Singapore and the US: money questions in both directions
Anthony Walsh, founder of Selanis, grew up in Singapore from 2003 to 2010. The corridor between Singapore and the US is unusual: there is no comprehensive tax treaty, no Social Security totalization agreement, and the two systems sit at opposite ends — Singapore with no capital gains tax and little tax on foreign income, the US taxing its citizens and residents on everything. Americans in Singapore and Singaporeans in the US hit the same gap from opposite sides.
- No comprehensive US–Singapore income tax treaty — each side applies its own rules, with no treaty tie-breakers or reduced pension withholding.
- CPF and SRS are not US-qualified plans, so US tax and reporting can apply to money locked in Singapore.
- Nearly every Singapore fund is a PFIC for US taxpayers — the cheapest moment to deal with that is before US tax residency starts.
- Singaporeans holding US shares after moving home face US estate tax above $60,000, with no estate treaty.
Americans in Singapore
CPF, SRS, local funds and the missing treaty.
- Is there a tax treaty between the US and Singapore? — There is no comprehensive income tax treaty between the United States and Singapore, and no Social Security totalization agreement. Americans in Singapore rely on the Foreign Earned Income Exclusion and Foreign Tax Credit to avoid double tax, and Singaporeans in the US cannot use treaty tie-breakers or treaty pension rules.
- Is my CPF taxable in the US? — For US citizens and green card holders, CPF is not a US-qualified retirement plan, so US tax may apply to employer contributions and to growth inside the accounts even though the money is locked until later life. There is no treaty to override this, so the reporting position should be chosen deliberately with a US tax preparer.
- Are Singapore unit trusts, SGX ETFs and robo-advisers PFICs? — Yes. Almost every non-US pooled investment available in Singapore — unit trusts, SGX-listed ETFs, investment-linked policies and robo-adviser portfolios built from non-US funds — is a Passive Foreign Investment Company for US taxpayers. Each requires Form 8621 and, by default, punitive tax on gains. US taxpayers generally hold US-domiciled funds instead.
- Should an American in Singapore contribute to SRS? — SRS contributions reduce Singapore income tax, but the IRS does not recognise the deferral: contributions do not reduce US taxable income and growth inside SRS can be taxed by the US annually. For many Americans the Singapore saving is small relative to the US complexity, especially if the money would be invested in PFIC funds.
Singaporeans in the US
Becoming a US taxpayer, CPF, property, and moving home.
- I'm Singaporean, working in the US — what do I need to know about US tax? — A Singaporean who becomes a US tax resident — through a green card or the substantial presence test on an H-1B1, H-1B or L-1 — is taxed by the US on worldwide income. Singapore accounts, CPF, SRS, unit trusts and property become reportable, many Singapore funds become PFICs, and there is no treaty to soften the transition.
- Can I withdraw my CPF if I move to the US? — Singapore citizens cannot withdraw their CPF simply because they move to the US; the savings stay in Singapore until the normal withdrawal ages. Singapore permanent residents who renounce PR and leave Singapore permanently can generally withdraw their CPF in full. Either way, US reporting applies to the balances once you are a US tax resident.
- Can I keep or rent out my HDB flat or Singapore property while working in the US? — HDB flats come with minimum occupation rules and rental restrictions set by HDB, so whether you can rent out the whole flat while abroad depends on your flat and approvals. Private property can usually be rented. Once you are a US tax resident, Singapore rental income and any sale gain are taxable in the US, with Singapore tax paid available as a credit.
- I'm Singaporean and moving back from the US — what happens to my 401(k), RSUs and US accounts? — A Singaporean returning from the US usually keeps the 401(k), which stays taxable in the US on withdrawal with no treaty relief, while Singapore generally does not tax foreign-sourced income received by individuals. RSUs earned in the US remain partly US-taxable after you leave. Long-term green card holders must check the exit tax, and US assets face US estate tax.
- Do Singaporeans pay US estate tax on US stocks and funds? — Yes, potentially. A Singaporean who is not a US citizen or US domiciliary is exposed to US estate tax on US-situs assets — including US shares, US-domiciled ETFs and US real estate — above an exemption of only $60,000. There is no US–Singapore estate tax treaty to raise that amount, and rates reach 40%.