{"id":7026,"date":"2021-05-21T08:53:32","date_gmt":"2021-05-21T00:53:32","guid":{"rendered":"https:\/\/dollarsandsense.sg\/business\/?p=7026"},"modified":"2021-05-21T08:53:33","modified_gmt":"2021-05-21T00:53:33","slug":"foreign-worker-levy-rebates-in-singapore","status":"publish","type":"post","link":"https:\/\/dollarsandsense.sg\/business\/foreign-worker-levy-rebates-in-singapore\/","title":{"rendered":"Foreign Worker Levy Rebates In Singapore: How Much Businesses Can Expect To Receive In 2021"},"content":{"rendered":"\n<p>With a small population, Singapore relies on a relatively large foreign workforce to support, diversify and bring new skillsets into our economy. As at December 2020, the&nbsp;<a href=\"https:\/\/www.mom.gov.sg\/documents-and-publications\/foreign-workforce-numbers\">foreign workforce in Singapore numbered about 1.2 million<\/a>. While it might seem like a huge number, it was already a decline from 2019 \u2013 when the total number of foreigners working here stood at over 1.4 million.<\/p>\n\n\n\n<p>There could be several reasons for the dwindling numbers in 2020:&nbsp;<\/p>\n\n\n\n<ul><li>Restricted border movements in 2020 (and 2021) due COVID-19.&nbsp;<\/li><li>Increasing unemployment rate in Singapore, possibly leading to less foreigners required to fill certain job vacancies.<\/li><li>Generous salary support for local businesses to hire locals.<\/li><li><a href=\"https:\/\/dollarsandsense.sg\/business\/companies-most-affected-latest-changes-employment-pass-s-pass\/\">Increased salary requirements for foreign professionals<\/a>&nbsp;and tightened foreign worker quota in recent years \u2013 with the latest coming during Budget 2021.<\/li><\/ul>\n\n\n\n<p><strong><em>Read Also:&nbsp;<\/em><\/strong><a href=\"https:\/\/dollarsandsense.sg\/business\/foreign-worker-quota-in-singapore-what-is-it-and-how-to-calculate-it-for-your-business\/\"><strong><em>Foreign Worker Quota In Singapore: What Is It And How To Calculate It For Your Business<\/em><\/strong><\/a><\/p>\n\n\n\n<p>Nevertheless, the Singapore government has to also support businesses that hire foreigners in Singapore. Some of these businesses are within important sectors including construction, marine and process, as well as in F&amp;B, retail and many others.<\/p>\n\n\n\n<p>On the back of this, the government has announced higher Foreign Worker Levy rebates for business in hard-hit sectors, including Construction, Marine Shipyard and Process Sectors, to help them tide through this difficult period.<\/p>\n\n\n\n<h3 id=\"what-is-the-foreign-worker-levy\"><strong>What Is The Foreign Worker Levy?<\/strong><\/h3>\n\n\n\n<p>The Foreign Worker Levy is an additional payment that businesses have to pay in order to hire a foreigner in Singapore. According to the Ministry of Manpower (MOM), it acts as a pricing mechanism to&nbsp;<strong>regulate the number of foreign workers<\/strong>&nbsp;in Singapore.<\/p>\n\n\n\n<p>Foreign Worker Levy only applies to Work Permit and S Pass Holders, but not employees under Employment Pass (EP).<\/p>\n\n\n\n<p>When hiring a foreign employee, businesses are&nbsp;<strong>not required to pay CPF contributions<\/strong>, which can be as high 17% of their salary in Singapore. However, a&nbsp;<strong>monthly foreign worker levy<\/strong>&nbsp;must be paid. The levy liability starts from the day the Temporary Work Permit or Work Permit is issued, whichever is earlier, and ends when the permit is cancelled or expires.<\/p>\n\n\n\n<h3 id=\"foreign-worker-levy-differs-from-sector-to-sector\"><strong>Foreign Worker Levy Differs From Sector To Sector<\/strong><\/h3>\n\n\n\n<p>The amount of foreign worker levy an employer needs to pay generally depends on four factors:&nbsp;<\/p>\n\n\n\n<ul><li>Are you hiring a work permit holder or an S Pass holder?