Compare the income and reliefs on your notice with your own records and find anything missing.
Wei Jie's mother moved in with him last year, after his father died. He pays most of her living costs and takes her to her medical appointments. When a colleague mentioned parent relief over lunch, Wei Jie said he had assumed IRAS knew his situation and would have added anything he was entitled to.
IRAS gets a lot of information from employers, the CPF Board and other agencies, but it doesn't know everything about your life. Some reliefs only appear on your notice of assessment if you claim them. When Wei Jie opened his notice, there was no parent relief on it. You can check two parts of the notice yourself: the income and the reliefs. Start with the income, then move on to the reliefs.
Each year your employer gives you a statement of your employment income, usually the IR8A form. If your employer is in the auto-inclusion scheme, it sends the same information straight to IRAS, and that figure appears on your notice. The employment income on your notice should match your IR8A total.
Get your IR8A for the year and compare its total with the employment income on the notice. If you had more than one employer in the year, add up all the IR8As first and compare that total with the notice. If an employer was not in the auto-inclusion scheme, check that you declared that income yourself when you filed.
Figures most often go missing or get counted twice in bonuses, one-off payments and the months around a job change, so look closely at those. If the IR8A itself looks wrong, compare it with your payslips, the way you learned to check them in Module 1. If the income on the notice is wrong because your employer reported it wrongly, ask the employer to send IRAS an amended figure. Lesson 4.3 covers what to do about the assessment itself.
Wei Jie checked the income on his notice against his IR8A. It matched to the dollar, so the reliefs were where he needed to look.
IRAS adds some reliefs automatically because it gets the information directly. CPF relief on your compulsory employee contributions is one of them: if your employer is in the auto-inclusion scheme, you do not need to claim it, and IRAS grants the relief automatically based on the information your employer sends. Earned income relief is automatic for anyone with earned income. Reliefs linked to information from other agencies, such as relief for national servicemen, are generally pre-filled.
Check these automatic reliefs anyway. Compare the CPF relief on the notice with the employee CPF shown on your payslips and your IR8A for the year. If the two are far apart, find out why before you go further.
Other reliefs depend on facts IRAS cannot see, such as who lives with you, who you support and whether the conditions apply to you. Parent relief is the usual example. It is for supporting a parent or grandparent who meets IRAS's conditions on age, residence and income. Whether a relief is pre-filled can depend on whether you claimed it before, so a first claim is the one most likely to be missed. Wei Jie had never claimed parent relief, so it was not pre-filled.
IRAS publishes the full list of reliefs on its website, with the conditions for each one and whether you must claim it. Reliefs are added, changed and removed from time to time, so read the list for the Year of Assessment shown on your notice. An older article may describe reliefs that have since changed. Go through each relief's conditions (for parent relief: age, residence and income) and note whether you have to claim it. Pay extra attention to any relief you have never claimed before.
Wei Jie went through the list. His mother meets the age and residence conditions, and he checked the income condition on the IRAS website. If two siblings support the same parent, the relief may need to be shared, and IRAS explains how to do this. Wei Jie's brother lives overseas and doesn't claim, so the relief does not need to be shared and his case is simple.
A relief reduces your chargeable income. It does not reduce your tax directly, so it saves tax at your highest rate, which is the rate charged on the top slice of your income. The same relief saves more for someone with a higher income, because their top rate is higher. If your chargeable income is already in the zero band, the band taxed at 0%, a relief saves you nothing. Check this before you spend hours on a claim.
To estimate what a missed relief is worth, find the rate on the top slice of your chargeable income. Then either subtract the relief from your chargeable income and work out the tax again, or multiply the relief by your top rate.
Wei Jie used the invented practice table from lesson 4.1, "How the notice of assessment gets from income to tax payable". Under that table, his top slice is taxed at 6%. The parent relief he missed is S$5,000 (an example figure). Claiming it would cut his chargeable income from S$48,200 to S$43,200 (S$48,200 minus S$5,000) and his tax from S$1,092 to S$792. He would save S$300, which is 6% of S$5,000. With the real rate table and the real relief amount his figures would be different, but the method would be the same.
He still has to decide what to do about the year that has already been assessed. Lesson 4.3 covers a relief missed in a year already assessed.
You need records to support every relief you claim. IRAS can ask for evidence that you qualified, and it can review claims after the notice is issued. Keep the receipts, letters and documents that show you met the conditions. For example, keep proof of address for a parent living with you. IRAS sets how long you must keep records, and the period is on the IRAS website. Keep each year's documents together in the folder you set up in lesson 8.5, "Build your document file and checklist", so you can produce them quickly if IRAS asks.
Wei Jie saved a copy of his mother's address details and made a note to claim parent relief when he next files.
Before the activity, open your latest notice and the IRAS relief list for the same Year of Assessment in two windows, and have your IR8A nearby.
Write down the reliefs on your notice, then go through the IRAS relief list and mark any you may qualify for but did not claim.
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