Employers are required to file a Tax Clearance (Form IR21) for foreign employees (non-citizens or non-permanent residents) who cease employment, leave Singapore for an extended period, or start an overseas posting. This ensures that all taxes are settled before they leave Singapore.
Upon filing Form IR21, employers must withhold all monies due to the employee from the date they are aware of the employee's upcoming departure until tax clearance is completed.
Form IR21 is used to notify the Inland Revenue Authority of Singapore (IRAS) when a non-citizen employee is about to leave Singapore for more than three months or cease employment in Singapore. It ensures that all taxes owed by the departing employee are settled before they leave the country.
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