Accounting Solutions Singapore Editorial Team · Last reviewed 18 October 2026
If your company pays an overseas software provider, consultant, lender or landlord, Singapore tax may need to be withheld from that payment and paid to IRAS. The company paying is responsible for it, not the overseas party. We check whether it applies to each payment, work out the amount, file the S45 and keep the paperwork, so it doesn’t turn up months later as a surprise.
At a glance
| Question | Short answer |
|---|---|
| Who is responsible? | The payer. You withhold the tax and pay it to IRAS |
| When does it apply? | On certain types of payment to non-residents, such as interest, royalties, some service fees, rent of movable property and fees to non-resident professionals or directors |
| What do you file? | Form S45, online through myTax Portal. E-filing has been compulsory since 1 July 2016 |
| When is it due? | By the 15th of the second month after the date of payment (or deemed payment) |
| What if you’re late? | A 5% penalty, then 1% for each completed month the tax stays unpaid 30 days after the due date, up to 15% in total |
| Can treaties reduce the rate? | Often, if the payee’s country has a tax treaty with Singapore and the conditions are met |
When tax has to be withheld
Withholding tax applies to specific types of payment to non-residents, not to every overseas invoice. The common ones are:
- interest and loan fees
- royalties, and payments for the use of intellectual property or know-how
- technical, management and other service fees, where the services are performed in Singapore
- rent or hire of movable property
- fees to non-resident professionals, directors and public entertainers
[VERIFY AGAINST IRAS “Types of Payment and Withholding Tax (WHT) Rates” BEFORE PUBLISHING, then delete this line. The rates below come from a third-party summary, because IRAS’s rates page would not load for me.]
| Payment to a non-resident | Typical rate |
|---|---|
| Interest | 15% |
| Royalties | 10% |
| Technical and management fees (services performed in Singapore) | 17% for companies |
| Rent of movable property | 15% |
| Professional fees | 15% of gross, or 24% of net income, for individuals |
| Director’s remuneration | 24% |
| Public entertainer | 15% |
Some rates are the final tax for operations outside Singapore, and a different rate may apply for operations in Singapore. Dividends and ship charter fees are not subject to withholding tax. An outright sale of all rights in intellectual property, or buying a copyrighted article for your own use, is generally not subject to it either.
Not sure which category your payment falls into? That’s the question most people come to us with. A software subscription, a licence for a platform and a bespoke development fee can fall in different places.
What counts as the “date of payment”
This is where companies slip, because it isn’t always the day the money leaves your bank. IRAS treats tax as due on the earliest of:
- the date the amount becomes due and payable under the contract (if there’s no contract, the invoice date),
- the date it is credited to the non-resident’s account or otherwise dealt with on their behalf, or
- the date the cash is actually paid.
Credit terms you’ve agreed don’t push the date back. A pure accounting accrual does not trigger withholding if you have no liability to pay yet.
Example (illustration only). ABC Pte Ltd receives an invoice from a non-resident dated 10 March for a payment that is subject to withholding tax. ABC plans to pay it in June. The invoice has no due date, so the invoice date is the deemed payment date. The tax is due by 15 May, the 15th of the second month after March, even though ABC hasn’t paid the vendor. If the withheld tax was S$3,000 and ABC pays it late, the initial penalty is 5%, or S$150, with more added if it stays unpaid. Check how your contract and invoices are dated before you agree payment terms.
The deadline and penalties
The tax is due to the Comptroller by the 15th of the second month after the date of payment. If it isn’t received by then, a 5% penalty applies. If it stays unpaid 30 days after the due date, a further 1% may be added for each completed month, up to 15% of the unpaid tax in total.
How we help
We work through a payment before it’s made, not after.
- Review the transaction and contract to decide whether the payment is subject to withholding tax, and at what rate.
- Work out the amount and the due date, including the date of payment.
- Prepare and file Form S45 through myTax Portal. IRAS requires a person authorised as an Approver through Corppass to submit, so we agree with you who approves.
- Claim treaty relief where the payee’s country has a double taxation agreement with Singapore and the conditions are met.
- Keep a record of each payment, calculation and filing, so you can answer an IRAS query quickly.
- Review overseas vendor contracts on a regular schedule, if you’d like us to do that monthly.
If a filing has already gone wrong, we can help you correct it. IRAS allows online amendments within two back years, and refunds are possible where tax was borne by the payer.
Who this is for
- Companies paying overseas developers, agencies, consultants or SaaS providers
- Companies with loans from foreign shareholders or related parties
- Companies renting equipment from overseas
- Companies paying non-resident directors
- Growing businesses whose payments abroad have outgrown what a bookkeeper tracks
Questions we get asked
Do I withhold tax on every payment to an overseas vendor? No. Only on the types of payment IRAS specifies. Many purchases of goods and many services performed entirely overseas are not subject to it. The answer depends on what the payment is for and where the work is done.
My contract is with an overseas company that has no office here. Does that matter? It’s the other way round: withholding tax exists precisely for payments to non-residents. Having no Singapore office does not take a payment outside the rules.
Does a tax treaty remove the tax? It can reduce the rate, or remove it for some payments. It depends on the treaty and the type of payment, and the conditions need to be met.
We’ve already paid without withholding. What now? Tell us the dates and amounts. The sooner it’s reviewed, the smaller any penalty. We’ll tell you what the position is and what can be done.
Who signs the filing? A staff member or tax agent authorised as an Approver through Corppass, or the sole proprietor.
Talk to us
Tell us what you pay overseas and to whom. We’ll tell you whether it’s within the rules and what it would take to file. Talk to us about an overseas payment.
Related: corporate tax, certificate of residence and GST services.
Sources
- IRAS, Determining the date of payment or deemed payment for withholding tax (e-Tax Guide)
- IRAS, Frequently asked questions on online filing of Section 45 withholding tax
- IRAS, Types of payment and withholding tax rates
This page is general information as at the date above, not legal, regulatory or professional advice. Rates and rules change, so please take advice on your own circumstances before acting.