamp duty

Clubs, trade associations, MCs and town councils

Private lottery duty

Betting and sweepstake duties

The rates of tax and duties applicable and the persons liable to
make payment under each of these heads are explained below.

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8.2.1 Individual Income Tax

8.2.1.1 Rate of Tax Applicable to a Resident Individual

The tax on income of individuals is charged at different rates depending on their residential status in Singapore. A person is treated as the resident of Singapore in the assessment year if he/she fulfils any of the following conditions:

The person is a Singaporean

The person is a permanent resident of Singapore having established a permanent home in the country

The person is a foreigner who has worked or stayed in Singapore for 183 days or more in the previous year (excluding the director of a company)

Table 20: Rates of Taxes Applicable to a Resident Individual

CHARGEABLE INCOME	TAX RATE	GROSS TAX PAYABLE - EUR (SGD)
First EUR 9,640 (First SGD 20,000) Next EUR 4,820 (Next SGD 10,000)	0 3.50	0 (0) 169 (350)
First EUR 14,460 (First SGD 30,000) Next EUR 4,820 (Next SGD 10,000)	- 5.50	169 (350) 265 (550)
First EUR 19,280 (First SGD 40,000) Next EUR 19,280 (Next SGD 40,000)	- 8.50	434(900) 1,639 (3,400)
First EUR 38,560 (First SGD 80,000) Next EUR 38,560 (Next SGD 80,000)	- 14	2,073 (4,300) 5,398 (11,200)
First EUR 77,120 (First SGD 160,000) Next EUR 77,120 (Next SGD 160,000)	- 17	7,471 (15,500) 13,110 (27,200)
First EUR 154,240 (First SGD 320,000) Above EUR 154,240 (Above SGD 320,000)	- 20	20,581 (42,700) -

IRAS – Income Tax Rates

Tax Rebate: In the assessment year 2009, the government granted 20 percent rebate up to a minimum amount of EUR 964 (SGD 2,000).

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8.2.1.2 Rate of Tax Applicable to a Non-resident Individual

If the individual is employed, he/she has to pay taxes at the rate of 15 percent or the rate applicable to the residents of Singapore whichever leads to higher tax amount.

If the individual earns income from a director’s fee, consultation fee, or any other source, then he/she has to pay taxes at the rate of 20 percent.

8.2.2 Corporate Tax

All companies whether local or foreign companies are charged at a flat rate. The rates of taxes applicable are explained in Table 2:

Table 21: Rates of Taxes Applicable to a Corporate

ASSESSMENT YEAR	TAX RATE
2010 and onwards	17
2009	18
2008	18

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8.2.3 Property Tax

The property tax is payable on immovable property. It is payable on 31st January every year. The tax rate is 10 percent per annum. If a person purchases and lives in a residential property, he/she has to pay tax at the rate of 4 percent per year.

The method of tax calculation is given below:

Tax amount = Tax rate x Annual value

8.2.4 Goods and Services Tax (GST)

GST is collected on sale or purchase of goods and services made in Singapore. However, it is not charged on selling or renting out residential properties or providing financial services.

The tax rate is 7 percent of the local sales value from July 1 onwards.

8.2.5 Estate Income Tax

The estate income tax is chargeable on two different rates of taxes applicable to the legal personal representative and beneficiaries.

The income of a legal personal representative is chargeable at the rate of 17 percent from the assessment year 2010.

Resident beneficiaries have to pay taxes at the rates as per their personal tax rate if the estate income has been distributed among them before 31st March in the year following the assessment year.

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8.2.6 Stamp Duty

Stamp duty is payable on the documents related to properties, interest in properties and shares or interest in shares.

8.2.7 Clubs, Trade Associations, MCs and Town Councils

The tax is charged on the income of clubs or similar institutions, trade associations, management corporations and town councils.

For information about the tax rate payable by clubs, trade associations, MCs and town councils, access the website IRAS - Tax Rate.

8.2.8 Private Lottery Duty

The duty is chargeable on the income from activities such as operating fruit machines, playing tombola and lucky draws.

Private lottery duty is payable at the rate of 30 percent.

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8.2.9 Betting and Sweepstake Duties

Betting and sweepstake duties are payable on the income derived from carrying out the following activities:

Totalisator or pari-mutuel betting such as horse racing

Sports betting such as football betting

Sweepstake

Other betting system held, organised, supervised or operated by an organisation exempt under the betting and sweepstake duties order

The rate of duty chargeable on betting activities excluding sweepstakes is 25 percent.

