According to the World Bank, about 12% of Singapore’s workforce in 2024 were self-employed. While managing your own schedule and responsibilities can be challenging, self-employment offers several benefits, including flexible working hours, control over your workload, and the ability to balance personal commitments, such as caring for young children. Pacific Prime provides insights into common questions about self-employment in Singapore, covering legal requirements and health insurance considerations.

Defining Self-Employment In Singapore, freelance and independent work is classified as self-employment by the Inland Revenue Authority of Singapore (IRAS). Common examples include operating an online business, working as a taxi driver, or serving as a real estate or insurance agent. IRAS provides guidance on key obligations for self-employed individuals, including filing income taxes.

Can Expats Work as Self-Employed? Legal self-employment in Singapore is restricted to citizens and permanent residents. They are also required to pay income tax and contribute to their Medisave account, Singapore’s mandatory medical savings scheme.

Expats wishing to operate independently have two main options. First, they can establish a local company, which requires having at least one Singaporean resident director. Alternatively, they can apply for an EntrePass, which allows foreign entrepreneurs to incorporate and run a business in Singapore. This route may also involve securing funding or partnering with approved organisations.

Working Under a Dependant or Long-Term Visit Pass If you are living in Singapore on a Dependant’s Pass (DP) or Long Term Visit Pass (LTVP), working without proper authorisation is not allowed. A Letter of Consent, Work Permit, Employment Pass, or S Pass is required. The Letter of Consent specifically allows DP or LTVP holders to work if their spouse or partner holds an Employment Pass. This consent becomes invalid once the sponsoring Employment Pass expires.

Business Licensing Requirements Not all self-employed work requires a business license, but certain industries do. For example, running a real estate agency requires a license from the Council of Estate Agents, providing ride-sharing services requires approval from the Land Transport Authority, and operating a food stall or working as an insurance agent also requires a licence.

Health Insurance for the Self-Employed Singapore citizens and permanent residents contribute to the national Medishield insurance, which covers hospitalisation and certain medical treatments. Expats, however, must arrange their own health coverage. Unlike employees who often receive group health insurance through their employer, freelancers or self-employed individuals need personal health insurance plans.

Individual vs Employer Health Insurance Employer-provided plans typically cover pre-existing conditions, while most individual plans do not. On the other hand, employer plans may have limited benefits, excluding dental, maternity, or vision coverage. Personal plans allow self-employed individuals to choose coverage that fits their needs.

Other Insurance Considerations Self-employed individuals do not have access to worker’s compensation insurance, which protects employees against income loss due to injury or illness. Instead, freelancers can consider business interruption insurance or income protection policies. These plans can provide essential financial support if illness or accidents prevent you from working.

Final Thoughts Self-employment in Singapore offers flexibility and autonomy, but it also comes with added responsibilities. Understanding legal requirements, planning for taxes, and securing appropriate health and income protection coverage are essential for sustaining a successful self-employed career. By preparing carefully, both locals and expats can enjoy the benefits of independent work while mitigating potential risks.