The Not-Ordinarily-Resident (NOR) Scheme was introduced to make it attractive for individuals with global or regional business experience to live and work in Singapore.
The scheme grants favourable tax treatment to qualifying individuals for a period of five years of assessment, provided they meet the following criteria:
If an individual is accorded the NOR status, he or she may enjoy the benefit of apportionment of his/her employment income and tax exemption on contributions made by the employer to an overseas pension fund for five consecutive years, subject to qualifying conditions.
Under the apportionment of Singapore employment income concession, the portion of the Singapore employment income that corresponds to the number of days the individual spent outside Singapore for business reasons, as a resident Singapore employee, is exempt from tax.
To enjoy the benefit of time apportionment of their employment income, an NOR taxpayer must:
The other concession under the NOR Scheme provides for tax exemption on employers’ contributions to a non-mandatory Overseas Pension Fund or Social Security Scheme.
In order to qualify for the tax exemption under this concession, the following conditions must be met:
On 19 October 2018, the Inland Revenue Authority of Singapore (IRAS) provided further clarification that condition 3 is considered met where:
The above was revised from the previous clarification by IRAS that condition 3 is not satisfied if the contribution is not charged or recharged to any Singapore entity. For further information, please refer to IRAS’ website.
Source: Inland Revenue Authority of Singapore