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How Payroll Processing Services Work In Singapore

As an HR manager doing payroll in Singapore, you are responsible for ensuring that everyone is paid correctly and on time.  One mistake can jeopardise employee trust and the organisation’s reputation. Thus, payroll processing is a critical task that must be completed correctly and timely.

In Singapore, talent development and retention is very important. It has become part and parcel of hiring practices. It is important to know the legislation terms when it comes to payroll processing, including form submissions to the government.

Check out guidelines by MOM – https://www.mom.gov.sg/employment-practices/salary/paying-salary

After factoring in the variable sales commissions for payroll management, it's still important to ensure accurate salary information.

What Is Payroll

Payroll is a list of employees who receive compensation from the company. It also refers to the total amount of money paid to employees by the employer.

Payroll Management In Singapore

Payroll management in Singapore is usually handled by the HR and finance departments. HR ensures that all payroll documentation is correct and accurately processed, while the finance department ensures that all payments are made on time.

There is a legal requirement in Singapore that salaries must be paid at least once a month, and within 7 days of the next month. It is an offence if salary is not paid timely.

Employers are required to keep such records for all employees for two years. Ex-employee records must be kept for one year after they leave employment.

Payroll management in Singapore is heavily influenced by the size of the company. While large Singapore companies seek the specialised services of experts, small and medium-sized businesses will hire personnel to handle these procedures. If you require payroll services in Singapore, you can rely on our local accounting experts.

Examples Of Payroll

In Singapore, the payroll is calculated in the following formula:

[(Monthly gross rate of pay) / (Total number of working days** in that month)] x Total number of days the employee actually worked in that month.

However, you also have to take into account other liabilities to pay every month, such as the CPF and the contributions to various self help groups (by racial groups in Singapore) like Mendaki, CDAC, SINDA and Eurasian Association. Miscellaneous payroll would include IRAS submission, overtime pay, transport claims, sales commissions etc.

What are the Steps in Payroll Processing

 

Payroll processing in Singapore must be properly managed, even if it is simple and transparent, because it involves specific rules and regulations – and should take into account the status of resident and non-resident workers. If mishandled, it may result in discrepancies and inaccurate report data for income tax filing.

Payroll processing in Singapore necessitates contributions to social security schemes such as the CPF, the Skill Development Levy, and the Foreign Workers Levy; however, employers in Singapore are not required to make monthly withholdings.

Employers in Singapore typically process payroll while considering performance evaluation, year-end bonuses, medical leave, statutory claims, and other factors.

What Do I Need For Payroll

When you want to establish payroll for your employees in Singapore, you need these documents:

  • Full name
  • Date of birth
  • Date employed
  • Citizenship
  • Identification number
  • Current job start date
  • Self-help group contribution status
  • Bank account details
  • Salary amount

Payroll For Overtime Work In Singapore

A common question often arises about payroll calculation and policy in Singapore. Well, according to MOM law, overtime means doing excess work after normal working hours (excluding breaks) and employees can only work up to 72 hours monthly.

Overtime work will require you to pay at least 1.5 times the hourly basic rate. Payment must be made within 14 days of the end of the salary period.

How Jusixty Makes Payroll Singapore Easier For Employers

We all know that payroll processing and management can be very troublesome for employers and their HR staff to process. Every month, they not only have to go through the tedious calculation processes to count the salaries. They also have to ensure accuracy, along with the overtime pay, transport allowance, self help group contributions and even other payments like bonus and commissions. Not forgetting also the CPF contribution. Any disputes of accuracy may be liable for complaints to MOM and the companies guilty may be slapped on penalties.

Jusixty is able to make this easier for employers.