How to run payroll in Singapore

The Singapore payroll cycle follows a monthly schedule. Most companies process payments on the last working day of each month, though some prefer the 25th.

Singapore's Employment Act doesn't specify exact payment timing, but requires that salaries be paid at least once per month. The key requirement is consistency - whatever schedule you establish must be maintained.

Payment timing requirements:

• Monthly payments are standard practice
• Payment must occur within 7 days of the end of each salary period
• For employees earning above S$4,500 monthly, payment timing is more flexible but should align with employment contracts

13th month bonus

Singapore doesn't mandate a 13th month payment, but it's become standard practice across most industries. Around 85% of companies provide this annual bonus.

Typical 13th month structure:

• Usually paid in December before Chinese New Year
• Calculated as one month's basic salary
• Pro-rated for employees who joined mid-year
• Subject to standard income tax and CPF contributions

Some companies split the payment, giving half in June and half in December to help with cash flow management.

Holiday and vacation pay

Annual leave is paid at the employee's regular rate during the leave period. There's no separate "holiday pay" calculation - employees simply continue receiving their normal salary while on approved leave.

Leave payment rules:

• Annual leave is paid in advance with regular salary
• Unused leave must be paid out upon termination at the current salary rate
• Public holiday pay is mandatory for all employees, calculated as one day's salary

For employees who work on public holidays, they're entitled to either double pay or a replacement day off plus normal pay.

Payment methods

Bank transfers are the dominant payment method in Singapore, used by over 95% of employers. Cash payments are still legal but increasingly rare and impractical for record-keeping.

Electronic payment requirements:

• Most banks support same-day transfers if processed before 3 PM
• Employee bank accounts must be with Singapore-licensed banks
• International wire transfers are possible but involve additional fees and delays

Companies must maintain detailed payment records regardless of method, including transfer confirmations and any fees deducted.

Payslip requirements

Singapore requires detailed payslips for all employees, whether delivered electronically or on paper. The payslip must be provided within 3 working days of salary payment.

Mandatory payslip information:

• Employee's full name and NRIC/work permit number
• Employer's name and address
• Pay period dates
• Basic salary, overtime, and allowances breakdown
• CPF contributions (employee and employer portions)
• Income tax deductions
• Any other deductions with clear descriptions
• Net pay amount

Electronic payslips are widely accepted and preferred by most companies. If using electronic delivery, ensure employees can easily access and download their payslips. Some companies use employee self-service portals, while others email secure PDF files.

The payslip can be in English or any of Singapore's official languages, but English is standard practice for international companies.

Income tax in Singapore ranges from 0% to 24%, with the top rate kicking in at S$320,000 for 2026.

Singapore operates a progressive tax system that's relatively straightforward compared to other jurisdictions. The good news? There's a generous tax-free threshold, and rates remain competitive for attracting international talent.

Income tax brackets

Singapore's 2026 tax rates apply to annual chargeable income after deductions and reliefs:

Annual Income (S$)	Tax Rate	Tax on Band
S$0 - S$20,000	0%	S$0
S$20,001 - S$30,000	2%	Up to S$200
S$30,001 - S$40,000	3.5%	Up to S$350
S$40,001 - S$80,000	7%	Up to S$2,800
S$80,001 - S$120,000	11.5%	Up to S$4,600
S$120,001 - S$160,000	15%	Up to S$6,000
S$160,001 - S$200,000	18%	Up to S$7,200
S$200,001 - S$240,000	19%	Up to S$7,600
S$240,001 - S$280,000	19.5%	Up to S$7,800
S$280,001 - S$320,000	20%	Up to S$8,000
Above S$320,000	24%	No limit

Withholding requirements

You're responsible for withholding income tax from employee salaries through the Pay As You Earn (PAYE) system. This applies to all employees earning more than S$2,800 per month.

Monthly withholding calculations use IRAS tax tables that factor in annual income projections. You'll need to adjust withholdings if an employee's circumstances change during the year.

