Employer of Record Singapore
Infotree Global Solutions help companies to achieve potential growth globally by providing global payroll and Employer of record services in the country where it wants to expand. Setting up a business in a foreign country like Singapore can be challenging but with Infotree global you don’t have to worry about a thing. As your Singapore Employer of record, we take responsibility for all formal employment duties so that you can focus on your business development without being concerned about the legal hassles.
Table of Contents
• Hiring in Singapore
• Employment Compliance
• Employee Entitlements
• Payroll in Singapore
• Payroll Tax in Singapore
• Visa and Work Permits in Singapore
• Benefits of Singapore Employer of Record
• Why Infotree Global Solutions?
Hiring in Singapore
Hiring and expanding a business in a totally new and fast-paced country requires pre-determination, planning, and understanding a list of labor laws and regulations. Without mapping employment laws organizing new workers in the country can bring up unnecessary issues and clashes. Every company that looks for a bright prospect in Singapore should be aware of all legal requirements including hiring, labor law, and payroll management. Hence, it is not only important to get through the intricacies of Singapore’s law but abiding by them is equally mandatory. An employer of record Singapore ensures that every employment treaty fulfills the designated requirements abiding by the labor laws.
In Singapore, labor unions are identified under the Singapore Labor Law which is reviewed as a means of the employees unifying to protect their common employment rights. When it comes to negotiating terms of an employment contract with an employee for overseas hiring, an employer of record Singapore helps you to consider the standard benefits.
The Employment Act outlines employment compliance that covers working hours, days of rest, leaves, and holidays. Here are a few compliance regulations that can be considered for your Singapore business:
• In Singapore, an employee is required to work 8 hours per day, and before joining he/she has to abide by the norms laid out by the Employment Act. Hence, the employee cannot cross an average of 44 working hours per week.
• Unless mentioned for any particular reason, an employee cannot work for more than 72 overtime hours.
• Except as laid out in the employee contract, employees are permitted 1 unpaid rest day per week which is usually a Sunday.
• Under the Employment Act, workers are given paid leave if they have rendered their services exceeding 3 months. The yearly leave entitlement depends on the years of service with an employer, beginning with 7 days of paid leave for one year of service.
• The employer can not deduct more than 50% of the total payable salary in any month except under certain circumstances (like absence from duty, recovery of loan or overpaid salary, etc.). At the termination of the contract, the total deductions may exceed 50% of the final payment.
The Singapore Employment Act rules out common statutory employment rights for workers that are covered under the Employment Act. The framework rule applies to all employees working in Singapore. Employee benefits are often known as perks or fringes. Employee benefit comprises annual leave, sick leave, maternity leave, bonus or incentives, transportation, healthcare, retirement gift, and several allowances.
• Compensation: The employee’s compensation purely depends on the position and skills shown. However, 13th Month Payment is a common practice in Singapore (Not compulsory), which is commonly known as an Annual Bonus that equals 1 month’s pay.
• Annual Leaves: A worker’s annual leave entitlement depends on the number of years of service with his/her employer. If the employee is covered by the Employment Act and has served the employer for a period of not less than 3 months, in addition to the rest days, he or she qualifies for at least seven days of paid annual leave after completing a year of service. For the first year, it begins with 7 days, and with each year passing, the number of days increases until the 8th year and after the 8th year, a worker is entitled of getting at least 14 days’ leave.
• Sick Leave: If the employee has worked for roughly 6 months for the employer, the employee is entitled to 14 days of sick leave per year. If the employee has worked for 5 months, he/she is entitled to 11 days of sick leave per year and if the employee has worked for at least 3 months, he/she qualifies for 5 days of sick leave per year.
• Maternity Leaves: Working mothers, qualify for a paid maternity leave of a minimum of 12 weeks and 16 weeks if the child will be a Singaporean citizen. Under the Employment Act, a working mother should work for an employer for around 3 uninterrupted months before the birth of the child. The mother should notify her employer at least one month in advance before taking leaves to avail of benefits.
• Probation Period: As a common practice, employees are asked to serve a probation period of 3-6 months. The probation period is usually reflected by a shorter termination notice period.
Payroll in Singapore
As a promising and profitable market, Singapore is the perfect location for your business growth. Before hiring employees, it is vital for everyone to be aware of local labor laws and payroll ordinances. Being the most developed economy in the world, Singapore also represents business markets for talented and professional employees.
