SINGAPORE – Fresh graduates who have just entered the workforce might find filing their income tax returns a daunting task that school lessons did not prepare them for.

The individual income tax season runs from March 1 to April 18 every year. The deadline for those filing a paper tax return is April 15, while those filing electronically have till April 18.

With the deadline fast approaching, The Straits Times spoke to the Inland Revenue Authority of Singapore (Iras) to find out what information individuals need to file on their income tax returns, which reliefs and deductions they might be eligible for, and some common mistakes to avoid.

Q: What is income tax, and how do I know if I need to file an income tax return?

A: For the Year of Assessment 2024 (YA2024), you will be taxed based on your income earned in the previous year between Jan 1, 2023, and Dec 31, 2023.

Generally, income earned in or derived from Singapore is subject to income tax, if it exceeds $22,000, or if your self-employment income had a net profit exceeding $6,000.

Income can come from sources such as employment, trade, business, profession and vocation, and from renting out your property.

For employees, your employment income, including your salary, bonus or commission, is taxable. Additional allowances such as those for transport or meals, or other benefits such as club memberships, are also taxable.

For the self-employed, your income earned from the buying and selling of goods, or from providing professional or personal services, is taxable.

Taxpayers fall under two categories – those on the no-filing service (NFS), and those required to file an income tax return.

If you received a letter, form or SMS informing you to file an income tax return, you must do so by April 18.

If you were informed that you are under the NFS, you do not need to file an income tax return. However, you will need to log in to myTax Portal to check that your automatically included income information and relief claims are correct.

Q: What kind of information do I need on hand to file my income tax return?

A: Ensure that you have these documents ready before logging into myTax Portal:

• Singpass account/Singpass foreign user account
• Form IR8A from your employer (if your employer is not participating in the Auto-Inclusion Scheme)
• particulars of your dependants, such as parents or children, for new relief claims
• details of rental income from your property and other income, if any

Under the Auto-Inclusion Scheme, employees’ income information will be automatically filled up in their tax returns by their employers.

Q: What are tax reliefs and how do I know which ones I am eligible for?

A: Tax reliefs can help reduce the amount of income tax you pay.

According to the Ministry of Finance’s website, the various types of personal income tax reliefs are in line with Singapore’s social objectives, such as taking care of elderly parents and saving for retirement. One instance is the Parenthood Tax Rebate, which is given to encourage the birth of Singaporean children after marriage.

In Singapore, tax reliefs include those for earned income, CPF, parents and course fees. If you are married, you may also be eligible for the spouse relief, qualifying child relief, parenthood tax rebate, and grandparent caregiver relief.

If you are eligible for some of these, you will pay less income tax as these reliefs are deducted from your chargeable assessable income.

Each taxpayer can only claim up to $80,000 in personal income tax reliefs for each year of assessment.

However, you will need to fulfil certain criteria in order to qualify for a relief.

For instance, to be eligible for parent relief in YA2024, you must have satisfied the following conditions in 2023:

• You have supported your dependant (parents, parents-in-law and more).
• Your dependant was 55 years old and above.
• Your dependant did not have an annual income of more than $4,000 in 2023.
• Your dependant was living with you in the same household in Singapore or living in a separate household in Singapore, and you have incurred $2,000 or more in supporting him or her.

Some tax reliefs are not pre-filled in tax return forms. However, if you were granted reliefs in previous years, they will be pre-filled automatically if you remain eligible for them.

If you are filing tax for the first time, remember to check if you meet the conditions for each relief by visiting go.gov.sg/taxreliefs

Q: What are deductions and how can they help me lower my tax bill?

A: In Singapore, the variety of deductions you can employ to lower your tax bill include business and employment expenses, rental expenses and qualifying donations.

For example, if you have property that you are renting out, you can claim tax deductions on rental expenses that you incur solely for producing the rental income and during the tenancy period.

Expenses can include property tax incurred during the rental period, premiums paid on fire insurance, repairs done during the rental period, and cost of maintaining the property.

Donations that are tax-deductible include cash donations for local and overseas causes, donations of public shares, artefacts to museums, donations under the public art tax incentive scheme, and donations of land or buildings.

However, not all cash donations made to charities are tax-deductible. For local causes, only cash donations made to an approved Institution of a Public Character (IPC) or the Singapore Government are tax-deductible. Not all registered charities are approved IPCs.

You can find out which organisations are approved IPCs on the Charity Portal.

Q: How much will I be taxed?

A: Singapore’s personal income tax rates for resident taxpayers are progressive, which means higher income earners pay a proportionately higher tax rate. The current lowest personal income tax rate is at 2 per cent, while the highest is at 24 per cent.

During Budget 2024, Deputy Prime Minister and Finance Minister Lawrence Wong announced that residents in Singapore will receive a 50 per cent personal income tax rebate for income earned in 2023. The rebate is meant to help alleviate the rising cost of living, and will be capped at $200.

The full list of tax rates can be found on Iras’ website.

Q: How can I avoid mistakes when making relief claims?

A: According to Iras, tax reliefs that are commonly incorrectly claimed include the qualifying child relief, parent relief and spouse relief.

Among the tax reliefs that have been incorrectly claimed, a majority of them were because taxpayers did not meet the qualifying conditions for each relief.

For example, the annual income of a dependant must not exceed $4,000 in the previous year.

Other errors may also stem from duplicate claims made by two or more taxpayers for the same dependant. Tax reliefs such as parent relief and child relief may be shared among individuals based on a mutually agreed upon division, if they are maintaining the same dependant and meet the qualifying conditions.

However, the total relief claimed by all parties should not exceed the allowable amount.

For parent relief, a taxpayer living with one dependant would be able to have $9,000 deducted from their tax bill. However, if there are two taxpayers maintaining the same dependant with all of them living in the same household, the taxpayers are not allowed to claim $18,000 in total, but must divide the $9,000 between themselves.

Q: Can I make changes after I have filed or after receiving my tax bill?

A: If you need to make changes after filing the original income tax return, you can refile on myTax Portal within seven days of your previous submission or by April 18, whichever is earlier.

For YA2024, Iras has begun issuing taxpayers their tax bills, also known as the Notice of Assessment.

Most taxpayers will receive their bills from the end of April 2024.

You are encouraged to check and ensure that your income details and relief claims are accurate in the bill – if other incomes or claims are not shown in the bill, inform Iras of the discrepancy using the Object to Assessment digital service on myTax Portal within 30 days.

Taxpayers who realise they have made an error in their tax returns are encouraged to notify Iras voluntarily, “in a timely manner”, to correct their errors.

Under the Iras Voluntary Disclosure Programme, the tax agency is prepared to reduce penalties for voluntary disclosures that meet the qualifying conditions.