Singapore, formally the Republic of Singapore, is a sovereign island nation and city-state in Southeast Asia's maritime region. It is located approximately one degree north of the equator (137 kilometers or 85 miles) off the southern point of the Malay Peninsula, bordering the Malacca Strait to the west, the Singapore Strait to the south, the South China Sea to the east, and the Johor Straits to the north. The territory of the nation is made up of one main island, 63 satellite islands and islets, and one outlying islet, the total size of which has grown by 25% since the country's independence due to massive land reclamation efforts. It boasts the world's third greatest population density. Singapore has four official languages, English, Malay, Mandarin, and Tamil, in recognition of the need to protect the cultural identities of the nation's main ethnic groups. English is the language franca, and many public services are only accessible in English. Multiculturalism is written into the constitution and influences national policy in education, housing, and politics.
Singapore has a millennium of history, beginning as a maritime port known as Temasek and later as a significant component element of multiple succeeding thalassocratic empires. Its modern history started in 1819, when Stamford Raffles founded Singapore as a British Empire entrepôt commercial station. The Southeast Asian colonies were reorganized in 1867, and Singapore became directly under British rule as part of the Straits Settlements. Singapore was controlled by Japan during WWII and reverted to the British administration as a distinct crown colony after Japan's defeat in 1945. Singapore obtained self-government in 1959 and joined the new Malaysian federation in 1963, together with Malaya, North Borneo, and Sarawak. Ideological differences, most notably the perceived encroachment of Lee Kuan Yew's egalitarian "Malaysian Malaysia" political ideology into Malaysia's other constituent entities – at the expense of the Bumiputera and Ketuanan Melayu policies – eventually led to Singapore's expulsion from the federation two years later; Singapore became an independent sovereign country in 1965.
After experiencing early turbulence due to a lack of natural resources and a hinterland, the country quickly developed to become one of the Four Asian Tigers based on international trade and economic globalization, integrating itself into the world economy through free trade with minimal to no trade barriers or tariffs, export-oriented industrialization, and a large accumulation of received foreign direct investment, foreign-exchange reserves, and assets held by sovereign wealth funds. It is a developed nation that ranks joint-eleventh on the UN Human Development Index and has the world's second-highest GDP per capita (PPP). Singapore is the only nation in Asia with a AAA sovereign credit rating from all major rating agencies, making it a tax haven. It is a significant financial, marine shipping, and aviation center, and it is routinely recognized as one of the most expensive cities for expatriates and foreign employees to reside in. Singapore ranks well in important social variables such as education, healthcare, quality of life, personal safety, infrastructure, and housing, with an 88 percent homeownership rate. Singaporeans have one of the world's highest life expectancy rates, quickest Internet connection speeds, lowest infant mortality rates, and lowest levels of corruption. The nation is one of four in the industrialized world with a death penalty retentionist position, along with Japan, the United States, and Taiwan. Non-governmental organizations are outraged by Singapore's use of the death penalty for drug trafficking.
Singapore is a unitary parliamentary republic with a Westminster system of unicameral parliamentary administration and a common law legal system. While elections are free, the People's Action Party (PAP) wields significant control and dominance over politics and society, with limits on assembly, association, expression, and the press except for the Speakers' Corner; the PAP has ruled continuously since full internal self-government was achieved in 1959, with 83 out of 104 seats in Parliament as of the 2020 election, with the Workers' Party holding the remaining elected seats (WP). Singapore, one of ASEAN's five founding members, also serves as the headquarters of the Asia-Pacific Economic Cooperation (APEC) Secretariat and the Pacific Economic Cooperation Council (PECC) Secretariat, as well as hosting other international conferences and events. Singapore also belongs to the United Nations, the World Trade Organization, the East Asia Summit, the Non-Aligned Movement, and the Commonwealth of Nations.
After working for three months at a firm, employees are entitled to a minimum of seven days of yearly leave. After that, one day is added to each year until the eighth year reaches 14 days.
However, the employee is usually given 14 to 20 days of yearly vacation.
