Singapore is a city that’s particularly famous for having a very low personal income tax. Compared to many Western countries, Singapore is considered a tax haven. Singapore does not have any extra taxes on capital gain or on foreign investments and this can represent a very powerful bonus for investors.
The IRAS or Inland Revenue Authority of Singapore is responsible for maintaining the tax system in Singapore. Their policies are extremely well documented on their website and if you plan on operating a business or working in Singapore it’s a good idea to understand the tax system first.
If you are living for at least 183 days and earning an income in Singapore, you will be required to pay taxes. You need to have at least 61 total working days in the country and you could be taxed at the 15% rate or progressive rate depending on your income.
If you spend 60 days or less in Singapore all of your income will be exempt from taxes. Living in Singapore and receiving an income from sources abroad also ensures that you don’t have any taxes on that income. It is also necessary for every citizen to understand how to transfer money abroad with fewer fees and in a short time.
Singapore residents do pay property tax at a rate that applies to the gross annual value of a property. They also have a good and services tax of 7% on most purchases.
The lack of taxation in capital gains taxes ensures that investments in real estate can be easily bought and sold without extensive consequences in the Singapore tax system. This can be extremely beneficial for developers and real estate moguls throughout the area. If a person continues to invest their income in real estate or assets throughout Singapore, they can be rewarded with a break on taxes and a relatively low personal income tax rate.