Tips On How To Manage Your Payroll In Singapore

  • Post category:Singapore

It can be difficult to manage the payroll when the company’s contributions in Singapore are increasing and the employee headcount is also rising. Managing the company’s Singapore payroll should be done with the highest accuracy and care, from processing and reporting payroll components to ensuring that they satisfy the Singapore regulatory requirements to computing and distributing payments.

Tips On How To Manage Your Payroll In Singapore

Refer to payroll outsourcing services Singapore for further information.

TIPS ON HOW TO MANAGE YOUR PAYROLL IN SINGAPORE

Paying monthly salary

Salaries must be paid by employers at least once each month or more frequently if they choose to do so. Salaries must be paid within 7 days of the end of the pay month; failure to do so is illegal.

Keeping employment records

Employers are required to maintain thorough records of their employees’ employment and pay for a period of two years. Records regarding an employee must be preserved for a year after they leave their job.

Excluding traveling, housing allowances

Basic pay and benefits are included in the salary. Pay for work performed under a service agreement is known as compensation or salary. In addition to not covering housing, food, or transport costs, it also excludes pensions, costs incurred while working, and

Compliance with statutory reporting requirements

Employers must electronically submit their employees’ income information to IRAS by the first of March each year if they have either (i) received notification to file their employment income electronically or (ii) had 10 or more individuals employed by them for the entire year.

Additionally, employers with international employees are required to file Form IR21, which requests tax clearance for those personnel, at least one month before the employee leaves Singapore for a period of three months or longer, begins an overseas posting, or terminates his job.

Calculating overtime pay

Any work completed outside of the regular working hours, excluding breaks, is considered overtime labor. A worker is restricted to 72 hours of overtime each month. The employer will be required to pay at least 1.5 times the hourly base rate of pay for overtime work. After the wage period’s end day, payment must be given within 14 days.

Keep in mind legal requirements, necessary levies, and payments

In addition to CPF contributions, employers are required to make the following monthly contributions:

  • Ethnic groups like CDAC, ECF, MBMF, and SINDA that work to help the underprivileged in their particular ethnic communities;
  • When the employer sends their staff for training, the Skills Development Levy provides them with training grants;
  • National Servicemen are required to pay CPF payments even if they regularly attend NS training. However, employers are not required to pay NS men for the days they are gone.
  • When hiring foreign nationals with work permits or S Passes, employers are also required to pay monthly fees for each hire.

MISTAKES TO AVOID WHILE MANAGING PAYROLL IN SINGAPORE

Not keeping accurate employee data

Maintaining an up-to-date employee database is essential for every business’s accurate data processing. An incorrect employee account number or any change to the employee’s record, such as a change in name or address, that is not immediately reflected in the database can result in expensive errors that may take a long time to fix and ultimately cause confusion among employees.

Irregular salary payment schedule

If the applicant wants their employees to remain satisfied with their current positions and work for them, boosting their morale is crucial. To prevent unnecessary confusion and problems with the employees’ expense plans or GIRO arrangements, it is equally important to make sure that your payroll management system will meet deadlines, perform accurate calculations, pay out the employees’ salaries, and distribute CPF on time.

Compromising sensitive employee data

Employees’ salaries, service agreements, employment benefits, and other personal information should all be kept completely private. However, there is a chance that this private employee information will be shared and made available to undesirable individuals if the human element or internal staff are involved in the payroll processing.

Inexperienced payroll staff 

Some businesses in Singapore opt not to invest in payroll software or in the outsourcing of payroll management to save money and expenses.  Unfortunately, the human factor in payroll processing systems (or any management system, for that matter) frequently leads to expensive mistakes like miscalculations and non-standard computing operations. It might take a lot of time and effort to fix even one small error.

Reach out to us at Relin Consultants – Leading Global Business Set Up Partners for further assistance with our payroll management services in Singapore.