How to Hire Remote Developers in Singapore Without CPF or Levies

If you want to hire remote developers in Singapore without CPF or levies, the short answer is to stop trying to employ an overseas developer and instead buy development services from a foreign company through a business-to-business (B2B) contract. That one structural change legally removes the 17% employer CPF contribution, the Skills Development Levy, the foreign worker levy, and Employment Pass paperwork. This guide explains exactly how the model works, what it costs in SGD, whether it is legal, and how to use it without sacrificing code quality or IP ownership.

Hiring software engineers in Singapore is expensive, and not only because of salaries. The mandatory statutory costs attached to every person on your payroll quietly inflate your real cost by roughly 17-37% above base salary before you have written a single line of code. Understanding where those costs come from is the first step to legally avoiding them.

Why do CPF and levies make local hiring so expensive?

Say you hire a mid-level developer in Singapore at S$7,000 per month. Your true monthly cost is not S$7,000 — once statutory and overhead items are added, it looks more like the table below.

For a Singapore citizen or PR, the employer CPF contribution is the largest add-on. For a foreign hire on an Employment Pass, you also carry EP application and renewal fees plus Fair Consideration Framework job-advertising obligations. An S Pass holder adds a monthly foreign worker levy on top of everything else. None of these line items buy you a single extra hour of engineering — they are pure overhead. For the full breakdown of who pays what, see our explainer on whether you pay CPF for foreign workers in Singapore.

How to hire remote developers in Singapore without CPF or levies: the B2B model

When you engage developers through an overseas partner such as Outsourced SG, the legal structure is fundamentally different from employment:

• The developer is employed by the outsourcing partner in their home country (Indonesia), not by your company.
• Your Singapore company holds a B2B services contract with that partner.
• You pay a single monthly invoice — no CPF, no levies, no work permits, no MOM filings.
• The partner handles local employment law, payroll, income tax, statutory benefits, and equipment.

This is completely legal under Singapore law. You are not employing a person in Singapore; you are purchasing development services from a foreign entity. Because the developer never works inside Singapore and is never on your payroll, the CPF Act and the Employment Act do not apply to that relationship. It is the same principle that lets you pay an overseas SaaS vendor or design agency without routing them through the Ministry of Manpower. This arrangement is a common form of staff augmentation, and you can see the end-to-end process on our how it works section.

How much can you actually save without CPF or levies?

Here is the comparison most founders run before deciding. Outsourced SG pricing is S$400 per developer per month on the Starter Squad plan (1-2 developers) and S$550 per developer per month on the Product Team plan (3-5 developers). All figures are in SGD. Below we compare a three-person team hired locally against the same headcount through Outsourced SG at the Product Team rate.

The local figure uses the S$8,901 fully loaded monthly cost from earlier, multiplied by three. The savings come from two distinct sources: a lower base wage in Indonesia, and the complete removal of CPF, the Skills Development Levy, the foreign worker levy, office, and equipment overheads. For a line-by-line model of local costs, read our cost to hire a software developer in Singapore breakdown.

One honest nuance: the headline "save up to ~17-37%" figure refers specifically to the statutory and overhead premium you avoid versus a comparable local hire. The total saving in the table above is larger because you are also moving to a lower-cost talent market entirely. Be clear with your own board about which of the two numbers you are quoting, so the comparison stays fair and defensible.

Is hiring developers this way actually legal in Singapore?

Yes, and it is worth being precise about why, because this is the question that makes finance and legal teams nervous. Three things make the model clean:

1. No employment relationship in Singapore. You contract with a company, not a person. CPF and the foreign worker levy are obligations of an employer, and you are not the employer here.
2. No work performed in Singapore. The developer lives and works in Indonesia, so there is no work pass to apply for because no one is working on Singapore soil.
3. A proper services agreement. The contract is a B2B service-supply arrangement with clearly defined deliverables, confidentiality, and IP terms.

This is not a loophole; it is the standard way Singapore companies engage offshore agencies, freelancers, and dedicated teams, and it is exactly how many funded startups keep their burn rate low while still shipping quickly. Your accountant treats the monthly invoice as a normal operating expense, the same as any other software or services vendor, so there is no payroll, no IR8A reporting, and no MOM correspondence to manage. If you want the full picture before committing, our guide on how to outsource software development in Singapore walks through contracts, scope, and onboarding.

Who owns the code, and is your IP protected?