Filing deadlines:

• Monthly PAYE payments: 15th of the following month
• Annual IR8A forms (employee income statements): By March 1, 2027
• Form IR21 (monthly PAYE summary): By March 31, 2027

Tax registration

Before your first payroll, register for PAYE withholding through IRAS's Corppass system. You'll need your company's Unique Entity Number (UEN) and business registration details.

Registration timeline:

• Submit PAYE registration within 30 days of hiring your first employee
• IRAS typically processes applications within 3-5 business days
• You'll receive your withholding tax reference number via email

New employers must also register employees individually using Form IR21 before their first salary payment.

Special tax considerations

Non-resident employees face different rules. They're taxed at 24% flat rate on Singapore-sourced income, or normal resident rates if that's more favorable. Short-term visitors (under 60 days) may qualify for exemptions.

Tax treaties can reduce withholding rates for certain nationalities. Singapore has agreements with over 80 countries that may provide relief from double taxation.

Stock options and equity require special handling. Gains from employee share schemes are generally taxable as employment income when exercised, not when granted.

Common tax mistakes

Incorrect non-resident classification is the biggest error we see. Many employers wrongly apply the 24% flat rate when employees qualify for resident treatment after 183 days in Singapore.

Penalties: S$1,000 fine plus make-up tax and interest.

Missing benefits-in-kind reporting catches many off guard. Company cars, housing allowances, and club memberships must be included in taxable income calculations.

Penalties: 200% of additional tax due, plus prosecution for serious cases.

Late PAYE payments compound quickly with both percentage penalties and daily interest charges.

Penalties: 5% of outstanding amount plus 6% annual interest from due date.

A S$60,000 salary in Singapore actually costs you S$67,800. Here's the breakdown.

Singapore keeps employer contributions relatively straightforward with just two main requirements: CPF and Skills Development Levy. You'll pay around 13% on top of base salaries for most employees.

Contribution breakdown

Contribution Type	Employer Rate	Employee Rate	Monthly Cap
CPF (Central Provident Fund)	17%	20%	S$1,292.50
Skills Development Levy	0.25%	0%	S$11.25
Total	17.25%	20%	S$1,303.75

The CPF cap significantly reduces your costs for high earners. Once an employee's monthly salary exceeds S$6,000, your maximum CPF contribution stays at S$1,020. The Skills Development Levy caps at S$11.25 monthly for salaries above S$4,500.

Total employer cost example

For a S$60,000 annual salary:

• Base salary: S$60,000
• CPF contributions: S$7,650
• Skills Development Levy: S$150
• Total employer cost: S$67,800
• Cost multiplier: 1.13 (you pay 13% more than base salary)

Higher earners cost proportionally less due to CPF caps. An employee earning S$120,000 annually only generates S$12,420 in employer contributions - just 10.4% above base salary.

Contribution caps and ceilings

CPF contributions cap at S$1,020 monthly once salaries exceed S$6,000. This creates significant savings for senior roles. The ordinary wage ceiling sits at S$6,000 monthly, meaning you won't pay CPF on salary portions above this amount.

Skills Development Levy caps at S$11.25 monthly for salaries above S$4,500. Most professional roles hit this cap quickly.

Registration requirements

You must register with CPF Board within 14 days of hiring your first Singapore employee. The online registration process typically takes 2-3 business days.

Required documentation includes:

• Company registration details
• Authorized signatory identification
• Employee employment details
• Bank account information for GIRO setup

Skills Development Levy registration happens automatically through CPF Board - no separate process needed.

Payment deadlines

All contributions are due by the 15th of the month following the salary month. Pay January salaries by February 15th, February salaries by March 15th.

Late payments incur 5% interest monthly on outstanding amounts. CPF Board actively pursues collection and can freeze company bank accounts for persistent non-payment.

