Payroll Services In Singapore
Companies in Singapore must pay the salaries of their employees in a timely manner. They must also ensure that the deductions made from the salaries of their employees are submitted to the Central Provident Fund (PF) on time. Computation of basic wages, overtime wages and bonuses are some of the basic elements of payroll processing.
Salary is strictly defined in Singapore by the Employment Act – the country’s chief labour law. Salary refers exclusively to any remuneration payable to an employee in respect of work done under a contract of service, including allowances. This means that additional payments such as overtime, bonuses or annual wage supplements as well as reimbursement for employee-incurred expenses and productivity incentivising payments are not included.
Statutory payroll requirements
The computation of donations to funds such as the Singapore Indian Development Association (SINDA), Mosque Building and Mendaki Fund (MBMF) and Eurasian Community Fund (ECF), together with levies including the Skills Development Levy, as well as withholding taxes, make calculating payroll a complex function.
In addition to contributions made by the employee, employers may also be required to make contributions to various government funds relating to the employee. Employers must contribute alongside employees to the employee’s Central Provident Fund account. Additionally, employers with foreign employees on S Passes or Work Permits are required to pay a Foreign Workers Levy calculated against the worker’s qualifications and the employer’s sector of operation.
All employers are also required to issue an itemised pay slip and a list of key employment terms once a month to every employee covered by the Employment Act, including a number of details such as the date payment was made, the employee’s basic salary, fixed and ad-hoc allowances paid, overtime hours worked and so on.
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