Working Remotely from Singapore due to COVID-19

Singaporeans/Singapore Permanent Residents exercising overseas employment and are now working remotely from Singapore for that employment

If you have been working from Singapore remotely for your overseas employer since 2020 due to COVID-19, we are prepared to continue to consider you as not exercising an employment in Singapore for the period from the date of your return to the date you left Singapore in 2020, or up to 30 Jun 2021, whichever is earlier, provided that all the relevant conditions stipulated below are met.

If the period of your stay in Singapore did not extend beyond 31 Dec 2020

The qualifying conditions are:

(a) There is no change in the contractual terms governing your employment overseas before and after your return to Singapore; and

(b) This is a temporary work arrangement due to COVID-19.

If the above conditions are met, your employment income for the period of your stay in 2020 will not be taxable in Singapore. Otherwise, normal tax rules will apply to determine the taxability of your employment income for such period.

If the period of your stay in Singapore extended to 2021

(i) For the period up to 30 Jun 2021

Besides conditions (a) and (b) above, the additional qualifying conditions are:

(c) The work performed by you during your stay in Singapore would have been performed overseas if not for the travel restrictions caused by COVID-19; 

(d) You will leave Singapore as soon as you are able to do so before 30 Jun 2021; and

(e) Your employment income earned during the stay in Singapore from 1 Jan 2021 to 30 Jun 2021 is subject to tax in the country of your overseas employer.

Condition (d) will not be considered as breached if the reason you continue working remotely from Singapore is due to the escalating COVID-19 situation in the country of your overseas employer (such as resurgence of cases and new strain of virus) and there is an elevated risk of you contracting COVID-19 should you return to work overseas.

If you meet all the conditions under (a) to (e), your employment income for the period of your stay up to 30 Jun 2021 will not be taxable in Singapore. If you meet the conditions under (a) and (b) but did not meet the additional conditions under (c) to (e), only your employment income for the period of your stay up to 31 Dec 2020 will not be taxable in Singapore. Normal tax rules will apply to determine the taxability of your employment income for the period of your stay from 1 Jan 2021 to 30 Jun 2021. 

Supporting documents

Please keep relevant supporting documents to substantiate that the qualifying conditions are met and provide them upon IRAS’ request.

(ii) For the period from 1 Jul 2021

Similar to other employees who are working in Singapore, your employment income in relation to your work done in Singapore from 1 Jul 2021 onwards would be subject to Singapore income tax based on normal tax rules.

You may write in to IRAS* for a review of the treatment of your employment income, if you consider yourself as not exercising an employment in Singapore and you are here under the following circumstances:

(a) The country where you are based has imposed a ban on the entry of travellers into the country or it is impossible to travel due to unavailability of flights or other modes of transport; and

(b) You will leave Singapore as soon as you are able to.

The information to be provided should include the following:

1. Name and NRIC number
2. Date on which you started to work remotely from Singapore
3. Name and address of your employer and your designation
4. The number of staff who report to you, if any and where they are currently based
5. Name and designation of your reporting officer and where he/she is currently based
   
6. Nature and scope of your work, before and after you returned to Singapore, together with supporting documents
7. Whether your employer has any related entities in Singapore and if so, the name of each entity
8. Whether any of your work performed/to be performed in Singapore is for clients in Singapore and/or business activities of any entities in Singapore, regardless of whether they are related to your employer.  If so, please provide the relevant details.
9. Whether the work performed/to be performed by you during your stay in Singapore would have been performed overseas if not for the travel restrictions caused by COVID-19
10. Documents to support that you have made every effort to leave for the country where you are based but were unable to do so
11. Documents to support that your employment income earned during the stay in Singapore is subject to tax in the country of your overseas employer
    

*via  myTax Mail or Email Us

Non-resident foreigners exercising overseas employment who are on short-term business assignment in Singapore and are unable to leave due to COVID-19 

If you are unable to leave Singapore in 2020 due to travel restrictions caused by COVID-19 and have been working remotely from Singapore for your overseas employer during your extended stay in Singapore, we are prepared to consider you as not exercising an employment in Singapore for the period of your extended stay in 2020, if the following conditions are met:

1. the period of your extended stay is for a period of not more than 60 days; and 
2. the work you have done during your extended stay is not connected to your business assignment in Singapore and would have been performed overseas if not for COVID-19.