This is the second question every careful founder asks, and rightly so. Removing CPF is pointless if you do not clearly own what gets built. With Outsourced SG, every engagement includes a signed NDA and an IP assignment clause, so your company owns 100% of the intellectual property — source code, designs, and documentation — exactly as if the work had been done in-house. The developer is contractually bound to confidentiality, and all output is assigned to your company on creation, not at the end of the project. For the cross-border legal mechanics, see do you own the IP when outsourcing software.

What about developer quality and vetting?

Cost savings mean nothing if code quality drops, which is why the vetting process matters more than the price. Every Outsourced SG developer has a minimum of 3 years of experience (5+ years on average) and passes a four-stage screen:

1. Resume and track-record screening
2. A timed technical coding challenge
3. A live system-design interview
4. An English communication assessment

Only a small fraction of applicants make it through. Just as important, our engineers are AI-trained on Cursor and Claude Code and modern agentic workflows, so they ship faster than a typical developer working without those tools. You still interview and choose every person yourself — we shortlist, you decide, and you never inherit a developer you have not approved. That is the part founders most often worry about with offshore hiring, and it is the part we deliberately keep in your hands.

Why does the Indonesia time zone matter?

Indonesia (Western Indonesia Time, GMT+7) is just 1 hour behind Singapore, which means near-full overlap of the working day — real-time standups, pair programming, and same-day code review. That overlap is hard to replicate from other popular destinations:

• Indonesia — 1 hour behind (near-perfect overlap)
• India — 2.5 hours behind (workable, but less real-time)
• Vietnam — 1 hour behind (similar to Indonesia)
• Eastern Europe — 5-6 hours behind (morning overlap only)
• Latin America — 11-13 hours behind (almost no overlap)

Time-zone overlap is the single biggest predictor of whether a remote team feels remote. For more, see Indonesia vs India vs Vietnam outsourcing.

What you get with Outsourced SG

• Full-time, dedicated developers (40 hours per week) who join your Slack, standups, and sprints
• Minimum 3 years of experience, AI-trained on Cursor and Claude Code
• NDA and IP assignment, so you own 100% of the code
• Outsourced SG handles contracts, payroll, and equipment — you just manage the work
• Developers live in under 2 weeks (urgent placements in 3-5 days)
• A 30-day replacement guarantee and no lock-in

Ready to compare your current burn against this model? Check current rates on our pricing section, then message Joshua and the team on WhatsApp at +65 9456 2307 for a free, no-obligation shortlist of developers matched to your stack.

Frequently asked questions

Can I legally hire remote developers in Singapore without paying CPF?

Yes. CPF is an obligation of an employer toward an employee working in Singapore. When you engage developers through a B2B services contract with an overseas partner like Outsourced SG, the developer is employed by that partner in Indonesia, not by you. There is no employment relationship in Singapore, so CPF, the Skills Development Levy, and the foreign worker levy do not apply.

Do I need to register with MOM or apply for a work pass?

No. Work passes and MOM filings are only required when a foreign person works in Singapore for a Singapore employer. Your developers live and work in Indonesia and are employed by the outsourcing partner, so there is nothing to register and no Employment Pass or S Pass to apply for. Your finance team simply books the monthly invoice as an operating expense.

How much can I save by avoiding CPF and levies?

Against a comparable local hire, removing the 17% employer CPF, the Skills Development Levy, the foreign worker levy, office space, and equipment typically saves about 17-37% of fully loaded cost. Because the offshore model also moves you to a lower-cost talent market, total savings are usually much larger. Outsourced SG rates are S$400 per developer per month (Starter Squad, 1-2 devs) and S$550 per developer per month (Product Team, 3-5 devs), all in SGD.

Who owns the intellectual property in the code?

You do. Every Outsourced SG engagement includes a signed NDA and an IP assignment clause, so your company owns 100% of the source code, designs, and documentation, the same outcome as an in-house hire. All output is assigned to your company as it is created, not at the end of the project.

Can I still manage the developers like my own team?

Yes. They work full-time (40 hours per week), join your Slack, attend your standups, follow your processes, and work in near-full overlap with Singapore hours since Indonesia is just 1 hour behind. You interview and choose each developer yourself. The only practical difference is who issues their paycheck and handles their payroll.

How fast can I get a developer started, and what if it does not work out?

Most placements go live in under two weeks, and urgent roles can be filled in 3-5 days once you have chosen a candidate. Engagements have no lock-in, and a 30-day replacement guarantee means that if a developer is not the right fit, we replace them at no extra cost.

Related guides

• Do I Pay CPF for Foreign Workers in Singapore?
• Cost to Hire a Software Developer in Singapore 2026
• Offshore vs Onshore Developers Cost Comparison Singapore