<\/li><li>The foreign worker\u2019s qualifications: businesses pay less foreign worker levy for higher-skilled workers&nbsp;<\/li><li>The number of Work Permit or S Pass holders hired in the company: businesses with a larger proportion of their headcount filled by foreign workers have to pay a higher foreign worker levy<\/li><li>The sector that your business is operating in \u2013 depending on the sector you operate in, you have to pay a different foreign worker levy<\/li><\/ul>\n\n\n\n<p>For easier reference, here\u2019s a collation of the amount of monthly levy businesses in each sector has to pay for each foreign worker hired.<\/p>\n\n\n\n<h3 id=\"foreign-worker-levy-for-work-permit-holders\"><strong>Foreign Worker Levy For Work Permit Holders<\/strong><\/h3>\n\n\n\n<table class=\"wp-block-table\"><tbody><tr><td><strong>Sector<\/strong><\/td><td><strong>Basic-Skilled Worker (Monthly)<\/strong><\/td><td><strong>Higher-Skilled Worker (Monthly)<\/strong><\/td><\/tr><tr><td>Construction<\/td><td>$700 \u2013 Malaysians and North Asian sources (NAS); Non-Traditional Sources (NTS) and People\u2019s Republic of China (PRC) on Man-year Entitlement (MYE)<br><br>$950 \u2013 NTS and PRC, MYE waiver<\/td><td>$300 \u2013 Malaysians and North Asian sources (NAS); NTS and PRC on MYE<br><br>$600 \u2013 NTS and PRC, MYE waiver<\/td><\/tr><tr><td>Manufacturing<\/td><td>$370 \u2013 Tier 1 (up to 25% of total workforce)<br><br>$470 \u2013 Tier 2 (above 25% to 50% of total workforce)<br><br>$650 \u2013 Tier 3 (above 50% to 60% of total workforce)<\/td><td>$250 \u2013 Tier 1 (up to 25% of total workforce)<br><br>$350 \u2013 Tier 2 (above 25% to 50% of total workforce)<br><br>$550 \u2013 Tier 3 (above 50% to 60% of total workforce)<\/td><\/tr><tr><td>Marine Shipyard<\/td><td>$400<\/td><td>$300<\/td><\/tr><tr><td>Process<\/td><td>$450 \u2013 on MYE<br><br>$750 \u2013 on MYE waiver<\/td><td>$300 \u2013 on MYE<br><br>$600 \u2013 on MYE waiver<\/td><\/tr><tr><td>Services<\/td><td>$450 \u2013 Tier 1 (up to 10% of total workforce)<br><br>$600 \u2013 Tier 2 (above 10% to 25% of total workforce)<br><br>$800 \u2013 Tier 3 (above 25% to 50% of total workforce)<\/td><td>$300 \u2013 Tier 1 (up to 10% of total workforce)<br><br>$400 \u2013 Tier 2 (above 10% to 25% of total workforce)<br><br>$600 \u2013 Tier 3 (above 25% to 50% of total workforce)<\/td><\/tr><\/tbody><\/table>\n\n\n\n<p>According to MOM, employers pay a lower levy fee when hiring a higher skilled worker. They also pay a higher levy per foreign worker with the increase in number of foreign labour hired.<\/p>\n\n\n\n<h3 id=\"foreign-worker-levy-for-s-pass-holders\"><strong>Foreign Worker Levy For S Pass Holders<\/strong><\/h3>\n\n\n\n<p>Under the existing quota, the number of S Pass holders a company can hire is capped at:<\/p>\n\n\n\n<ul><li>10% of the company\u2019s total workforce in the services sector<\/li><li>20% in the manufacturing sector<\/li><li>18% in all other sectors<\/li><\/ul>\n\n\n\n<p>Here\u2019s a collation of the monthly foreign worker levy that businesses in each sector has to pay for each S Pass holder they hire.