- Contributions, statutory requirements, and mandatory levies must be taken into account. Apart from the standard Central Provident Fund (CPF) contributions, employers are mandated to contribute to the following monthly:
- Ethnic funds aimed at helping vulnerable people in their ethnic communities such as ECF, CDAC, SINDA, and MVMF
- Skill Development Levy, which makes the company eligible for training grants should it wish to train its employees in the future
- CPF levies for National Servicemen regardless of whether they are routinely sent for training.
- A levy for each foreign employee who possesses an S Pass Work Permit.
- There are strict requirements for statutory reporting.
The IRAS has directed that from 2017, all employers that have received a notice to electronically submit their employment income or employers that have at least 10 workers must electronically submit the complete income information of all their employees before March 1 every year.
IR21 forms for tax clearance must also be filed by employers with foreign employees not later than a month before they begin a posting abroad, resign or no longer be under the employment of the company, or be away from Singapore for more than three months.
IR21 forms are not, however, the only important part of Singapore taxation. Singapore taxes, which include income tax, corporate tax, and several others, can be somewhat complex to handle. This is where we at Paul Hype Page & Co come in. Our tax experts will help you solve any problems you may have which are related to tax. We will work with you to make payment of your taxes a problem-free experience.
In conclusion, an efficient payroll management system is one that is maintained and updated promptly, disburses wages and salaries punctually, and processes data accurately. Aside from helping the employer abide by the Employment Act and other applicable labour laws, employees will also benefit from a system where their pay and benefits are accorded to them when they are due.
Once the business starts to grow in terms of both financial might and number of employees, the business owner’s payroll management will begin to require a more advanced approach. This means that more attention and effort will be needed to adequately manage the business. Those who own or run a small or medium enterprise (SME) in Singapore which employs 25 staff members or fewer may discover that they are better off completely outsourcing their payroll management processes to a separate provider instead trying to form or manage an in-house team. Not only is this bound to be less stressful and time-consuming, but it is also likely that an independent payroll service provider would do a better job at a lower cost.
Frequently Asked Questions
- Are payslips mandatory in Singapore?
Yes. Starting from April 1, 2016, all employers in Singapore are mandated under the Employment Act to issue payslips to their employees monthly.
- How late can employers pay their employees?
An employer must not pay an employee later than seven days after the end of the normal salary period. For overtime payments, the employer must not pay the employee later than 14 days after the last salary period.
- What information must be on a payslip?
The Employment Act stipulates that a payslip must include the following:
- Date of salary payment
- Basic salary and allowances
- Overtime pay (where applicable)
- Salary period
- Any deductions, levies, or fees charged