Set up GIRO auto-deduction to avoid missed payments. Most employers use this method to ensure compliance and avoid manual processing errors.

Employees in Singapore get 7 days minimum vacation after one year of service. That's just over one week of paid leave to calculate, though most employers offer more.

How much annual leave do employees get?

The minimum starts low but builds up:

• First 6 months: No statutory entitlement
• After 6 months: 7 days annual leave
• After 8 years: 14 days annual leave

Most employers offer 14-21 days from day one to stay competitive. Calculate vacation pay at the employee's normal daily rate.

Carryover and payout rules

Employees can carry forward unused leave with employer approval, but there's no legal requirement to allow it. On termination, you must pay out all accrued but unused annual leave at the employee's last drawn salary rate.

The calculation is straightforward: (Monthly salary ÷ 26) × unused leave days.

What about sick leave?

Singapore's sick leave system splits the cost between you and the employee. Employees get up to 14 days paid sick leave per year after working 6 months.

Here's how the payments work:

• Days 1-3: Employee bears the cost (unpaid)
• Days 4-14: Employer pays at normal rate

Employees need a medical certificate for sick leave exceeding 3 consecutive days. For single-day sick leave, they can self-certify up to 5 times per year.

Outpatient sick leave

The 14-day entitlement covers outpatient treatment. For hospitalization, employees get additional paid leave - 60 days per year at full pay after 6 months of service.

How does parental leave affect payroll?

Maternity leave

Female employees get 16 weeks paid maternity leave. The government pays the first 16 weeks at 100% salary, capped at S$2,500 per week in 2026.

You pay the full salary and claim reimbursement from the government. Submit claims within 12 months of the child's birth.

Paternity leave

Male employees get 2 weeks paid paternity leave, also government-funded at 100% salary with the same S$2,500 weekly cap.

Shared parental leave

Parents can share an additional 4 weeks of leave between them. This is also government-funded at 100% salary, subject to the weekly cap.

Singapore public holidays 2026

Date	Holiday	Notes
1 Jan	New Year's Day	Fixed
29 Jan	Chinese New Year	2-day holiday
30 Jan	Chinese New Year	2-day holiday
14 Apr	Good Friday	Christian holiday
1 May	Labour Day	Fixed
2 May	Hari Raya Puasa	Muslim holiday
19 May	Vesak Day	Buddhist holiday
9 Aug	National Day	Fixed
8 Aug	Hari Raya Haji	Muslim holiday
24 Oct	Deepavali	Hindu holiday
25 Dec	Christmas Day	Fixed

When employees work on public holidays, pay them at double their normal hourly rate or give them another day off with pay.

What mandatory benefits affect payroll?

Central Provident Fund (CPF)

CPF is Singapore's mandatory retirement savings system. Both you and your employees contribute monthly:

For citizens and permanent residents:

• Employee contribution: 20% of salary
• Employer contribution: 17% of salary
• Combined total: 37% of monthly salary

For work permit holders:

• No CPF contributions required
• Consider providing alternative retirement benefits

Skills Development Levy (SDL)

Pay 0.25% of each employee's monthly salary as SDL, capped at S$11.25 per month per employee. This applies to all employees earning more than S$750 monthly.

Foreign worker levy

For work permit and S Pass holders, pay monthly foreign worker levies ranging from S$370 to S$800 depending on the pass type and sector.

Singapore tax authorities audit 15% of employers annually. Here's what they check.

Monthly filing requirements

You'll submit CPF contributions by the 15th of each month for the previous month's payroll. Late submissions trigger immediate penalties of S$5 per employee per day.

Use the CPF e-Services portal for all monthly filings. The system accepts contributions until 11:59 PM Singapore time on the deadline date.

Foreign worker levy payments are due monthly alongside CPF contributions. Submit through the MOM's WPOL system by the same 15th deadline. Penalties start at S$50 per worker per month for late payments.

