Navigating the income tax bracket Singapore is essential for business founders, corporate professionals, and high-net-worth individuals managing diverse income streams. With updates to regulations and the IRAS income tax bracket structure always coming in, understanding your income tax bracket SG in 2025 is not only crucial for compliance but also for efficient tax planning.
In this comprehensive guide, we’ll give you an Income Tax Bracket Singapore 101. We’ll walk you through the key income tax brackets, how IRAS Singapore determines your taxable income, what deductions you’re entitled to, and how to optimize your tax liabilities, whether you’re a local professional or an expatriate business owner.
What Is the Income Tax Bracket in Singapore?
Definition of Income Tax Bracket
For starters, let’s understand what an income tax bracket in Singapore is. An income tax bracket refers to a range of incomes taxed at specific rates. The Singapore income tax system is structured progressively, meaning the rate increases as income levels rise.
However, contrary to popular misbeliefs, this doesn’t mean your entire income is taxed at the highest rate you qualify for. Instead, different portions of your income are taxed at the corresponding bracket rates. This system ensures that individuals with higher earnings contribute a proportionate amount in taxes.
How IRAS Determines Taxable Income
The Inland Revenue Authority of Singapore (IRAS) defines chargeable income as that portion of income that remains after allowable deductions and personal reliefs are subtracted from your total income. This includes:
- Employment income
- Business income
- Rental income
- Director’s fees
- Bonuses and other benefits
Business founders and professionals who earn income from multiple sources, including foreign income or capital gains, must ensure accurate reporting to avoid potential tax issues. It is advisable to consolidate and categorise income sources with the help of accounting services to avoid under-reporting or overpayment losses.
Why Understanding Your Bracket Matters
Understanding your income tax bracket SG is not just about compliance and insight into your finances. It plays a vital role in:
- Strategic compensation planning: Business owners can structure their salaries and directors’ fees to optimize taxes.
- Investment decisions: Understanding tax brackets helps time capital gains or dividend payouts to optimize your taxes.
- Tax-efficient giving: You may plan your charitable donations accordingly to reduce taxable income.
- Budgeting and forecasting: Accurate personal finance management and wealth planning depend on knowing your post-tax income.
Hence, for founders and professionals, this knowledge influences broader decisions such as CPF top-ups, insurance planning, donations, and business investments.
Updated Income Tax Brackets in Singapore for 2025
Personal Income Tax Rates by Income Range
Effective from Year of Assessment (YA) 2025, IRAS Singapore has adjusted the income tax brackets to enhance progressivity. These changes primarily affect high-income earners, making it even more critical for business leaders and professionals to review their tax planning strategies.
Below is a breakdown of the revised tax structure:
Income Tax Bracket Chart (YA 2025)
| Chargeable Income (SGD) | Tax Rate (%) | Gross Tax Payable (SGD) |
|---|---|---|
| First $20,000 Next $10,000 | 0% 2% | $0 $200 |
| First $30,000 Next $10,000 | – 3.5% | $200 $350 |
| First $40,000 Next $40,000 | – 7% | $550 $2,800 |
| First $80,000 Next $40,000 | – 11.5% | $3,350 $4,600 |
| First $120,000 Next $40,000 | – 15% | $7,950 $6,000 |
| First $160,000 Next $40,000 | – 18% | $13,950 $7,200 |
| First $200,000 Next $40,000 | – 19% | $21,150 $7,600 |
| First $240,000 Next $40,000 | – 19.5% | $28,750 $7,800 |
| First $280,000 Next $40,000 | – 20% | $36,550 $8,000 |
| First $320,000 Next $180,000 | – 22% | $44,550 $39,600 |
| First $500,000 Next $500,000 | – 23% | $84,150 $115,000 |
| First $1,000,000 In excess of $1,000,000 | – 24% | $199,150 |
This updated system ensures that those in the highest income tax bracket in Singapore pay a proportionally fair share of tax, while still preserving the country’s competitive edge for talent and capital.
How to Calculate Your Personal Income Tax
Step-by-Step Income Tax Calculation
Whether you’re a startup founder, a salaried executive, a professional, or a consultant with multiple projects and streams of income, the following steps denote how your personal income tax is calculated:
1. Add up the Total Annual Income
- Salary
- Bonuses
- Rental Income
- Business or freelance income
2. Subtract Allowable Deductions
- Employment expenses
- Donations to approved Institutions of a Public Character (IPCs)
- Business expenses (for self-employed individuals)
3. Apply Personal Reliefs
- Earned Income Relief
- NSman Relief
- Parent/Spouse/Child Relief
- Life insurance premium relief
4. Arrive at Chargeable Income
- Total Income – Deductions – Reliefs = Chargeable Income
5. Apply Tax Rates According to Brackets
- Use the 2025 progressive rates listed above
Common Deductions and Reliefs for Residents
IRAS allows several deductions and reliefs to encourage socially beneficial activities and personal financial responsibility. These include:
- CPF Contributions: Mandatory contributions reduce your taxable income.
- Course Fee Relief: For continuous professional development.
- SRS Contributions: Supplementary Retirement Scheme top-ups.
- Parent/Child Reliefs: For individuals supporting dependents.
- Charitable Donations: Up to 250% tax deduction.
Utilising these properly can help professionals remain within a lower income tax bracket SG.
What Is the Minimum Income Tax Bracket and Top Income Tax Bracket IRAS?
What Income Is Considered in the Top Income Tax Bracket in Singapore?