Singapore recognizes twenty (20) national public holidays.
The length of sick leave a worker is entitled to is determined by how long they have been employed by their company.
0-3 months: 5 days of non-hospitalization/15 days of hospitalization
4th Month: 8 days of non-hospitalization and 30 days of hospitalization
5th Month: 11 days of non-hospitalization and 45 days of hospitalization
After 6 months, there will be 14 days of non-hospitalization and 60 days of hospitalization.
When an employee is unable to work for more than 48 hours, they must notify their employer and produce a medical certificate upon their return.
Female workers who have worked for more than three months previous to giving birth and whose kid is a Singaporean citizen are entitled to 16 weeks of paid maternity leave. Employers are forbidden from dismissing employment during this time.
The first 8 weeks are covered by the employer for the first and second kid, and the additional 8 weeks can be reimbursed by the government. The government may refund all 16 weeks of maternity leave for the birth of a third child or more.
Maternity leave is 12 weeks if the kid is not a Singapore citizen.
In Singapore, paternity leave lasts two weeks.
The kid must be a Singapore citizen, and the father must have been lawfully married to the mother during the kid's conception and birth to qualify for Government-paid Paternity Leave (GPPL). If the kid is a Singapore citizen, the father is also entitled for paternity leave if the kid is adopted.
If their youngest kid is under the age of seven and a Singapore citizen, parents are entitled to six days of paid childcare leave each year.
Work-Related Injury Leave: The employer is responsible for all work-related injuries that an employee has sustained, whether directly or indirectly through insurance. If the employee is not hospitalized, they should be paid 100 percent of their average monthly wages in the 12 months preceding to the impairment for 14 days. They will collect 66.7 percent after 14 days.
As of September 1, 2020, all work-related medical leave must be reported to the Ministry of Manpower.
When a local employee is terminated, the employee's salary must be paid on the last day of employment if the employee resigns and serves the notice period; within seven days of the last day of employment if the employee resigns without notice and no notice period is served; on the last day of employment if the termination was for misconduct; and on the last day of employment if the termination was for cause.
In Singapore, the notice period is as follows. There will be a one-day notice period for employees who have worked less than 26 weeks. Employees who have worked for more than 26 weeks but less than two years will receive a one-week notice period. There will be a two-week notice period for employees who have been employed for more than two years but less than five years. There will be a four-week notice period for employees with more than five years of service.
Probation period in Singapore is optional but the common practice is 3 to 6 months.
Severance pay is calculated on the basis of all wages and benefits due on the last day of employment. If an employee has worked for the company for at least two years, they are entitled to "retrenchment benefits." The amount paid to the employee is determined by the terms of the employment contract or collective bargaining agreement, as applicable. In general, retrenchment benefits range from two weeks to one month for each year of service with the company.
Weekly working hours should not exceed 44. Employees who work fewer than five days per week should not exceed nine hours per day. Individuals who work five or more days per week should not exceed eight hours per day.
For employees who are covered by the Employment Act, an employee must be paid 150% of the hourly basic pay of rate for any overtime hours.
A non-workman earning up to $2,600 or a workman earning up to $4,500 are the only employees eligible to overtime payment.
Singapore does not have a minimum wage policy.
Singapore offers universal healthcare, which is financed via a combination of government subsidies and obligatory payments from businesses and workers. Citizens and residents must join in MediShield Life, a national basic health care insurance plan that covers major hospitalization and certain outpatient expenses. While the government subsidizes premiums and the expenses of some treatments, there is an annual deductible of between SGD 1,500 and SGD 3,000, as well as co-payments ranging from 3% to 10%.
Most executives seek additional health and life insurance, although a small business may provide a stipend in place of obtaining insurance. Executives working for US technology firms in Singapore often seek stock options.
Companies (both resident and non-resident) that do business in Singapore are taxed on their Singapore-sourced revenue as it occurs, as well as on foreign-sourced income when it is repatriated or presumed remitted to Singapore. Non-residents must pay withholding tax (WHT) on certain kinds of income (e.g., interest, royalties, technical service fees, rental of movable property) if they are considered to have arisen in Singapore.
