Generally, severance payments made as compensation for the loss of employment are not taxable because they are capital receipts. However, other payments such as salary in-lieu of notice and gratuity for past services are taxable as they are not payments for loss of office.
Please see IRAS circular "Retrenchment Pay that Constitutes Payment for Loss of Employment is not taxable" for more details.
source : https://www.iras.gov.sg