Tax on income varies depending on respective income or profits. It can also varies depending on the type of characteristic of the taxpayer, as well as tax laws of a country. The following is a comparison of the effective tax on income in Singapore, India, Indonesia and Malaysia with the relevant options and benefits.
Singapore
The tax year in Singapore runs from 1st January to 31st December, and income is assessed on a preceding year basis. The tax system adopts progressive personal tax rates that are relative to the amount of income as follows:
Taxable Income ($) | Rate | Gross Tax Payable ($) |
First 20,000 Next 10,000 | 0 2 | 0 200 |
First 30,000 Next 10,000 | – 3.5 | 200 350 |
First 40,000 Next 40,00 | – 7 | 550 2,800 |
First 80,000 Next 40,000 | – 11.5 | 3,350 4,600 |
First 120,00 Next 40,00 | – 15 | 7,950 6,000 |
First 160,000 Next 40,000 | – 18 | 13,950 7,200 |
First 200,000 Next 40,000 | – 19 | 21,250 7,600 |
First 240,000 Next 40,000 | – 20 | 28,750 7,800 |
First 280,000 Next 40,000 | 36,550 8,000 | |
First 320,000 Excess of 320,000 | – 22 | 44,550 |
For citizens with overseas employment for more than six months in a calendar year, they can choose to be treated as non-residents for the year of assessment. Foreign income in Singapore is tax exempt under certain conditions.
Resident Individuals | Non-resident Individuals |
Tax is progressive | Taxed at 15% or respective progressive residential rate up to 22% |
Employment income is taxable | Local employment income of less than 60 days is tax exempt |
Subject to double tax reliefs | No double tax reliefs |
Subject to tax rebates | No tax rebates available |
| Reliefs available for children, dependents, etc. | No reliefs available |
India
Tax on Income in Indian comprises of the taxes that a Hindu Undivided Family (HUF) or an Individual or a taxpayer other than Companies are required to pay on income received. The rate of paying the tax is prescribed under the law. Every individual, whether resident or non-resident of India is subject to income tax. Taxable income is divided into five categories: 1. Income from salary, 2. Income (Interest or Dividends) from other sources like fixed deposits, income from shares, 3. Income from House property, 4. Income from Capital gains and 5. Income from business and profession.
Income for individuals in India is groups into blocks known as tax slabs or brackets (for the Assessment Year 2019-2020) :
Income Range | Rate of Tax | Tax to be paid |
0 – Rs. 2,50,000 | 0 | Not taxable |
Rs 2.5 lakhs – Rs 5 lakhs | 5% | 5% of the taxable income |
| Rs 5 lakhs – Rs 10 lakhs | 20% | Rs 12,5000 + 20% of the income above Rs 5 lakhs |
| Above 10 lakhs | 30% | Rs 1,12,500 + 30% of income above Rs 10 lakhs |
Indonesia
In Inodnesia, non-resident individuals, they are subject to a 20% withholding tax on income earned locally. For residents, almost all income is subject to tax on progressive rates. It includes employment income, passive income, income from business or independent profession, rents, and capital gains. An individual in Indonesia is regarded a tax resident if they live in Indonesia, has been in Indonesia during a fiscal year and intends to reside in country, or has been in Indonesia for 183 days or more during a period of past 12 months. The tax is collected through withholding by employers. The progressive tax rates for residents is as follows:
Individual Income Tax | Tax Rate |
0 – IDR 50 million | 5% |
IDR 50 million – IDR 250 million | 15% |
IDR 250 million – IDR 500 million | 25% |
| Above IDR 500 million | 30% |
Malaysia
Taxation in Malaysia is territorial whereby residents and non-resident are taxed for their income sourced local while foreign-sourced income is not taxed. For income sourced in Malaysia, non-resident individuals are taxed at a flat rate of 28% on table income. For resident individual, a progressive tax rate is applicable as follows:
| Income Range (MYR) | Tax on Column 1 (MYR) | Tax on excess |
5,000 – 20,000 | 0 | 1% |
| 20,000 – 35,000 | 150 | 3% |
35,000 – 50,000 | 600 | 8% |
50,000 – 70,000 | 1,800 | 14% |
70,000 – 100,000 | 4,600 | 21% |
| 100,000 – 250,000 | 10,900 | 24% |
250,000 – 400,000 | 46,900 | 24.5% |
400,000 – 600,000 | 83,650 | 25% |
600,000 – 1,000,000 | 133,650 | 26% |
Over 1,000,000 | 237,650 | 28% |
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