The corporate income tax is levied at a flat rate of 17%. A partial tax exemption and a three-year start-up tax exemption are offered to qualified start-up businesses.
Income is taxed when it is earned in or generated from Singapore, regardless of whether the person is a Singapore resident. Income generated from sources outside Singapore is taxable only if received in Singapore by a resident person via a Singapore partnership.
Residents are eligible to various personal allowances and are subject to progressive tax rates ranging from 0% to 22%. Non-residents are not entitled to any personal allowances and must pay a flat rate of 22 percent tax. Non-residents' employment income is taxed at the higher of a flat rate of 15% or the graduated resident rates with personal allowances. Non-resident directors are not eligible for this benefit.
GST is levied at 7% on supplies of goods and services made in Singapore by a taxable person in the course or advancement of his or her business. In the 2018 Budget, it was stated that this rate will be raised to 9% between 2021 and 2025. The GST rate was set to stay at 7% in 2021, according to the 2020 Budget.
Only specified financial services (including life insurance), the sale or rental of residential property, and the import and local supply of investment precious metals are excluded from GST (IPM). The zero-rating provision is only applicable to the export of commodities and foreign services.
Work permits are necessary in Singapore, although the sort of permission required is determined by the individual's abilities. To work in Singapore, a person with a degree, professional credentials, or specialized expertise will need an Employment Pass.
Other skilled or unskilled foreign employees, on the other hand, need a Work Permit. Singapore's Ministry of Manpower (MOM) is in charge of granting all forms of Employment Passes.
Depending on the applicant's pay, several kinds of Employment Passes may be awarded, but the core processes remain the same. An Employment Pass is determined by the person and the firm for which they work. If an Employment Pass holder wishes to move employment, the previous employer must cancel the current EP and the new employer must apply for a new one. If the holder's work in Singapore ends or he or she receives Permanent Resident status, the Employment Pass must be terminated.
A contract of service in Singapore is a legally binding agreement between an employer and an employee. Singapore normally enables parties to freely negotiate terms and engage into service contracts, as long as they do not include prohibited provisions. A service contract might be written or verbal, stated or implicit. The agreement might take the form of a letter of appointment, an employment contract, or an apprenticeship agreement. Employers must, however, give significant employment conditions in writing to workers covered by the Employment Act within 14 days of the commencement of employment.
There is no set length for assignments. This is usually indicated in the employment contract for fixed-term employments.
Singapore Dollar
The following is the procedure for establishing a Singapore subsidiary:
1. Obtain approval for and reserve your business name.
2. Locate a registered office with a Singapore address.
3. Appoint two individuals from your firm to function as the Singapore subsidiary's representatives.
4. Keep a corporate seal on hand in case there are any issues with verifying a document from the firm. While not needed, this procedure helps in keeping things organized and professional.
5. Open a corporate bank account in Singapore with a full-service institution.
6. Before hiring staff, sign up to contribute to the Central Provident Fund (CPF) at a Singapore insurance firm. Each month, you will make CPF contributions on behalf of your employees.
In addition, the legislation compels you to apply online in order to set up your CPF contribution information. You'll need your representative's SingPass and the Unique Entity Number of your subsidiary (UEN). Approval will take two or three business days.
When you are authorized, you will get an email and a welcome letter that includes:
1. A CPF Submission Number (CSN)
2. Payment Advice Through Form CPF91
3. An Application for Interbank GIRO Form
The CSN is very crucial. Singapore subsidiary regulations require you to cite the CSN while submitting your CPF payments or communicating with the CPF Board.
To use any of Singapore's Government-to-Business (G2B) digital services, all local firms having a UEN must register for a Singapore Corporate Access (CorpPass) as of 2018. Subsidiaries holding a UEN will continue to utilize SingPass, or the Singapore Personal Access gateway, while new local businesses will use CorpPass.
