In line With Smart Nation Singapore, the Wage Credit Scheme Will Be Paid via Digital Payment Modes
As a business owner, you would always find it hard to retain the right talent. It takes a lot of work to maintain the right talent. This is on top of the workload of making sure business is flourishing. One way for business owners can retain the right talent is by providing a conducive working environment and a yearly wage increase. The government of Singapore has seen better productivity from private sectors ever since the wage credit scheme takes effect.
Wage Credit Scheme
The wage credit scheme (WCS) kicked off in 2013 as a three-year scheme, supporting wage increases from the year 2013 to 2015. The support and outcome of this scheme were overwhelming that the Singapore government decided to continue the programme from 2016 and 2017. The WCS works by co-funding the wage increases made by businesses for their qualified employees. The government of Singapore funds the wage increase to a specific percentage for companies that increase the wages of their employees. This initiative is to be continued for the year 2018, 2019 and 2020 with 20%, 15% and 10% co-funding respectively. The scheme is to keep supporting businesses efforts in their organisational transformation and encourage employers to share productivity gains with employees. It also proves that even with a little wage increase, workers are likely to increase their productivity as they are more content.
Employers that are qualified for this scheme are commonly from the private sectors. Employers qualify for the wage credit scheme payouts if they provide wage increment of at least S$50 to covered employees who have been on the payroll for at least three months. The WCS covers all Singapore citizen employees who earn a gross monthly wage of S$4,000 and receive CPF contributions. The WCS will be paid to eligible employers for all the months in the year where CPF contributions were made for the covered employee. As such, wage increment is computed on an annual basis.
The future payout is the seventh time, and by the end of March 2020, eligible employers will receive notification for the amount they will be receiving. The payout will be made digitally through PayNow Corporate or GIRO. Employer will need to be registered for GIRO or PayNow Corporate successfully to get their WCS payout. This is in line with the Smart Nation efforts of which, Inland Revenue Authority of Singapore (IRAS) to fully adopt digital payment modes for WCS payouts. Digital payment modes also ensure smoother and faster payouts to employers beginning March 2020. Employers who have yet to register with GIRO with IRAS can log in to myTax Portal and select Account. Should there be a payment plan, then there is an existing GIRO arrangement. As for PayNow Corporate account, business owners can contact their respective banks and query about it. Previously, IRAS issued cheques for every wage credit scheme payouts. Ever since the introduction of PayNow Corporate and GIRO as a digital payment mode for businesses, it will be a less complicated method for companies to receive WCS payouts for both employers and IRAS.