Withholding tax is a tax on payments made to non-residents including employees, business partners and overseas agents. Here is a quick overview of withholding tax and how it affects your business.
A non-resident is liable to pay income tax on Singapore-sourced income. Under the law, a person has a legal obligation to withhold a percentage of the payment, when he makes payments of a specified nature under the Singapore Income Tax Act, to a non-resident.
When you make payments of a specified nature to a non-resident, you must withhold a certain percentage of that payment as “withholding tax”. What Types Of Payments Are Subject To Withholding Tax?
Types of payment include:
Section 45, 45A, 45B & 45D
How are the Singapore Withholding Tax Rates?
It depends on the type of payment you are making.
Note: Where a double tax agreement is applicable, the rates specified in the agreements of the respective countries would apply.