In Singapore, chargeable income up to $20,000 is not taxable and is the lowest income tax bracket. The top income tax bracket IRAS in 2025 applies to chargeable income exceeding SGD 1,000,000 taxed at 24%. This bracket is commonly applicable to:
- Founders drawing high salaries
- Professionals with bonuses and investment income
- Individuals earning foreign-sourced income remitted into Singapore
How High-Income Earners Can Optimize Taxes
If you fall under the highest income tax bracket, strategic tax planning is essential:
- Split income between family members (where legitimate)
- Utilise business structures to hold income-generating assets
- Make large donations to IPCs
- Top up Central Provident Fund (CPF) and Supplementary Retirement Scheme (SRS) accounts
- Defer income to lower-income years
Engaging experienced fund services or accounting services like Lanturn is key to legally minimizing tax liabilities in Singapore.
Tax Filing and Deadlines for 2025
Key IRAS Tax Filing Dates
Here are a few important tax filing Singapore deadlines for YA 2025:
- 1 March 2025: IRAS e-Filing portal opens
- Filing notifications (SMS/Email/Letter) were sent between Feb to Mar.
- If you received a notification to file, you may e-File from 1 Mar to 18 Apr.
- Generally, most taxpayers received their tax bills from end of Apr onwards.
Founders and business owners must also ensure accurate and timely submissions of:
- Form IR8A for employees
- Director’s fee declarations
- Schedules for employee stock options
Penalties for Missing Deadlines
- Late filing: Issue an estimated Notice of Assessment. You must pay estimated tax within 1 month.
- IRAS may offer defaulting tax payers the option to pay a composition amount of up to $5,000 per offence, instead of prosecution.
- Further non-compliance: Court summons
- Failure to pay tax returns for 2 years or more may lead to court conviction and an order to pay:
- A penalty that is twice the amount of tax assessed; and
- A fine of up to $5,000.
Tips to Avoid Errors in Tax Submissions
- Use IRAS’ myTax Portal regularly
- Cross-verify pre-filled business or professional information
- Maintain proper documentation of all deductions
- Employ licensed accounting services or tax consultants
Income Tax for Foreigners and Expats in Singapore
Resident vs Non-Resident Tax Brackets
Tax residency affects which income tax bracket applies:
- Tax Residents: Taxed on a progressive scale with full reliefs
According to the IRAS, you will be treated as a tax resident for a particular Year of Assessment (YA) if you are a:
- Singapore Citizen or Singapore Permanent Resident who resides in Singapore except for temporary absences; or
- Foreigner who has stayed/worked in Singapore:
- For at least 183 days in the previous calendar year; or
- Continuously for 3 consecutive years, even if the period of stay in Singapore may be less than 183 days in the first year and/or third year; or
- Foreigner who has worked in Singapore for a continuous period straddling 2 calendar years and the total period of stay is at least 183 days (including physical presence immediately before and after employment). This applies to employees who entered Singapore but excludes directors of a company, public entertainers, or professionals.
- Non-Residents:
- Employment income: 15% flat or progressive resident tax rate (whichever is higher)
- Director’s fees, consultation fees, and all other income, including rental income from properties and pension: Flat 24%
- A non-resident may claim deductions on expenses and donations to save tax. However, they are not allowed to claim personal reliefs.
Expat Tax Benefits and Exemptions
- No capital gains tax
- Foreign-sourced income not taxed unless remitted
- DTAs (Double Taxation Agreements) prevent double taxation
Expats receiving overseas bonuses or investments may benefit by retaining earnings offshore unless needed locally.
How Foreign-Sourced Income Is Treated
- Not taxed if not remitted
- Exception: Income deemed to be derived from Singapore (For example, through a partnership operating within the country)
- Businesses with cross-border operations should consult tax and accounting services like Lanturn for guidance
Lanturn Can Help With Tax Compliance in Singapore
Our Corporate & Individual Tax Support Services
At Lanturn, we offer a suite of services to ease your tax journey:
- Personal and Corporate Tax Filing
- IRAS Liaison for disputes or clarifications
- GST Registration and GST Filing Quarterly
- Dormant Returns and Tax Filing
- Bookkeeping and accounting services
Why Businesses and Individuals Choose Lanturn
- Deep domain knowledge of Singapore tax laws
- Tailored tax strategies for founders and executives – so you pay less with the right deductions applied.
- Support across IRAS Singapore submissions and deadlines
- Technology-enabled compliance monitoring
- Transparent and fair pricing – choose plans as your business scales
Book a Consultation for Tax Planning or Filing
Avoid last-minute surprises and penalties. Our tax experts at Lanturn keep track of all your deadlines while you focus on growing your business.
Book a Free Consultation Today.
FAQs
Singapore’s tax system is progressive for residents and flat for non-residents (progressive in certain cases). It is globally recognised for being transparent, efficient, and conducive to business.
Refer to your chargeable income after deductions and match it with the IRAS tax bracket table provided to know your income tax bracket and calculate your tax obligations.
Yes. The top income tax bracket rate has increased to 24% for income exceeding SGD 1,000,000 from YA 2025 onwards.
No. Non-residents pay either a flat rate or 15% flat or progressive resident tax rate (whichever is higher), depending on the nature of their income. Director’s fees, consultation fees, and all other income, including rental income from properties and pension is taxed at flat 24%
Yes. Utilise CPF top-ups, SRS, deductible donations, business expenses, and legitimate reliefs.
Absolutely. Only tax residents enjoy progressive rates and reliefs. Non-residents face restricted benefits.
The income tax lowest bracket in Singapore is $0 to $20,000, which is fully tax-free.
Conclusion
Understanding the income tax bracket Singapore system is fundamental for financial planning, especially in a dynamic economy like Singapore’s. Whether you’re navigating complex income streams, willing to minimize how much tax you pay, or simply ensuring you meet your tax filing Singapore obligations, staying informed gives you a strategic advantage. For personalised advice and seamless compliance, connect with Lanturn’s expert team.
