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How to file your income tax and qualify for tax relief

2022 dot 7 min read
How to file income tax and get tax relief in Singapore – person typing on laptop and writing on notepad
(photo credit: Photo by National Cancer Institute on Unsplash)
As the saying goes, there are only two things that are certain in life: death and taxes.
 
Fortunately, those who live and work in Singapore can at least take comfort in knowing that the tax regime here is one of the lowest among the developed world, while being progressive. This means that people who earn more – and thus are in a stronger financial position – pay more taxes.
 
In this table, you can see that those who earn up to $20,000 a year will not need to pay any income tax at all. The tax rates also increase as a person's chargeable income goes up, which means the higher Singapore tax residents earn, the more heavily they are taxed.

Resident tax rates

From YA 2017 onwards

Chargeable IncomeIncome Tax Rate (%)Gross Tax Payable ($)
First $20,000
Next $10,000		0
2		0
200
First $30,000
Next $10,000		-
3.50		200
350
First $40,000
Next $40,000		-
7		550
2,800
First $80,000
Next $40,000		-
11.5		3,350
4,600
First $120,000
Next $40,000		-
15		7,950
6,000
First $160,000
Next $40,000		-
18		13,950
7,200
First $200,000
Next $40,000		-
19		21,150
7,600
First $240,000
Next $40,000		-
19.5		28,750
7,800
First $280,000
Next $40,000		-
20		36,550
8,000
First $320,000
In excess of $320,000		-
22		44,500

How to file income tax in Singapore?

There are also deductions and reliefs that Singapore tax residents can look forward to – provided they are well-informed about what they are eligible for and properly claim for them.
 
To help you get ready for the upcoming tax season, here's a handy refresher of the essentials to filing personal income tax in Singapore.
 
The amount of tax you need to pay, depends on two main factors: your taxable income, and any deductions and tax reliefs in Singapore you are eligible for.
 
Here's what each of these factors mean for you.

What is the difference between taxable income and non-taxable income?

Not all forms of income derived in Singapore is taxable.
 
The most common form of taxable income is one's salary, which includes your full-time salary, as well as money from part-time jobs or freelance gigs. Bonuses are taxable as well, such as your Annual Wage Supplement (also known as the 13th month bonus), performance bonuses, and commissions from sales.
 
Other forms of taxable income that need to be declared include rental income you earn from properties, payouts from private annuity plans, directors' fees, as well as monies paid out from a trust.
 
Examples of non-taxable income are lottery winnings, CPF LIFE payouts, capital gains from investments, as well as alimony or maintenance payments.

What are the deductions and reliefs you can qualify for?

Deductions are expenses you've incurred throughout the year that can be offset from your taxable income. If you have planned it carefully, you may even be able to bring yourself down to a lower tax bracket (and consequently, be charged a lower income tax rate).
 
Common deductions include:
  • costs incurred from maintaining your rental property
  • business expenses not reimbursed to you by your company
  • medical expenses
  • charitable donations
 
You can also earn deductions by contributing to your CPF via the Retirement Sum Topping Up (RSTU) Scheme or your Supplementary Retirement Scheme (SRS) account, which offer you a dollar-for-dollar tax deduction, up to a cap of $7,000 and $15,300 respectively.
 
Your final tax bill will also be reduced based on the reliefs you qualify for. Examples of reliefs include taking care of your elderly parents, having a handicapped sibling, spouse or parent, being a National Serviceman, being a working mother, having a newborn and more.

How to pay your personal income tax bill?

The simplest way to file your taxes is to log in to the Inland Revenue Authority's myTaxPortal using your SingPass, and follow the step-by-step process of declaring your income, inputting your deductions, and claiming for tax reliefs.
 
Once you've filed your personal income tax and checked for errors, you'll then receive a Notice of Assessment (NOA) from IRAS, which states what your tax bill will be. Do check it carefully and inform IRAS as soon as possible if there are any discrepancies.
 
There are many ways to pay your income tax bill, such as via:
  • GIRO
  • credit cards
  • funds transfer via internet banking
  • AXS, SAM, and selected ATM machines
  • NETS at SingPost branches

Building wealth in a smart, flexible manner

Paying taxes is a rite of passage that signify one's entrance into the working world. It is part and parcel of becoming an independent individual and contributing member of society, while working towards your personal goals. The taxes that you pay contribute to nation-building and enabling important government expenditure for yourself and your loved ones.
 
On a personal level, plans like AIA Smart Wealth Builder Series support you in achieving your own goals in life – whether that's - to support your child through a good education, enjoy a fruitful retirement or to leave a legacy to your loved ones.
 
AIA Smart Wealth Builder is designed to maximise your savings with potentially higher returns, with a variety of premium payment terms and the certainty of guaranteed capital regardless of how the market performs.
 
With a single plan, you have the flexibility to cater to various life goals you might have – even if they change along the way. To find our more about AIA Smart Wealth Builder Series, speak to a trusted AIA representative or read more from the product brochure.

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