Not Ordinarily Resident (NOR) Scheme: The Closed Tax Scheme Some Foreigners Still Rely On
Why this favourable tax treatment for overseas-working employees stopped accepting new applicants after YA2020.
The Not Ordinarily Resident (NOR) Scheme was a Singapore tax scheme that gave qualifying individuals partial tax exemptions on income earned from time spent working outside Singapore. It was discontinued for new applicants after Year of Assessment (YA) 2020, and only taxpayers who already held NOR status before closure can still use it for the remainder of their five-year qualifying period.
Not financial advice. All figures for educational reference only. Data as at September 2026.
Last updated: September 2026
Key Takeaways
- The NOR Scheme is closed to new applicants; the last year in which NOR status could be newly granted was YA2020, and no fresh applications have been accepted since.
- Individuals who already held NOR status before closure can continue enjoying its benefits for the remainder of their five-year qualifying window, meaning a shrinking population of taxpayers still uses the scheme in 2026.
- The scheme’s main benefit was time apportionment of employment income — taxing only the portion of income linked to time actually spent working in Singapore, for those with significant overseas travel obligations.
- A second benefit exempted employer contributions to a non-mandatory overseas pension or provident fund from tax, subject to conditions.
- New senior hires and expatriates moving to Singapore today are taxed under ordinary tax residency rules, since the NOR route is no longer available to them.
What Was the NOR Scheme?
Introduced in 2002, the Not Ordinarily Resident Scheme was designed to make Singapore more attractive as a regional base for senior executives and specialists who needed to travel extensively for work, particularly to manage regional operations across Asia. Without the scheme, a Singapore tax resident is generally taxed on all employment income sourced from their Singapore employment, even for days spent working overseas. The NOR Scheme relaxed this for qualifying individuals by allowing time apportionment: only the income attributable to days physically spent working in Singapore was taxed at full resident rates, with the remainder benefiting from reduced effective tax.
To qualify originally, an individual needed to become a Singapore tax resident while not having been a Singapore tax resident for the three years immediately prior, and needed to meet minimum criteria on time spent working outside Singapore for business reasons. Once granted, NOR status applied for five consecutive years of assessment.
Why the Scheme Closed
The NOR Scheme was allowed to lapse as part of Singapore’s periodic review of tax incentives; the government announced that no new NOR status would be granted for any year of assessment after 2020. This mirrors how several other targeted Singapore tax incentives, including the Angel Investors Tax Deduction Scheme, have had built-in or announced sunset points rather than running indefinitely.
Individuals who were granted NOR status for YA2020 or earlier retain the benefit for their full five-year window, which means the last cohort of NOR taxpayers will see their final qualifying year conclude in the mid-2020s. Anyone becoming a Singapore tax resident today, however qualified they might otherwise have been, cannot apply for NOR status, since the scheme is fully closed to new entrants.
NOR Scheme Example (Historical)
A regional sales director relocated to Singapore in 2018 and was granted NOR status effective YA2019, valid through YA2023. In YA2021, she spent 90 of 250 working days physically in Singapore, with the rest split across other Asian offices for business reasons. Under NOR time apportionment, only the income linked to those 90 Singapore working days was taxed in full; income attributable to the remaining overseas working days received the scheme’s reduced tax treatment, subject to a floor ensuring a minimum effective tax rate still applied. By YA2024, her five-year NOR window had ended, and she reverted to being taxed under ordinary resident rules on her full employment income.
Why the NOR Scheme Mattered While Available
- Reduced tax drag on regional roles. It made Singapore employment more tax-efficient for executives whose jobs genuinely required substantial time working abroad.
- Encouraged regional headquarters activity. By easing the tax burden on frequently travelling senior staff, it supported Singapore’s positioning as a base for regional management functions.
- Provided planning certainty. A five-year qualifying window gave employers and employees a defined, plannable period of favourable treatment.
- Complemented other expatriate-focused reliefs. It worked alongside other Singapore tax reliefs available to foreign employees at the time.
Risks and Limitations (For Remaining NOR Holders)
- Scheme is winding down. Since no new grants are possible, the benefit only exists for a shrinking, aging group of taxpayers whose windows are expiring.
- Minimum tax floor still applies. Time apportionment does not reduce tax below a specified minimum effective rate on Singapore employment income.
- Conditions must continue to be met. Losing eligibility partway through the five-year window (for example, by failing minimum overseas travel requirements in a given year) can affect that year’s benefit.
- Post-window planning gap. Individuals nearing the end of their NOR window should plan for a step-up in effective tax once ordinary resident rules resume applying in full.
NOR Scheme vs Ordinary Tax Residency (Singapore)
| Feature | NOR Scheme (Legacy) | Ordinary Tax Resident |
|---|---|---|
| New applications accepted | No, closed after YA2020 | Not applicable, standard rules apply to all |
| Overseas working days | Time-apportioned, reduced tax treatment | Generally still taxed if linked to Singapore employment |
| Employer overseas pension contributions | Can be exempt from tax, subject to conditions | Generally taxable as part of remuneration |
| Qualifying period | Five consecutive years of assessment | Indefinite, based on annual residency tests |
| Who it applies to today | Only individuals already granted status before closure | All Singapore tax residents |
Source: Inland Revenue Authority of Singapore (IRAS), public guidance on the NOR Scheme.
The Bottom Line
The NOR Scheme is now a legacy arrangement rather than an active planning option: it cannot be newly applied for, and only a diminishing group of taxpayers granted status before YA2020 still benefit from it. Anyone researching Singapore tax residency options today should focus on the ordinary resident and non-resident rules that now apply to all new arrivals.