Singapore S Pass Levy & Quota Explained 2026
Learning about work pass regulations in Singapore in 2026 would take more than a mere look at the Ministry of Manpower (MOM) web page. As the full operation of the Harmonized Levy and stricter Marine Shipyard DRC (Dependency Ratio Ceiling) limits are applied to business, companies should switch to a more data-driven strategy of managing headcount.
Regardless of whether you are an SME seeking to hire the first foreign professional or a multinational with a large workforce, this guide simplifies the much-needed 2026 changes to the S Pass levy, quotas, and Local Qualifying Salary (LQS) requirements.
The 2026 Levy Standardization
The time of multi-tiered levies on S Pass holders officially ends as of 2026. MOM has harmonized the prices of all the sectors to simplify the system and make the S Pass a high-value pass among the middle-skilled laborers.
The Standardized S Pass Levy 2026
Monthly Levy Rate: S$650 per month. This is a standard rate in either Services, Construction or Manufacturing business of your company.
- Daily Levy Rate: S$21.37. This is true of the S Pass holders who do not work full calendar month(calculations made as (S$650×12)/365).
- Annual Budgeting: It is projected to have a fixed cost of S$7,800 per year per employee.
The “Quota within a Quota”
However, you cannot fill your overall DRC with S Pass holders even when you have headroom. The S Pass Sub-DOC serves as a certain cap:
- Services Sector: Limited to 10% of the entire workforce.
- All Other Sectors: limited to 15% of the total workforce.
Local Qualifying Salary 2026 (LQS)
You have to hire locals to earn your quota after which you can hire foreigners. The Local Qualifying Salary (LQS) thresholds are the main measure of 2026.
- 1.0 Local Count: Singaporean/PR employee with a monthly income of at least S$1,600.
- 0.5 Local Count A employee of Singaporean/PR who earns S 800 to S 1599 per month.
- The 3-Month Average: MOM uses an average of your local staff contribution to calculate your quota, over the last three months.
- Depreciation of LQS Compliance: When the salary of the local employee is lower than the amount (e.g., because he is on unpaid leave), you may lose all S Pass quota parts at once that causes a Levy Bill Discrepancy or even a record of MOM law.
Strategic Headroom Management in 2026.
Headroom Management is an area that smart HR managers are targeting in 2026. The technical positions are being given to S Pass holders with the general labor being provided by the “WP Sub-Quota” since the “Levy Gap” between Work Permits and S Passes has been decreased.
The S Pass to EP Elevation Strategy.
Another popular method in 2026 strategies is transferring high performance middle-level employees, with an S Pass, to an Employment Pass (EP).
- Advantage: E’s are free of charge and they do not add to your DRC quota.
- Requirements: The candidate should have a higher EP qualifying salary and must pass the COMPASS points-based framework.
FAQ
Does that mean I can employ on S Pass holder when my company has just 2 local employees?
: Under Services sector (10% cap), at least 9 full time local employees are required in order to have 1 S Pass holder. With other sectors (15% cap), you should have at least 6.
Does the levy vary when the holder of my S Pass receives a certification?
S Pass levy has been harmonized to S$650 irrespective of the skill certification of the worker as opposed to Work Permits (R1/R2 tiers).
Conclusion
A move to a Harmonized Levy of S$650 and a reduction in the Dependency Ratio Ceiling (DRC) in 2026 is a clear indication that the Singapore government has a strategy in mind: this is the move towards a highly productive, lean, local-centric workforce.
Disclaimer:
The article is informational and educational. It is recommended that readers should examine information on reputable sources to make business decisions like what the Ministry of Manpower (MOM) indicates on its website.