Establishing payroll in Singapore takes shape when the allotment of a first employee takes place. In order to deepen its business roots, the company needs to show itself as an employer and fulfill the norms of an employee with visible and authentic benefits.
The payroll setup in Singapore also indicates:
• Giving out timely paychecks;
• Registering non-Singaporean workers for all mandatory service roles;
• Registration of funds and other contributions as an employer and employee;
• Managing accurate employee records (their work contracts etc).
Payroll administration usually depends on the size of the company and basically managed by the HR Department. They ensure all payroll documentation is done and processed correctly. Singapore’s Employment Act specifies that when an employee receives his/her salary, it refers to a reward for the work activity carried out for the company’s benefit. Apart from the salary, employees are also entitled to other benefits like Overtime or bonus payments, Annual bonuses, Reimbursements for certain types of expenses, Incentives, and Other types of allowances.
Payroll Tax in Singapore
Payroll and taxation depend upon hiring local and foreign employees. For an international company that needs to abide by tax laws in Singapore, the main concerns are Individual Income Tax (IIT) for employees, social security expense, payroll tax, employee compensation insurance, withholding & business tax, and permanent establishment concerns. Singapore follows a progressive residential tax which lies between 0% to 22% depending upon individual income. Individuals are liable to pay taxes on the income they earned. Individuals staying for less than 183 days in the tax year is being considered non-residents and fall under different tax slabs.
• There is an exemption in tax if an employee is in Singapore for less than 60 days. This clause is not applicable to directors, public entertainers, or exercising a profession in Singapore.
• Staying in Singapore for 61-182 days in a year falls under tax liability and will be taxed on all income earned. In this case, the employment income is taxed at 15% or the progressive residential tax rate yielding a high tax amount.
Resident and Non-resident companies doing business in Singapore are liable to tax on their in-house income as well as on foreign income sources. However, non-residents can withhold taxes on specified income. There is a flat 17% tax on corporate income. Qualifying startups are eligible for partial tax exemption and a three-year start-up tax exemption.
Central Provident Fund (CPF) is Singapore’s national pension scheme. Singapore citizens and permanent residents are liable to contribute towards CPF. Employers contribute 17% and employees contribute 20% of their monthly wages.
Visa and Work Permits in Singapore
Working in Singapore requires valid work permits and appropriate visas as implemented by immigration laws. For companies starting and planning to set up businesses in Singapore for the first time, an employee’s work permit can only be issued by a national establishment. Arranging the right visas for immigrants is not that difficult. Singapore is a good ground for trade and business and hence, a few procedures will validate your stay and work. To meet all these requirements at ease, Infotree Global Solutions is the ideal choice to aid workers with the needed permits.
Benefits of Singapore Employer of Record
To simplify your expansion process let Infotree Global assist you to deal with all the complexities. Be it hiring employees or distributing payroll or taking care of expenses, we are there to assist you at every step. Partner with us and start your global business without worries.
• Market Access
Relying on the professional expertise of an Employer of Record is the best way to enter an unknown market quickly. By using EOR services, an international organization can avail the expertise of a Singapore employee to work for its company. Besides quick access to the Singapore market, the employer of record also enables the client to ease off worries related to payroll and HR.
• In Country Laws
It is hard to ignore the importance of regulations and compliance in a foreign country. If you are operating a business in China, you need to be well aware of the payroll and taxation rules. With Singapore Employer of Record services, a company can hire a foreign individual or local employees and deal with the complexities of the country’s rules. Be it income tax, social security contribution, expanse management, withholding charges, or business tax, an EOR or PEO company takes care of it all with total compliance.
• Diverse Solutions
No matter whether you already have a company in an international location or you are going to establish one, an employer of record can help you significantly. The EOR Company can hire staff on your behalf without having the need of setting up a subsidiary in Singapore. If your firm is already operating, using EOR for managing payroll tasks can be a great idea as it can present an effective solution to tax and accounting responsibilities in the country.
Why Infotree Global Solutions?
Are you looking for a professional and efficient solution to hire employees in Singapore and see your business touch new heights in the international market? Associating with Infotree Global Solutions offers the right direction and aid to expand your trade and business in Singapore without worries. Our in-country experts are on their toes to boost your business by providing Singapore employer of record services.
As your trusted and friendly company, we become your backbone in driving your investment forward, whether short or long-term projects. We are experts in handling several challenges and complexities by offering you experience when you hire employees without establishing an office.
If you need a professional employer organization in Singapore, look no further and contact us for hiring and payroll services.