Unfortunately, while right angles and cursive writing were taught in school, figuring out your income tax, probably wasn’t.
Singapore Income Tax Tips
In case you didn’t know, Income tax payments can be made using credit cards and debit cards. Some banks and credit companies in Singapore are providing options to pay tax through credit cards. You can pay your income tax using Manhattan credit card, for example. You should approach your Credit Card Company or bank to enquire whether they offer this option.
Income Tax Saving Ideas
Instead of avoiding paying tax and end up being prosecuted, you can pay lesser tax with these reliefs. The following tips can enable you save tax if you are an employee in Singapore:
- Relief And Rebates
- Life insurance relief
- Handicapped brother/sister relief
- Course fees relief
- CPF provident fund relief for employees, self-employed as well as employees who are also self-employed
- Parent/ handicapped parent relief for maintenance of relatives such as parents and/or grandparents. Tax residents also qualify for tax reliefs which can be exempted against the taxable income. You can be exempted for wife support and child maintenance.
- The Not Ordinary Resident Scheme (NOR) enable you to enjoy time Apportionment of Singapore employment income.
- You can claim your employment income expenses and enjoy tax reliefs for approved charitable deductions.
- Under the Area Representative Scheme, you can enjoy time apportionment of employment income if you work for a foreign employer and you want to travel abroad in the course of work.
- You can avoid double taxation- in Singapore and your home country as a result of the Avoidance of double taxation treaties signed by Singapore government.
The amount of tax you pay may be reduced if you are a self-employed, sole proprietor or a partner in partnership in the following areas;
- Productivity and innovation Credit(PIC)
- Research and development expenditure
- Allowable and disallowable business expenses like private car and proprietors’’ salaries
- Medical expenses
- Businesses making losses
- Land intensification allowance
- Singapore provides tax exemptions to SMEs up to SGD 300000 of income
Documents To Be Kept For Income Tax Savings
Statements mailed in January and February
Unless tax day falls on a weekend, you have until April 15 to file. Otherwise, most of the documents arrive in your mailbox in January. You may get snail mail, but remember that on top of that, some things may already be available online. Remember to create an email tax folder for messages relating to tax information.
Paperless world may have turned shoeboxes into receipt relics of the past. The softcopy of the documents should be stored in online accounts such as cloud saving.
Keep a log in your car to jot down the miles you cover on volunteering, work, businesses or medical appointments which can help you qualify for a deduction.
Life events documents
Events such as birth of a child not only bring joy to the family but also tax advantages such as working mother-child relief. Marriage is also an important life event that invites wife relief. Proper filing of these documents will significantly enable you to deal with income tax operations.
All these files should be stored for at least five years depending on the expiry of the intended purpose of the documents.
You should be aware of these available income tax tips so that you can save your tax. Taxes well saved may significantly increase your disposable earnings. Proper recording and storing of various tax documents is also mandatory in ensuring that they help you have control on your tax payments.
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