u.s. expat tax guide – singapore
How do I report rental income in Singapore as a US expat?
If you’re an American living or working in Singapore and you rent out a property there, you have to follow two sets of tax rules—Singapore’s and the United States’. Singapore will want you to report income from your rental under its own laws, and the US taxes your worldwide income even if you live overseas.
You might be wondering:
- Do I need to report it to the IRS?
- Will I have to pay US taxes on it?
- Are there penalties if I’ve been filing incorrectly?
The short answer is yes, you must report your rental income to the IRS. However, there are deductions and credits that can help reduce your tax liability.
US expats must report foreign rental income on Schedule E of their Form 1040, which includes:
- Total rental income earned
- Property expenses (such as maintenance, mortgage interest, and taxes)
- Net profit or loss from the rental
What many expats don’t realize is that they also need to file Form 8858, a newer IRS requirement. Failing to include this form can result in a US$10,000 penalty per year. Since this requirement was introduced around 2021, many taxpayers are unaware of it.
If you’ve been filing taxes without Form 8858, there is a way to correct it. The Streamlined Filing Compliance Procedures allow you to:
- Catch up on three years of missed tax returns
- Submit six years of foreign bank reports (FBARs)
- Avoid penalties by certifying that the mistake was unintentional
How can US expats avoid double taxation on rental income?
Because the US requires you to report global income, you can end up paying tax on your Singapore rental profits to both countries. You typically prevent this by using:
- Foreign Tax Credit (FTC)
- You claim a dollar-for-dollar credit (on Form 1116) for taxes paid to Singapore’s Inland Revenue Authority (IRAS).
- This credit lowers or cancels out the US tax owed on the same rental income.
- Foreign Earned Income Exclusion (FEIE)
- Primarily for salary or self-employment income, not passive rental profits.
- Usually not as relevant for rent unless you structure your property in a special way.
- No Comprehensive US–Singapore Tax Treaty
- Some countries have treaties letting you bypass double taxation on passive income.
- Singapore does not, so you rely on the FTC or other US provisions.
- Property-Related Levies
- Items like Additional Buyer’s Stamp Duty (ABSD) may reduce your Singapore net income, but they generally are not considered “income tax” for US credit purposes.
Do US expats need to report Foreign Bank Accounts (FBAR)?
Many landlords open a local bank account to collect rent or pay expenses. If your combined foreign account balances ever exceed US$10,000 at any point in the year:
- You must file an FBAR (Foreign Bank Account Report), also known as FinCEN Form 114.
- You submit it electronically, separate from your tax return.
- Penalties for failing to file can be steep, even if you owe no US tax.
Additionally, you might need to file Form 8938 (Statement of Specified Foreign Financial Assets) if your overseas accounts or assets surpass higher thresholds under FATCA. That means you should:
- Watch your bank balances throughout the year, including any security deposits or advance rent.
- Keep track of all foreign investments (including bank accounts, stock holdings, and more) to see if you meet Form 8938 limits.
What is Singapore’s tax system?
Singapore’s tax system is managed by the Inland Revenue Authority of Singapore (IRAS), which oversees tax collection and enforcement.
The tax year follows the calendar year (January 1 – December 31), and income is taxed on a territorial basis—meaning only income earned in Singapore (or brought into Singapore) is taxable.
Unlike the US, which taxes citizens on worldwide income, Singapore generally does not tax foreign income unless it is remitted into the country.
Tax Rates for Individuals
Singapore uses a progressive tax system, meaning the more you earn, the higher your tax rate. The rates start at 0% for lower incomes and go up to 22% for the highest earners. However, non-residents—such as expats staying in Singapore for fewer than 183 days in a year—are usually taxed at a flat rate of 15% or 22%, depending on income type.
Tax season in Singapore starts March 1, and tax returns must be submitted by April 15 (or April 18 if filing online). Singapore encourages e-filing through the myTax Portal, making the process faster and more convenient.
Here are the key tax forms you may encounter:
- Form B1 – The standard tax form for residents earning employment income.
- Form B – For residents with self-employment or business income.
- Form M – For non-residents (expats staying in Singapore less than 183 days).
- Form IR8A – Not a tax return, but an income statement provided by employers.
After filing, IRAS will send a Notice of Assessment (NOA), which is your official tax bill. If you disagree with the assessment, you can file an objection within a set period. Otherwise, payment must be made by the due date.
As a US citizen or Green Card holder, you are required to file taxes in both Singapore and the United States. Since the US taxes worldwide income, this means you could be taxed twice on the same earnings. Unfortunately, there is no tax treaty between the US and Singapore to prevent this completely.
However, the Foreign Earned Income Exclusion (FEIE) and Foreign Tax Credit (FTC) can help.
- FEIE (Form 2555) allows you to exclude up to a set amount (~$126,500 for 2024) of your foreign income from US tax.
- FTC (Form 1116) gives you tax credits for taxes paid to Singapore, reducing what you owe in the US.
To stay compliant, US expats must file both their Singapore tax return by April and their US tax return by April 15 (or June 15 with the expat extension).