Sweepstake is chargeable at the rate of 30 percent.

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8.3 Tax Incentives

8.3.1 Tax exemption for Newly Start-up companies⁴⁸

Since 2005, a newly start-up qualifying company has been eligible for full tax exemption on its first EUR 48,200 (SGD 100,000) of the normal chargeable income for its first three assessment years.

The normal chargeable income excludes Singapore franked dividends.

From 2008, a further 50 percent exemption is provided on the next EUR 96,400 (SGD 200,000) of the normal chargeable income.

The exemption amount is explained in Table 22:

Table 22: Tax Exemption for Newly Start-up Companies

NORMAL CHARGEABLE INCOME (EUR)	RATE OF EXEMPTION	EXEMPTION AMOUNT (EUR)
First 48,200 (SGD100,000)	100	48,200 (SGD 100,000)
Next 96,400 (SGD 200,000)	50	48,200 (SGD 100,000)
Total Exemption		96,400 (SGD 200,000)

IRAS – Tax Rates and Tax Exemption Schemes

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A company that does not qualify for the tax exemption given to newly start-up companies are provided partial tax exemption as follows:

• A company is given partial tax exemption on its normal chargeable income of up to EUR 144,600 (SGD 300,000). The normal chargeable income excludes Singapore franked dividends.

The amount of tax exemption is explained in Table 23.

Table 23: Partial Tax Exemption for Companies that do Not Qualify for Tax Exemption of Newly Start-up Companies

NORMAL CHARGEABLE INCOME (EUR)	RATE OF EXEMPTION (PERCENT)	EXEMPTION AMOUNT (EUR)
First 4,820 (SGD 10,000)	75	3,615 (SGD 7,500)
Next 139,780 (SGD 290,000)	50	6,989 (SGD 145,000)
Total Exemption		73,505 (SGD 152,500)

IRAS – Tax Rates and Tax Exemption Schemes

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8.3.2.1 Conditions for a Qualifying company⁴⁹

A company will be eligible for tax exemptions from assessment year 2009, if it satisfies the following conditions:

The company should be incorporated in Singapore.

The management and control of the company should be exercised in Singapore for that assessment year.

The company should not have more than 20 shareholders in the entire basis period for that assessment year.

• All shareholders should be individuals holding shares in their own names.
• Otherwise, at least one shareholder should be an individual holding at least 10 percent of the ordinary shares of the company.

The tax exemption scheme applicable to newly start-up companies will also include companies limited by guarantee and satisfying the conditions of a qualifying company from assessment year 2010.

8.3.2 Other Tax Incentives⁵⁰

The following tax incentives are provided to foreign companies:

8.3.2.1 International Headquarters Award (IHQ)

A company that promises to exceed the minimum requirements for the Regional Headquarters Award is eligible for a concessionary tax rate of 10 percent or less. The Regional Headquarters Award is given to a company that carries out its Asia-Pacific headquarters activities out of Singapore.

The Headquarters Award Brochure can be downloaded from the link Enterprise One - Head Quarter Award Brochure.

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8.3.2.2 Regional Headquarters Award (RHQ)

The RHQ award is given to a company that conducts its Asia-Pacific headquarters activities out of Singapore. A company that enjoys the RHQ status has to pay corporate taxes at the concessionary rate of 15 percent.

Other tax incentives are presented in Table 24.

Table 24: List of Activities Eligible for Tax Incentives

ACTIVITY	SCHEME
Goods Traders and Manufacturers	Excise Factory Scheme
	Industrial Exemption Factory Scheme
	Licensed Warehouse Scheme
	Major Exporter Scheme (MES)
	Temporary Import Scheme (TIS)
	Zero GST Warehouse Scheme
Product Development and Innovation	Development & Expansion Incentive (DEI)
	Investment Allowance (IA)
	Investment Allowance (IA) Scheme For Flagship Concepts
	R&D Tax Allowance (RDA) Scheme
	Liberalised Research And Development (R&D) Tax Deductions
	Pioneer Incentive (PC-M or PC-S)
Tourism Promotion	Concessionary Tax Rate For Approved Mega Events
	Double Tax Deduction (DTD) For Inbound Tourism Promotion
	Double Tax Deduction (DTD) For Local Trade Exhibitions
Venture Abroad	Double Deduction (DD) for Overseas Investment Development Expenditure
	Double Tax Deduction (DTD) for Market Development, Master Franchising and Master Intellectual Property Licensing

Source: Deloitte

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8.4 Avoidance of Double Taxation Agreement⁵¹

Singapore has signed the Avoidance of Double Taxation Agreement with numerous countries.

