The XXX Process

This post comes a bit late as most of you probably would have filed your income tax. From what I noticed of people filing taxes, 3 areas are commonly forgotten by taxpayers. I can share my observations:

1) Rental Expenses
Rent received from the letting of property in Singapore is subject to income tax, while your property is subject to property tax. Your rental income includes rent of the premises, maintenance, furniture and fittings.

Some people are not aware that there are allowable expenses that can be deducted from the Gross Rent to save tax. Some deductible expenses include:
a) Interest paid on the loan or mortgage taken to purchase the property which is rented out.
b) Property tax
c) Fire insurance
d) Repairs done to restore the property to its original state
e) Cost of maintaining the property (e.g. painting, pest control, monthly maintenance charges to management corporations)
f) Agent’s commission, advertising, legal expenses for getting subsequent tenants

2) Parents Relief
‘Parent/handicapped parent relief’ is a relief to promote filial piety and provide recognition to individuals supporting their parents/handicapped parents in Singapore. You may claim this relief if you supported your or your spouse’s parents, grandparents and great grandparents in the previous year.
* It is common that people forgot about their Grandparent. Assuming 3 generations: Son, Father and Grandfather. Son earns $80,000, Father earns $20,000 and Grandfather not earning anything.
* The son can claims Parents Relief on his Grandfather since his father is not able to benefit from the Parent relief.
* The relief can be as much as $7,000 but it is commonly forgotten.

The amount of relief for each dependant is as follows:

3) Course Fees
‘Course fees relief’ is given to encourage an individual to continuously upgrade himself so as to enhance his life-long employability. The relief is targeted at those who are or have been gainfully employed.

Type of courses, seminars and conferences covered under this relief
* Seminar or conference (attended on or after 1 Jan 2003) that relates to your trade, business, profession, vocation or employment;
* Course, seminar or conference (completed on or after 1 Jan 2003) that does not relate to your trade, profession, vocation or employment at the time they were taken but are now relevant due to a career change;
* Course, seminar or conference leading to an approved academic and professional qualification. To-date, there is no specific listing of approved academic and professional courses. 
* With effect from Year of Assessment (YA) 2009, a course (completed on or after 1 Jan 2008), seminar or conference (attended on or after 1 Jan 2008) leading to an approved vocational qualification is eligible for this relief.

Where your assessable income exceeds $22,000 during any YA of the course duration, you would be required to claim the relief for course fee incurred in that YA as well as any preceding YAs, up to a maximum of $3,500.

(The above are very brief descriptions and my intention is simply to give some tips. For detailed info, please refer to the IRAS website)