Does a company have to pay any taxes when it hires employees in Singapore?

Yes. In general, when a company employs Singapore citizens and permanent residents (PR), it pays CPF employer contributions. Foreign employees are not covered by CPF, but there is a tax clearance procedure when they leave the company or depart Singapore.

• Singapore citizens and permanent residents: Employer and employee contributions are paid together at rates set according to wages and other factors, and the rates may vary depending on the employee's age, status and so on.
• Foreign employees (Employment Pass holders, etc.): Generally not subject to CPF contributions.
• Submitting employee income records: Employees file their own income tax, and the company submits employees' employment income to IRAS through Form IR8A or the Auto-Inclusion Scheme (AIS).
• If a non-citizen employee leaves the company: The company applies to IRAS for tax clearance (Form IR21), which must be submitted at least one month before the last day of employment. The company may need to withhold amounts payable until the clearance is completed.

Tax treatment can differ depending on the company's revenue, shareholder structure and transactions, so please consult an accounting professional before applying it.

The Lee Kim Alliance accounting team provides accounting and tax consultation.

As of November 2026, source: CPF Board, IRAS