The agreements signed by the country have been divided into the following three categories:

Comprehensive Avoidance of Double Taxation Agreements:
This agreement covers all types of income.

Limited Treaties: This agreement covers only income from shipping activities and/or income from air transportation activities.

Treaties that are Signed but not Ratified: This includes treaties that have not been ratified, and therefore, do not have the force of law. The treaties include both limited treaties and comprehensive agreements.

Table 25 represents the list of countries which have signed the treaty with Singapore.

Table 25: List of Nations which have Signed the Avoidance of Double Taxation Treaties

COMPREHENSIVE AVOIDANCE OF DOUBLE TAXATION AGREEMENTS	LIMITED TREATIES	TREATIES THAT ARE SIGNED BUT NOT RATIFIED
Australia	Bahrain	Australia
Austria	Chile	Austria
Bahrain	Hong Kong	Bahrain
Bangladesh	Oman	Belgium
Belgium	Saudi Arabia	China
Brunei	UAE	Denmark
Bulgaria	USA	Libya
Canada	-	Mexico
China	-	Morocco
Cyprus	-	Netherlands
Czech Republic	-	New Zealand
Denmark	-	Norway
Egypt	-	Qatar
Estonia	-	Ukraine
Fiji	-	United Kingdom

IRAS – Tax Treaties

The list of countries which have signed Comprehensive Avoidance of Double Taxation Agreement with Singapore is not exhaustive, visit the website IRAS – Tax Treaties for more details.

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9 Appendix

TYPE OF ORGANISATION	ADDRESS	CONTACTS	WEBSITE
MINISTRIES, AGENCIES aND SERVICES IN INDONESIA
Singapore Government Online Portal	Not Applicable	Not Applicable	www.diplomatie.be/singapore/
Ministry of Manpower	Ministry of Manpower 18 Havelock Road Singapore 059764	Email: NA Tel: + 65 6438 5122	http://www.mom.gov.sg/
Inland Revenue Authority of Singapore	Inland Revenue Authority of Singapore 55 Newton Road Revenue House Singapore 307987 (Opposite Novena MRT Station)	Email: NA Tel: +65 6356 8622	http://www.iras.gov.sg/
Ministry of Finance	Ministry of Finance 100 High Street #06-03 The Treasury Singapore 179434	Email: mof_qsm@mof.gov.sg Tel: +65 6226 0806	http://www.mof.gov.sg/
Ministry of Trade and Industry	Ministry of Trade & Industry 100 High Street #09-01 The Treasury Singapore 179434	Email: mti_email@mti.gov.sg Tel: +65 6225 9911	http://www.mti.gov.sg/
Ministry of Foreign Affairs	Ministry of Foreign Affairs Tanglin, Singapore 248163	Email: mfa@mfa.gov.sg Tel: + 65 6379 8000	http://www.mfa.gov.sg/
Monetary Authority of Singapore	Monetary Authority of Singapore 10 Shenton Way MAS Building Singapore 079117	Email: webmaster@mas.gov.sg Tel: + 65 6225 5577	http://www.mas.gov.sg/
Association of Banks in Singapore	The Association of Banks in Singapore 10 Shenton Way #12-08 MAS Building Singapore 079117	Email: banks@abs.org.sg Tel: + 65 6224 4300	http://www.abs.org.sg/
Embassy of Luxembourg in Thailand (also covering Singapore)	Q House Lumpini 17thFloor 1 South Sathorn Road Tungmahamek, Sathorn Bangkok 10120 Thailand	Email: bangkok.amb@mae. etat.lu Tel: +66 2677 7360 Fax: +66 2677 7364
Singapore Embassy in Brussels	198 Avenue Franklin Roosevelt 1050 Brussels	Email: singemb_bru@sgmfa.gov.sg Tel: +32 2 660 2979	www.mfa.gov.sg/brussels/
Embassy of Belgium in Singapore	8 Shenton Way 14-01 Temasek Tower Singapore 068811	Email: NA Tel: +65 6220 7677	www.diplomatie.be/singapore/

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10 Disclaimer

The Government of the Grand Duchy of Luxembourg declines all responsibility regarding the use of information featured in this document. The contents are provided for information purposes only. They contain information which is not necessarily complete, exhaustive, precise or up to date. In the event of discrepancies between the texts of this publication and the original documents, the original documents as officially published shall apply. This publication may refer to external sites over which the Government of the Grand Duchy of Luxembourg has no control and for which it declines all responsibility.

February 2010

 

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