Employer of Record in Singapore

Employer of Record (EOR) solutions might make it simpler to expand your business in Singapore. Singapore’s excellent economic climate, low tax rates, and talented workforce make it a desirable location for international investors. Singapore is frequently the ideal place for business owners wishing to grow internationally. You won’t need to create a different legal company in order to conduct business in Singapore if you use our EOR services.

When it comes to comprehending local rules and regulations, hiring staff abroad may be a difficult and time-consuming procedure. For your human resources requirements, our EOR solutions firm offers specialised services that streamline the process. Your Singaporean workers’ onboarding, taxes, and payroll are handled by us, and we strictly adhere to all applicable rules and regulations. We can assist your company in succeeding as a dependable and respected provider of EOR solutions in Singapore.

Summary of Singapore

• Population: 5.7 million people (2019 estimate)
• Languages: English, Malay, Mandarin, and Tamil
• National language: Malay
• GDP: $600 billion (2021 estimate)
• Currency: Singapore Dollar

Employment Landscape in Singapore

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.
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. Number of paid leaves Number of years worked 7 days 1 8 days 2 9 days 3 10 days 4 11 days 5 12 days 6 13 days 7 14 days 8
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.

Contractors Vs. Full-time Employees

Depending on their needs, businesses might choose to recruit full-time staff or contractors. The conditions of the relationship between an employer and an employee are outlined in an employment contract in Singapore. In Singapore, having an employment agreement is mandatory since it outlines the responsibilities of both the employer and the employee. The following are the key differences between a full-time employee and an independent contractor.

A full-time worker receives a monthly salary. A contractor is a temporary employee who receives a one-time payment or commission in exchange for their services.

Full-time employees are completely under the authority of their employers, who can order them to work as needed to meet corporate objectives. Independent contractors, on the other hand, exercise their judgement when working alone.

For its full-time employees, a company is required to make contributions to the Singapore Central Provident Fund (SCPF). Monthly contributions to the SCPF are made by the company and the employees. This perk is not available to independent contractors.

Personal costs cannot be subtracted from an employee’s income for tax purposes; the employee’s total income is subject to taxation. Independent contractors, on the other hand, would subtract their business expenditures from their revenue and determine their tax obligation. All of the benefits mentioned by the Employment Act are due to full-time employees. Benefits offered to employees are not available to contractors.

For ongoing tasks that are essential over time, businesses should recruit full-time personnel. For specialised tasks that are needed immediately, contractors or freelancers should be employed. We assist businesses in determining the ideal ratio of full-time and contract workers while taking into account their various organisational needs. We make sure that your business abides by labour laws and the Employment Contract Law of Singapore. Join hands with us to learn more and expand the scope and influence of your company.

Recruitment in Singapore

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.

Probation & Termination

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.

EOR Solution

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.

Employer of Record Service Terms in Singapore

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.

Types of Visas in Singapore

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.

Work Permits

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	We submit an Employment Pass application on behalf of an employee. The Ministry of Labor receives a letter from IPA. Upon presentation of the IPA letter, the employee is granted entry into Singapore. The employee then provides EPSC with their biometric data. The pass card is given to the employee. The worker may begin employment in Singapore.
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.

Payroll & Taxes in Singapore

Following the government-set payroll and taxes laws is crucial for corporate organisations wishing to develop operations in Singapore. The business’s reputation and expansion opportunities might be harmed by penalties and legal problems if these laws are not followed.

Many businesses decide to collaborate with a Singapore-based Employer of Record (EOR) solutions provider in order to avoid these problems. These firms offer thorough payroll outsourcing services that cover every aspect of the process, from figuring salaries and taxes to submitting reports to the authorities.

Businesses may make sure they are completely compliant with Singapore’s tax laws on employees by outsourcing their payroll system to an EOR solutions provider. This strategy is both practical and economical because it frees the business from having to have a payroll department on staff or recruit more workers.

Overall, working with an EOR solutions provider may assist firms in navigating Singapore’s payroll and taxes regulations, allowing them to concentrate on their core business operations and meet their growth targets in the nation.

Employer Taxation

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.

Employee Taxation

Tax	Explanation
Income tax	Income tax rates are as follows. Gross total income Tax rate (%) 0–30,000 2 30,001–40,000 3.5 40,001–80,000 7 80,001–120,000 11.5 120,001–160,000 15 160,001–200,000 18 200,001–240,000 19 240,001–280,000 19.5 280,001–320,000 20 320,001+ 22
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.

Due to its welcoming business climate, Singapore has been a popular choice for entrepreneurs looking to grow their businesses. Singapore has a wealth of development and expansion options due to its advanced infrastructure, highly educated workforce, and advantageous location.

There are three options to think about if you want to launch a business in Singapore: opening a branch office, a subsidiary company, or a representative office. The most widely used of these is frequently to establish a subsidiary company since it gives the manager more freedom and control over the firm.

There are numerous procedures that must be performed in order to create a subsidiary business in Singapore. These include registering your company name, submitting different documents to the government, appointing directors and a company secretary as representatives, getting a company seal, opening a bank account, and setting up employee insurance through the CPF.

While this process might seem difficult, working with a professional services company that focuses on Singapore company incorporation can make it less difficult. These businesses offer a one-stop shop for all your paperwork and legalities, freeing up your time and resources so you can concentrate on looking into business prospects in Singapore.

Please get in touch with us if you’re thinking about establishing a subsidiary business in Singapore. We offer a comprehensive solution that satisfies all of your HR needs and makes it simple for you to successfully negotiate Singapore’s challenging business environment.