How to avoid paying full Income Tax and continue with GIRO while changing job in Singapore?
Abhinash Singh Rajput
7 months ago
Introduction :
Last year I faced problem when I was leaving the job in Singapore and joining another company.
I was working as a Software Engineer in Citi Bank in Singapore since 2013.I had resigned to join a new Company in Singapore. My IPA was approved. I was paying my taxes in EMI through GIRO. My consultancy had stopped my last month salary. My consultancy told me that I have to clear full Tax till Today before joining new Company. This was a big issue for me as I am living with family in Singapore and if they deduct full Income Tax till today, I will be left with very less money this month.
Issue with consultancy in Singapore :
Currently all the consultancy Works as Following in Singapore:
- When you resign from any company, your consultancy will block your last month Salary.
- On the last working day, your consultancy will go to IRAS Tax Department and pay the Full Tax Amount till today from your last month Salary to Government and will return the balance amount to you after 2 weeks of leaving Company.
- Even if you are paying Tax by EMI currently still they will pay the full due amount plus Tax till Today from your last month Salary to Government and will return the balance amount to you after 2 weeks of leaving Company.
- So, you will get balance amount after 2-4 weeks depending upon consultancy to consultancy. But this may be a problem for most of the people living in Singapore as paying full tax amount will leave them in financial difficulties.
Let's discuss how we can avoid paying the full tax amount and continue paying through EMI GIRO.
There are two ways we can achieve this :
IRAS Department :
According to IRAS rules, any employee paying his income tax in GIRO instalments while employed by ABC. When he ceases employment with ABC, the GIRO instalment plan will be terminated once IRAS processes his tax clearance.
But if he is immediately re-employed in Singapore and wishes to continue paying his tax in GIRO instalments, he has to send an email to IRAS along with the following documents:
A copy of his new work pass/the in-principle approval letter (IPA) from the Ministry of Manpower
A copy of his employment contract with his new employer/a confirmation letter from his new employer, that indicates his employment commencement date with them.
Please follow the below steps:
- Open the IRAS Website Url [ https://www.iras.gov.sg/irashome/web/pages/feedback/formTaxOnIndividuals.aspx ]
- Fill all the details with below description
- Don't forget to attach IPA Letter and Offer Letter.
MOM Department :
Please follow the below steps :
- Send an Email to [taxclear@iras.gov.sg] explaining that you have resigned from your current company and joining a new Company in Singapore itself. Attach Your Offer Letter and Approved IPA Letter.
- In Email explain him that currently You are paying Tax in EMI through GIRO Payment and You want to Continue with the same.
- Now, IRAS Tax Department will note your data into system and they will continue Tax Payment in EMI through GIRO Payment.
- And IRAS Tax Department also will tell your consultancy to return Full Salary to You without deducting any Tax Amount as they will deduct Tax through EMI.
See More Reviews
Abhinash Singh Rajput
Full Stack Developer at Singapore
7 months ago
Featured Blogs
Category: Technology
Author: Sweety Singh
Posted : 16 days ago
Category: Technology
Author: Mahima Choudhari
Posted : 18 days ago
Category: Technology
Author: Mahima Choudhari
Posted : 18 days ago
Category: Technology
Author: Rajeshwar Reddy Gulla
Posted : 5 months ago
Category: Technology
Author: Priya Gupta
Posted : 5 months ago
Category: Technology
Author: Priya Singh
Posted : 6 months ago
Category: Technology
Author: Priya Singh
Posted : 6 months ago
Category: Technology
Author: Abhay Singh Chouhan
Posted : 7 months ago
Category: Technology
Author: Ashmit Patel
Posted : 7 months ago
Category: Technology
Author: Abhinash Singh Rajput
Posted : 7 months ago
Category: Technology
Author: Mahak Chahal
Posted : 8 months ago
Category: Technology
Author: Umang Patel
Posted : 2 years ago
Category: Technology
Author: Pratima Singh
Posted : 2 years ago
Category: Technology
Author: Victor Mathew
Posted : 2 years ago
Featured Questions
Category: Technology
Author: Sweety Singh
Posted : 16 days ago
Category: Technology
Author: Mahima Choudhari
Posted : 18 days ago
Category: Technology
Author: Mahima Choudhari
Posted : 18 days ago
Category: Technology
Author: Rajeshwar Reddy Gulla
Posted : 5 months ago
Category: Technology
Author: Priya Gupta
Posted : 5 months ago
Category: Technology
Author: Priya Singh
Posted : 6 months ago
Category: Technology
Author: Priya Singh
Posted : 6 months ago
Category: Technology
Author: Abhay Singh Chouhan
Posted : 7 months ago
Category: Technology
Author: Ashmit Patel
Posted : 7 months ago
Category: Technology
Author: Abhinash Singh Rajput
Posted : 7 months ago
Category: Investment
Author: Sushmita Pal
Posted : 1 days ago
Category: Investment
Author: Sushmita Pal
Posted : 3 days ago
Category: Startup
Author: Anushka Trivedi
Posted : 4 days ago
Category: Investment
Author: Anushka Trivedi
Posted : 4 days ago
Category: Investment
Author: Anushka Trivedi
Posted : 4 days ago
Category: Startup
Author: Anushka Trivedi
Posted : 9 days ago
Category: Startup
Author: Anushka Trivedi
Posted : 12 days ago
Category: Technology
Author: Sweety Singh
Posted : 12 days ago
Category: Stocks
Author: Sweety Singh
Posted : 14 days ago
Category: Technology
Author: Sweety Singh
Posted : 14 days ago