If all the conditions are met, your employment income for the period of your extended stay in Singapore in 2020 will not be taxable. Normal tax rules will apply to determine the taxability of your employment income for the period of your extended stay in Singapore, if any of the conditions are not met. 

For example, you had worked in Singapore for 15 days and completed your short-term assignment on 6 March 2020. Thereafter, you extended your stay in Singapore due to COVID-19 and you continued to work from Singapore remotely for your overseas employer. If your extended stay in Singapore from 7 March 2020 to the date of your departure from Singapore (both dates inclusive) is not more than 60 days, and the work done would have been performed overseas if not for the travel restrictions caused by COVID-19, you will not be considered as exercising an employment in Singapore during the period of your extended stay. Nonetheless, the taxability of the employment income for your short-term assignment (excluding the period of your extended stay) is subject to normal tax rules^#. In this example, as the assignment was completed within 15 days, which is not more than 60 days, the employment income for your short-term assignment will be exempt from tax. 

However, if you were given another business assignment in Singapore during your extended stay, the employment income for the period of your whole stay in Singapore for both assignments will be subject to normal tax rules^#.     

^#Under normal rules, your tax liability as a non-resident for the period you are on short-term business assignment(s) in Singapore is determined as follows:

• If the total period of your assignment(s) is not more than 60 days in a calendar year, your employment income for the period is tax exempt
• If the total period of your assignment(s) is more than 60 days but less than 183 days in a calendar year, your employment income for the period will be taxed at 15%, or the resident rates, whichever results in a higher tax amount

List of Frequently Asked Questions (FAQ) (PDF, 550KB)

Tax Implications on Employees' Tax Reporting in the Face of COVID-19 (Common Scenarios for YA 2021 & YA 2022) (PDF, 647KB)

Interpretation of the provisions of Singapore’s Avoidance of Double Taxation Agreements (DTAs)

As a guide to the interpretation of the provisions of Singapore’s DTAs taking into account the COVID-19 pandemic, references may be made to the  OECD Secretariat Analysis of Tax Treaties and the Impact of the COVID-19 Crisis published by the OECD on 3 April 2020 and the Updated Guidance on Tax Treaties and the Impact of the COVID-19 Pandemic published by the OECD on 21 January 2021.

Determining whether the days of presence threshold provided in the DTA provision applicable to employment income has been exceeded

In paragraphs 53 to 56 of the OECD’s updated guidance, it is noted that the COVID-19 pandemic has caused individuals who are resident in one jurisdiction and exercised an employment in another jurisdiction (i.e. the source jurisdiction) to become stranded in the source jurisdiction. As such, where such an individual (i) is prevented from leaving the source jurisdiction by COVID-19 restrictions; and (ii) would have otherwise left the source jurisdiction and qualified for the exemption from source taxation in accordance with the DTA provision applicable to employment income, it would be reasonable to disregard the additional days spent in the source jurisdiction given the exceptional COVID-19 circumstances. Paragraph 5 of the OECD’s updated guidance also clarified that the updated position “seeks to avoid instances of double taxation but cannot be relied on to create instances of double non-taxation”.

In this regard, for the purpose of determining whether the days of presence threshold provided in the DTA provision applicable to employment income has been exceeded, IRAS will disregard the period of extended stay in Singapore if the following conditions are met: 

(a) the non-resident employee is prevented from leaving Singapore because:

1. he/she is serving COVID-19 Quarantine Order or Stay-Home Notice; or
2. the jurisdiction of residence or the jurisdiction where the non-resident employee is based or had made plans to travel to has imposed a ban on the entry of travellers into the jurisdiction which is applicable to that non-resident employee; or
3. it is impossible to travel due to unavailability of flights or other modes of transport; and
   

(b) the non-resident employee would otherwise have left Singapore such that the employment activities would not have been carried out in Singapore; and

(c) the non-resident employee is subject to tax in the jurisdiction of residence on the employment income derived from the employment activities carried out in Singapore if, as a result of the period of extended stay in Singapore being disregarded, the non-resident employee was not taxed in Singapore on those income.

The non-resident employee should keep all relevant documentations and records to substantiate that all the above conditions are met, and to provide the information to IRAS upon request.