Not Ordinarily Resident (NOR) Scheme

Not Ordinarily Resident Scheme

The NOR taxpayer scheme was introduced in the Budget Statement of 2002. This scheme provides tax privileges to eligible individuals for a term of 5 YAs (Year of Assessment). With the Not Ordinarily Resident Scheme, you will qualify for benefits like time apportionment on income derived from your employment and tax exemption on employer contributions that were made to a pension fund (overseas) for 5 continuous years.

Eligibility Requirement to Qualify for NOR Scheme

  • First and foremost you need to apply for the “Not Ordinarily Resident” status.
  • You’ll be eligible for the “Not Ordinarily Resident” status if you have been a non-resident for 3 YAs (Year of Assessment) that has passed. Also, in the Year of Assessment during which you become eligible for the “Not Ordinarily Resident” status, you should be a Singapore tax resident.

On meeting the required eligibility criteria, you’ll be given the “NOR” status for 5 continuous Years of Assessment (beginning from the Year of Assessment during which you met the criteria initially). Soon after the 5-year eligible period ends, your NOR status will expire. You will have to apply for the NOR status again by meeting the eligibility criteria afresh.

When you’re being considered for the NOR status for the next 5-year period, for you to meet the condition of being a non-resident for 3 YAs, all Years of Assessment during which you were a non-resident will be taken into account. This includes any such Year of Assessment that might come under the prior 5-year eligible period during which you had the NOR status.

Tax Deductions Under Not Ordinarily Resident Scheme

Time Apportionment of Employment Income Derived From Singapore

When you’re a resident Singapore worker, part of your income pertaining to your employment in Singapore will not fall under the “taxable” category for the number of days you spent out of Singapore for employment-related purposes.

What you need to do to enjoy this tax concession?

  • For a minimum of 90 days you should have stayed out of Singapore for employment-related reasons, and
  • Your complete income with respect to your Singapore employment should be a minimum of S$160,000. In case the tax you need to pay on the partitioned income is below 10% of your complete employment income, you’ll still be liable to pay 10% tax of your employment income in total.

What kind of income will not be considered for tax concession?

  • Director's fees.
  • Any income tax amount that needs to be paid in Singapore borne directly/indirectly by your employment firm.

How are the number of days you spent out of Singapore calculated?

When you’re present in Singapore during any part of the day, it will be considered as a day spent by you in Singapore. On the other hand, as a part of the administrative concession, you will have a chance to count your arrival day in Singapore as the only day you were present in Singapore. The day you depart from Singapore will be considered as a day you spent out of Singapore.

In case you made an exit from Singapore and came back on the same day, this day will be referred to as a day you spent in Singapore. With the help of the “NOR travel calculator”, you can calculate the number of days you spent out of Singapore.

Tax Deduction on Employer’s Contribution to Overseas Social Security Scheme or Pension Fund (Non-Mandatory)

If you’re a resident Singapore worker, based on this scheme you’ll be approved with tax exemption for a contribution your employer makes to any non-mandatory overseas Social Security Scheme or a pension fund. Also, you’ll be exempted from paying tax only when your employment firm decides to not claim any kind of a deduction on the contribution made. A cap will be applicable on the tax exemption amount you’ll be granted with.

qualifying conditions

  • You should not be a Permanent Resident or a Singapore citizen, and
  • Your income pertaining to your employment in Singapore should be a minimum of S$160,000, and
  • Your employment company should not raise any deduction claim for a contribution that was made to non-mandatory overseas provident or pension funds & any social security scheme up to the NOR cap.

In case your employer has not recharged or charged the contribution to a Singapore entity, you’ll not qualify for the tax concession on a contribution that was done by your company on or post 1 January 2014.

NOR Calculator

It is calculated depending on the total contribution made by the employer to an authorised mandatory/non-mandatory contribution scheme (overseas) or to both. The calculation will be made depending on the capping rules of the Central Provident Fund as if the contribution was made by the employer to the CPF account of a Singapore citizen as applicable under the Central Provident Fund Act.

Download Not Ordinary Resident Calculator

How to Apply for the Not Ordinarily Resident Scheme

  1. You can submit the following documents to IRAS within 15th April of the Year of Assessment during which you became eligible for the tax concessions or/and scheme.
    • NOR Scheme application form.
    • Form IR8A/Appendix 8A/8B
    • Appendices and
    • Your annual tax return
  2. You can also e-File your TR (tax return) and submit your application along with it to IRAS within 18th April of that Year of Assessment.

You will not qualify for tax concession if you do not submit your application form within the specified timeline.

Points to Remember when Submitting for NOR Appendices A & B

  • An authorised worker of the organisation needs to certify the NOR Appendices A and B you submit.
  • In case you’re the authorised signatory of the organisation and you’re applying for the NOR tax concession, your NOR Appendices A and B need to be certified by a different personnel from the organisation.

What happens when you submit an NOR Scheme application form late?

When you submit your application for the NOR status after the due date, your submission will be reviewed only for the NOR status. You’ll not qualify for any kind of tax concession(s) for the respective Years of Assessment.

Below are a few examples for your quick reference:

Date of Filing Tax Return NOR Status you Applied NOR Concessions you Applied NOR Status Approved NOR Concession Approved
8 September 2016 YA 2016 to 2020 YA 2016 YA 2016 to 2020 Not eligible for concession
13 April 2017 YA 2016 to 2020 YA 2016 & 2017 YA 2016 to 2020 YA 2017

In order to enjoy all the benefits offered under this scheme, file for your NOR status within the deadlines applicable for e-filing and paper filing.

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