Annual reporting

Form IR8A submissions are due by February 28, 2026 for the 2025 tax year. Submit electronically through IRAS's myTax Portal for each employee earning more than S$2,200 annually.

Provide employees with their IR8A statements by March 1, 2026. This includes all taxable income, benefits, and tax deductions for the year.

The annual CPF reconciliation happens automatically through the e-Services system, but you must verify contribution accuracy by January 31, 2026.

Employment pass holders require additional Form IR8S filings if they're directors or earn above S$22,000 monthly. Submit these by the same February 28 deadline.

Employee documentation

Employment contracts must be in English or a language the employee understands. Include specific salary breakdowns, working hours, and leave entitlements.

Payslips are mandatory monthly and must show:

• Basic salary and allowances
• CPF contributions (employee and employer portions)
• Income tax deductions
• Net pay amount
• Pay period dates

Keep all payroll records for 5 years minimum. This includes timesheets, leave applications, CPF submissions, and salary adjustments.

Penalties and violations

Violation	Penalty	Additional consequences
Late CPF filing	S$5 per employee per day	Interest charges at 17% annually
Missing IR8A submission	S$200 per form	IRAS audit trigger
Incorrect CPF contributions	17% interest on shortfall	Backdated payments required
No employment contract	S$5,000 fine	MOM investigation
Incomplete payslips	S$1,000 per occurrence	Repeat offenses double penalty

Regulatory oversight

Inland Revenue Authority of Singapore (IRAS) handles income tax compliance and audits. Access their myTax Portal at mytax.iras.gov.sg for all tax filings.

Central Provident Fund Board (CPF) oversees retirement contributions. Use their e-Services portal at www.cpf.gov.sg/employers for monthly submissions.

Ministry of Manpower (MOM) regulates employment practices and work passes. File foreign worker documentation through their WPOL system at www.mom.gov.sg.

For urgent compliance issues, contact IRAS at +65 1800 356 8300 or MOM at +65 6438 5122 during business hours.

Singapore's minimum wage increased 3.2% in 2026, from S$1,400 to S$1,450 per month for local workers and permanent residents.

The adjustment affects all full-time employees in cleaning, security, and grounds maintenance sectors. It'll also cover retail and food services throughout 2026. Part-time workers see their hourly rate rise from S$9.00 to S$9.30.

CPF contribution changes

Enhanced CPF rates - Effective January 1, 2026

CPF contribution rates increased for higher earners to boost retirement adequacy. The ordinary wage ceiling rose from S$6,000 to S$6,300 monthly. This affects employees earning above the previous cap.

Employers now contribute an additional 0.5% for wages between S$6,000-S$6,300. Employee contributions stay the same. That's roughly S$18 more per month in employer costs for affected employees.

Medisave contribution floor - Effective April 1, 2026

The Medisave contribution floor increased from S$60 to S$65 monthly for employees aged 65 and above. This ensures adequate healthcare coverage while keeping workforce participation incentives for older workers.

Tax administration updates

Digital filing mandate - Effective March 1, 2026

All employers must submit IR8A forms digitally through IRAS's enhanced portal. Paper submissions are no longer accepted. Penalties start at S$200 for non-compliance.

The new system auto-validates CPF and tax calculations. Processing times drop from 14 to 5 business days. You'll need your SingPass Corporate credentials and updated employee data formats.

Quarterly reporting expansion - Effective July 1, 2026

Companies with 50+ employees must now file quarterly employment reports instead of annual submissions. This affects payroll reconciliation timing and requires updated internal processes for mid-year adjustments.

Upcoming changes

Work-Life Balance Act provisions take effect January 1, 2027, introducing flexible work arrangement rights. Start reviewing remote work policies and documentation requirements now. The compliance framework releases in Q3 2026.

Enhanced parental leave expands from April 2027, extending paternity leave from 2 to 4 weeks. Budget for increased coverage costs and plan staffing adjustments for affected departments.