<\/p>\n\n\n\n<table class=\"wp-block-table\"><tbody><tr><td><strong>Sector<\/strong><\/td><td><strong>&nbsp;Levy Rate (Monthly)<\/strong><\/td><\/tr><tr><td>Services<\/td><td>$330 \u2013 Tier 1 (Up to 10% of total workforce)<\/td><\/tr><tr><td>Manufacturing<\/td><td>$330 \u2013 Tier 1 (Up to 10% of total workforce)<br><br>$650 \u2013 Tier 2 (Above 10% to 20% of total workforce)<\/td><\/tr><tr><td>All Other Sectors (Excluding Services and Manufacturing)<\/td><td>$330 \u2013 Tier 1 (Up to 10% of total workforce)<br><br>$650 \u2013 Tier 2 (Above 10% to 18% of total workforce)<\/td><\/tr><\/tbody><\/table>\n\n\n\n<h3 id=\"recent-foreign-worker-levy-rebates\"><strong>Recent Foreign Worker Levy Rebates<\/strong><\/h3>\n\n\n\n<p>Due to COVID-19 downturn in 2020, a total of 3 rounds of foreign worker levy rebates was announced between 6 April and 26 May 2020.<\/p>\n\n\n\n<p>During the Solidarity Budget announced on 6 April 2020, a foreign worker levy rebate was provided to help affected businesses upkeep and care for their foreign workers during circuit breaker, the government provided employers with a&nbsp;<strong>Foreign Worker Levy rebate of $750 for each work permit or S Pass holder<\/strong>.&nbsp;<\/p>\n\n\n\n<p>In the first two rounds, employers who had paid up to December 2019\u2019s foreign workers\u2019 levy in full, were eligible for a flat rate of $750 for each S Pass or Work Permit holder under their employment as at 29 February 2020 (round 1) \/ 1 May 2020 (round 2).&nbsp;<\/p>\n\n\n\n<p>In the 3<sup>rd<\/sup>&nbsp;round of levy rebate, a flat rate of $750 in June 2020 and $375 in July for each S Pass or Work Permit holder under employment as at 1 June 2020 and 1 July 2020, were provided to businesses in the Construction, Marine Shipyard and Process sectors; and businesses that were not in MTI\u2019s permitted list to resume operations.<\/p>\n\n\n\n<h3 id=\"enhanced-foreign-worker-levy-rebates-provided-to-harder-hit-sectors-in-2021-construction-marine-shipyard-and-process-sectors\"><strong>Enhanced Foreign Worker Levy Rebates Provided To Harder Hit Sectors In 2021 \u2013 Construction, Marine Shipyard and Process Sectors<\/strong><\/h3>\n\n\n\n<p>On 8 May 2021, MOM announced that businesses in the Construction, Marine Shipyard and Process (CMP) sectors will be receiving a higher Foreign Worker Levy (FWL) rebate for each Work Permit Holder \u2013 from $90 per month to $250 per month from May to December 2021.<\/p>\n\n\n\n<p>MOM advises employers to make use of the FWL rebate to retain existing workers and bring in Work Permit Holders from lower-risk countries or regions.<\/p>\n\n\n\n<p>Eligible employers may head to MOM\u2019s&nbsp;<a href=\"https:\/\/form.gov.sg\/#!\/5e96c3c90809d700111b8a61\">website<\/a>&nbsp;to check the amount of levy rebate they will receive.<\/p>\n\n\n\n<h3 id=\"when-can-employers-expect-to-receive-foreign-worker-levy-rebates\"><strong>When Can Employers Expect To Receive Foreign Worker Levy Rebates?<\/strong><\/h3>\n\n\n\n<p>Each month\u2019s rebate will be processed and credited to eligible employers on the following month. For instance, the levy rebate for June 2021 will be credited to the employer via PayNow Corporate in July 2021 or via cheque by August 2021.<\/p>\n","protected":false},"excerpt":{"rendered":"Foreign Worker Levy rebates for the Construction, Marine Shipyard and Process sectors will be increased to $250 per month.\n","protected":false},"author":18,"featured_media":7027,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[95],"tags":[1004,905,210,380,379],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v16.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Foreign Worker Levy Rebates In Singapore: How Much Businesses Can Expect To Receive In 2021 | DollarsAndSense Business<\/title>\n<meta name=\"description\" content=\"From May to December 2021, businesses in the Construction, Marine Shipyard and Process sectors will receive higher Foreign Worker Levy rebates.\" \/>\n<meta name=\"robots\" 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