Employers need to report the yearly Employment Income (IR8A) of their employees to Inland Revenue Authority of Singapore or IRAS, in short. This form needs to be submitted by 1 Mar every year.
As I always say at the start of each new year, “Holiday season is over! Tax reporting season is here!”.This is especially true for the SME owners, HR or payroll practitioner who needs to compile and submit their employee income submission manually .
This year, I thought it is a good idea to share on the processes on the IR8A submission if you have been processing your payroll using MS Excel.
The IR8A form must be completed for ALL employees:
Full-time resident employee;
Part-time resident employee;
Company director (including a non-resident director);
Employee who has left the organisation but was in receipt of income in 2016 (e.g. stock options gains).
The only exclusion is for non-resident employees who have left in 2016 and the company has already filed IR21 for the employee.
Below is the recommended workflow.
Step 1: Consolidate Monthly Payroll to Yearly Figures
The basic assumption is that the company has been maintaining payroll records in MS Excel at the minimum. Create a new worksheet to consolidate the income and deductions that each employee has for the entire year.
Step 2: Consolidate Yearly Figures to IRAS items
After you have consolidated your payroll figures into annual figures, it is now time to look at how to map them to the actual IR8A form. Below is an extraction of IRAS definition of common income items.
For the full list of IR8A fields, click here to the IR8A explanatory notes.
There are 2 ways to submit to IRAS.
a. Manual Form to Employee (Only available for employers with less than 9 employees)
b. Auto Inclusion Scheme – For employers with 9 or more employees, IRAS requires the employers to submit the Employment Income on behalf of their employees. This can be done either with Singapore payroll software or online submission.
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