Tax filing season this year has been extended amid the Covid-19 pandemic, and income tax payments have also been deferred for some groups of taxpayers. This is what you need to know about filing and paying your taxes, with tips from the Inland Revenue Authority of Singapore for the employed, self-employed, taxi or private-hire drivers, and landlords.
Q: When must tax returns be filed?
A: Income tax filing for individuals, including sole proprietors and partnerships, has been automatically extended to May 31.
However, note that the Inland Revenue Authority of Singapore (Iras) is temporarily closing its e-Filing Service Centre and Taxpayer and Business Service Centre at Revenue House.
Those with appointments will be contacted via SMS to arrange alternative modes of assistance.
Meanwhile, taxpayers can access myTax Portal to file tax forms and returns, view tax amounts and make payments, among other functions.
Q: Can tax payments be deferred?
A: Self-employed people will automatically have their income tax payment deferred for three months.
For employees, they can apply for a three-month deferment on the Iras website.
They can also request to pause Giro deduction in the months of May, June and July this year.
Deduction will resume in August, with the end date of the instalment plan extended by three months.
Q: Can I request more time to pay my taxes?
A: Those facing financial difficulties and who require more time to pay their taxes can apply for a longer Giro payment arrangement on receipt of their tax bill or e-notice of assessment.
1. EMPLOYED PERSONS
Claim course fee relief if you have paid for courses, seminars or conferences that are relevant to your work. This does not include courses for recreation or general skills such as Microsoft Office and basic website building.
Up to $5,500 of such fees can be claimed each year and will be offset against chargeable income.
Claim parent relief if you are eligible. For instance, you have dependants such as parents, grandparents, parents-in-law and grandparents-in law who are at least 55 years old and did not have income exceeding $4,000 last year.
Dependants can live in the same or separate households. If the dependant lives in a separate household in Singapore, you must have incurred $2,000 or more in supporting him or her last year.
Parent relief can be claimed for up to two dependants.
2. TAXI AND PRIVATE-HIRE VEHICLE DRIVERS
Indicate the nature of business (private-hire car or taxi driver) in your electronic tax form to receive an automatic deduction of 60 per cent of driving income, which will be deemed as business expenses.
Drivers who choose to claim deductions based on the actual amount of car expenses incurred may amend the computed information in their electronic returns.
If you choose to do so, you must retain all records for five years and provide Iras with supporting documents, such as receipts and invoices, when requested.
Those who did not earn more than $100,000 in revenue from driving last year need to provide only their revenue and adjusted profit, which is revenue after deducting business expenses, in their tax returns.
Those who earned more than $100,000 in revenue from driving will need to provide their gross profit or revenue, as well as allowable business expenses, in addition to revenue and adjusted profit.
3. SELF-EMPLOYED PROPERTY AND INSURANCE AGENTS
Opt to claim a deemed amount of expenses based on 25 per cent of gross commission income. This is provided that your annual gross commission income does not exceed $50,000.
This way, you do not have to manually calculate the actual amount of expenses incurred in earning the commission income.
Claim transport expenses if you did not choose the deemed expense ratio of 25 per cent.
Claims can be made on public transport expenses, but not on fuel, vehicle or certificate of entitlement costs for those who purchased a car and drove it to meet clients.
This is because car expenses are considered private.
Declare forfeited deposits, which are generally considered part of gross rent and are taxable.
But Iras may exclude forfeited deposits from gross rent depending on the reason of forfeiture, such as damage to property by the tenant.
You are required to send an e-mail via myTax portal to provide the reason(s) for forfeiting the rental deposit.
Refer to the date when rent is due, and not the date when rent was received, in your tax declaration. Rental income is based on the date it is due and payable.
Declare the gross rent due and receivable for the year, and not the gross rent actually received for the year.
Choose to deduct deemed expenses calculated at 15 per cent of the gross rent, in lieu of the actual amount of deductible expenses incurred from rental income. This simplifies tax filing and eases the burden of record-keeping, Iras said.
Landlords can also claim for the mortgage interest on the loan taken to purchase the tenanted property. If you do so, remember to keep supporting documents relating to mortgage interest for at least five years for verification.
Property owners can also opt to claim the amount of actual rental expenses incurred.
For tax-related inquiries, call Iras on 1800-356-8300 (individual income tax and property) or 1800-356-8622 (corporate tax), or go to Iras' live online chat channel on weekdays between 8am and 5pm.