Singapore’s Corporate Tax Rate
For those running a business, Singapore has one of the lowest corporate tax rates in the world—a flat 17% on taxable profits. Unlike the US, Singapore does not have a double taxation system for businesses, meaning once a company pays tax, the profits distributed to shareholders are not taxed again.
Companies must submit their corporate tax return (Form C-S or Form C) by November 30 each year. Some businesses also need to file an Estimated Chargeable Income (ECI) shortly after the end of their financial year.
CPF Contributions and Tax Implications
The Central Provident Fund (CPF) is Singapore’s social security system. It requires both employees and employers to contribute a percentage of salary for retirement and healthcare savings.
For Singaporeans and Permanent Residents (PRs), CPF contributions are not taxed and even offer tax relief. However, foreigners (including US expats) generally do not contribute to CPF, unless they obtain PR status.
Stamp Duties and Other Taxes
Besides income tax, Singapore has other tax obligations, such as stamp duties on property transactions:
- Buyer’s Stamp Duty (BSD) applies when purchasing property.
- Additional Buyer’s Stamp Duty (ABSD) is an extra charge for foreigners buying residential property.
- Seller’s Stamp Duty (SSD) applies if you sell property within a short period.
Singapore also has a Goods and Services Tax (GST), which is similar to a sales tax. The rate is currently 9%.
What tax benefits are available for US expats with rental income?
Since the US taxes its citizens on all worldwide income, including Singapore rent, you may owe tax twice on the same money if you aren’t careful.
Fortunately, several tax benefits can help reduce or eliminate double taxation:
- Foreign Tax Credit (FTC)
- Primary Method for Rental Income: Rental income is considered “passive” by the IRS. The Foreign Tax Credit (filed on Form 1116) is usually your go-to for offsetting US tax by the amount of Singapore tax already paid on your rent.
- Works Without a Tax Treaty: Even though the US and Singapore don’t have a full tax treaty for individuals, the FTC still applies.
- Foreign Earned Income Exclusion (FEIE)
- 2024 Amount: For 2024, you can exclude up to US$126,500 of earned income if you meet certain tests (Physical Presence or Bona Fide Residence).
- Not for Rental Profits: Because rental income is passive, the FEIE typically does not apply to it. However, if you also have a job in Singapore, the FEIE can help exclude your salary.
- Foreign Housing Exclusion
- Lowering Housing Costs: This exclusion allows certain expats to deduct or exclude housing expenses.
- Applies to Personal Housing, Not Rented-Out Property: It doesn’t reduce taxes on rental profits you earn from tenants.
- Refundable Additional Child Tax Credit
- Up to US$1,700 per Child (2024): The exact amount can change annually, but this credit provides a refundable boost for expats with children.
- Helps Overall US Tax Bill: Even though it’s not tied to rental income directly, it can offset or reduce your total US tax if you qualify.
- Capital Gains Differences
- Singapore Doesn’t Tax Capital Gains: If you sell your property at a profit, Singapore likely won’t tax that gain.
- US Taxes Gains: The US taxes capital gains, often at lower rates if it’s a long-term asset. This is separate from your rental income but is worth noting if you plan to sell.
- Streamlined Filing Compliance Procedures
- Late Filers’ Safety Net: If you discover you’ve missed reporting foreign income or assets in prior years, you can catch up under these procedures with fewer penalties, assuming it wasn’t willful neglect.
- Self-Employed Expats
- Double Social Security: Without a totalization agreement between Singapore and the US, self-employed individuals could owe into both countries’ systems.
- Business Deductions: If you operate a side business or consulting service in Singapore, you can claim certain business expenses, but that typically won’t affect your “passive” rental profits.
For rental income, the Foreign Tax Credit is usually your main way to avoid double taxation. If you also have wages or self-employment earnings, you might layer in the Foreign Earned Income Exclusion and other benefits to reduce your overall US tax.
What else should I know?
- No Comprehensive US–Singapore Individual Tax Treaty: You rely on standard US laws (FTC, FEIE) instead of a treaty to prevent double taxation.
- Capital Gains: Singapore does not typically tax gains on property sales, but the US does.
- Deductions and Allowances: Both countries have deductions, but they’re structured differently. US expats can take itemized deductions or a standard deduction on their US return, whereas Singapore uses personal reliefs that don’t directly translate to US tax savings.
Claim every eligible deduction on your foreign rental. Consult a tax professional today.
How does tax residency in Singapore affect rental income taxes?
Your tax residency status in Singapore can change how you’re taxed on most types of income. Generally, the Inland Revenue Authority of Singapore (IRAS) looks at the number of days you spend in the country, whether you’ve obtained permanent residency, and other factors.
- Resident vs. Non-Resident Tax Rates
- If IRAS classifies you as a tax resident (commonly by staying 183 days or more in a calendar year), local income is taxed under a progressive rate system.
- Non-residents often face a flat tax on employment income or the resident rates—whichever is higher.
