Foreign Worker Levy (FWL) is a mandatory scheme implemented by the Singaporean government. It is one of the payments employers are required to make for contract foreign workers. 

The Foreign Worker Levy is a pricing mechanism to regulate the number of foreign workers in Singapore.

As an employer, you do not have to pay Central Provision Fund (CPF) contributions for your Foreign Workers. However, monthly levy for Work Permit and S Pass holders with payment done via General Interbank Recurring Order (GIRO) is compulsory

The Levy you pay depends on two factors:

  • The worker's qualifications
  • Dependency ceiling (only applicable for manufacturing and services sectors).

Payment

Payment must be made via GIRO. Should you not have a GIRO account, you can apply for one using the GIRO Application Form. Your application status and start date of GIRO deduction can only be checked one month after your GIRO application.

After GIRO is approved,

  • The levy for each month will be deducted from your bank account on the 17th of the following month (or the next day if it falls on a weekend or public holiday).
    Note: e.g. the levy for January will be deducted on 17th February 2017
  • You should maintain enough funds in your account before the deduction date.

Levy bills can be viewed online on the 6th of every month.

If the full levy is not paid on time, you may face the following penalties:

  • a late payment penalty will be charged
  • existing Work Permits will be cancelled
  • you won't be allowed to apply for or issue Work Permits nor renew existing Work Permits
  • you may face legal action to recover the unpaid levy
  • if you, your partner(s) or director(s) head other companies, these companies will not be allowed to apply for Work Permits

Higher Skilled Worker Levy

You pay a lower levy for skilled foreign workers who have the necessary academic and skill-based quaifications, years of experience and salary. The levy rates that apply will depend on your sector.

To apply for higher skilled worker levy:

  1. Complete and sign the Application for Conversion to Higher Skilled Worker Levy
  2. Prepare these supporting documents:
  • Clear copies of the educational or test certificates
  • For certificates issued in China, a copy of the verification report and certificate of graduation. You can get the verification report from sources such as the China Higher Education Student Information and Career Centre
  • For diplomas or higher qualifications, a copy of the transcript or letter from the institution stating the course duration
  • Other supporting documents

3. Submit the relevant application and supporting documents using iSubmit. Under request type, choose option 9: Levy Matters

Levy Waiver

You can apply for a levy waiver if your foreign worker:

  • is on overseas leave for at least 70 consecutive days
    Note: Capped at 60 calendar days per calendar year
  • is on hospitalization leave issued by Singapore hospitals
    Note: Capped at 60 calendar days per calendar year
  • does not return to Singapore after overseas leave
  • is under police custody or is housed at the embassy
  • passed away
  • has become a Singapore permanent resident
  • is in the harbour-craft industry and is on board a vessel leaving Singapore's port for at least three consecutive days
  • is a Malaysian and is serving National Service in his home country (usually for three months)

Requirements

picture credits to Ministry of Manpower here

You can apply for the levy waiver only after the levy has been charged and it must be within one year of the levy bill.
Note: e.g. if the waiver period requested is from January 2015 (start month) to February 2015 (end month), you must submit the application by 31 January 2016.

Should you want to apply, you can go online and choose Application for Waiver of Foreign Worker Levy (Business).

If you had paid your levy amount in excess and you are no longer hiring any foreign worker, please submit an online refund application within one year from the date of payment.

Additional notes: Handling Payroll for Foreign Workers

If you're looking for how to handle payrolls with regards to foreigners on Payboy, click here.

If any of the above points are confusing to you or if you encounter any problems, feel free to contact Payboy Support at support@payboy.biz

For more information regarding FWL, click here

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