- For rental income from Singaporean property, the rate is typically the same for residents and non-residents. You declare this on your annual tax return, pay in Singapore dollars (SGD), and receive a Notice of Assessment (NOA) showing what’s due.
- Permanent Residency Status and Local Reliefs
- If you become a Singapore permanent resident, you’ll pay into the Central Provident Fund (CPF) and may qualify for other local benefits or retirement schemes like the Supplementary Retirement Scheme (SRS). That doesn’t typically affect how your rent gets taxed, but it can matter for other income or tax relief.
- Connection to US Residency Tests
- You might see terms like the Bona Fide Residence Test or Physical Presence Test when dealing with US taxes (for the Foreign Earned Income Exclusion). However, rental income is generally considered passive, so these tests won’t usually lower US tax on Singapore rent.
What income Is taxable vs. non-taxable in Singapore?
Singapore follows a territorial tax system, meaning it mostly taxes income earned within its borders. That includes rent from a Singapore property.
- Taxable Rental Income
- You pay tax on your net rent—your total rent minus allowable costs like repairs, property tax, mortgage interest tied to the rental, and maintenance fees.
- If you rent to someone else while you live overseas, you’re still subject to Singapore taxation on those profits.
- Non-Taxable Income
- Capital Gains: If you later sell the property at a profit, Singapore usually won’t tax those gains. The US, however, may treat them as taxable capital gains.
- Foreign-Sourced Income: Singapore won’t tax what you earn outside Singapore if you keep it abroad. But this isn’t relevant to property physically located in Singapore (that income is local).
- Employment and Self-Employment Income
- If you also work in Singapore, that pay is taxed under different rules—often progressive rates for residents. Rental income is kept separate, but all of it gets reported on the same personal tax return (Form B or B1).
What taxes apply to rental properties in Singapore?
Beyond the standard income tax on net rental profits, you might run into other taxes or fees:
- Property Tax
- Charged yearly based on an “annual value” determined by IRAS.
- Non-owner-occupied homes (i.e., you’re not living there) often have higher property tax rates than owner-occupied ones.
- Stamp Duties
- Buyer’s Stamp Duty (BSD) and potentially Additional Buyer’s Stamp Duty (ABSD) if you’re not a Singapore citizen and you purchase more than one property.
- Stamp duties are transaction-based and don’t reduce US tax. They’re not considered income taxes, so they can’t be credited on your US return.
- Goods and Services Tax (GST)
- Typically doesn’t apply to standard residential rentals. Could matter if you rent out a commercial property or if your property is managed in a business-like format that exceeds GST registration thresholds.
- No Capital Gains Tax
- Singapore doesn’t usually tax profits from selling properties. The IRS, however, may. Keep that in mind if you plan to sell the property in the future.
What US tax filing requirements apply to rental income from Singapore?
Even though Singapore taxes your rental income, the US expects you to report all foreign earnings:
- Form 1040 and Schedule E
- Report your rental receipts and expenses on Schedule E (Supplemental Income and Loss). Attach it to your Form 1040.
- You may be able to deduct property expenses, depreciation, and other rental costs, just like you would for a US rental.
- Foreign Tax Credit (FTC)
- Because you pay Singapore tax on the rental profits, you can generally claim a Foreign Tax Credit on Form 1116. This credit reduces or erases your US tax on that same Singapore-sourced rent, preventing double taxation.
- FBAR and FATCA
- If your foreign bank accounts (where rent is deposited) exceed US$10,000 in total at any point, file an FBAR (FinCEN Form 114).
- If your assets surpass higher limits, file Form 8938 under FATCA guidelines.
- Non-Earned Income
- The Foreign Earned Income Exclusion (Form 2555) is designed for wages or self-employment income. Rental profits generally don’t qualify because the IRS considers them passive.
- Streamlined Filing Compliance Procedures
- If you’ve missed reporting or filing in prior years, you can often catch up with reduced penalties if your oversight was unintentional.
- US Expats’ Filing Deadlines
- You typically have until June 15 to file if you’re abroad on April 15, although any taxes owed start accruing interest after April 15.
How does the US-Singapore tax treaty affect rental income?
While some countries have tax treaties with the US that specifically address passive income (like rent), Singapore does not maintain a comprehensive personal income tax treaty with America.
- No Dedicated Treaty Relief
- There’s no special arrangement that lowers your US tax on rental profits.
- You’ll rely on Form 1116 to claim a credit for taxes paid to Singapore.
- Totalization Agreement
- The US and Singapore also lack a totalization agreement coordinating Social Security. This affects earned income, not passive rent, but is worth knowing if you also have a job in Singapore.
- Double Taxation
- You won’t be double-taxed if you properly apply the Foreign Tax Credit for the Singapore taxes paid on your rental income.
- In practical terms, you likely owe little to no extra US tax on the same rent after claiming the credit.
Ankurita Lala, an IRS Enrolled Agent with 6 years of expat tax experience, specializes in helping individuals and entrepreneurs navigate the complexities of foreign business ownership. *Schedule a consultation with Ankurita today.
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