You will be able to explain the reliefs for supporting parents and family members.
Shu Ting and her brother Darren have the same arrangement many Singapore siblings have. Their mother, who is 66, lives with Darren in his flat in Tampines. Shu Ting sends her a monthly allowance and pays for her specialist appointments. On weekdays, their mother looks after Shu Ting's baby, Wen, so that Shu Ting can go back to work. Every year both siblings wondered vaguely whether one of them should be claiming something for her, and every year the filing deadline passed before they talked about it.
This lesson covers the reliefs for supporting parents and other family members, and how to decide which of you claims.
Parent Relief is for supporting a parent, grandparent, parent-in-law or grandparent-in-law who meets IRAS's conditions. There are three tests, and the IRAS page sets the current details.
The first is the parent's age, unless the parent has a disability. The second is the parent's own income, which must be below a limit IRAS sets for the year. The third is support. Either the parent lives with you in the same household, or you spend at least a set amount supporting them during the year.
The amount depends on that third test. It is higher when the parent lives with the person claiming and lower when they live elsewhere, and higher again if the parent has a disability. That detail matters for siblings, because the brother the parent lives with and the sister who sends money each month may qualify for different amounts.
Several children can support the same parent, and they can share Parent Relief for that parent. What they cannot do is each claim the full amount. The total claimed for one parent is capped, and IRAS sets out how a shared claim is divided. If two of you claim the same parent without agreeing, IRAS will have to sort it out, which usually means letters and a revised assessment.
So the conversation has to happen before anyone files. Money as a couple and a family, lesson 5.3, Share the load with your siblings, covers how to split the care and the costs. This lesson adds the tax question to that conversation.
Shu Ting and Darren ran their numbers, using the practice table from lesson 1.4, Rebuild your tax bill from scratch, and invented relief amounts. Suppose Parent Relief were S$9,000 for a parent living with the claimant and S$5,500 for a parent living elsewhere.
Darren qualifies for the higher amount, because their mother lives with him. His chargeable income is S$33,000, and his marginal rate is 3%. Taking S$9,000 off would bring him to S$24,000, still inside the 3% band, so he would save S$270.
Shu Ting qualifies for the lower amount through her support, if she meets the spending condition. Her chargeable income is S$92,000, at a marginal rate of 10%. S$5,500 off would save her S$550.
The smaller relief saves twice as much in Shu Ting's hands, because her top rate is so much higher. They agreed she would claim, as long as she could show the spending, and that they would revisit it if Darren's income rose. Your own result could easily go the other way. That is why you run the figures and don't guess.
Grandparent Caregiver Relief is for a working mother whose young child is looked after by a grandparent, or a great-grandparent, who isn't working. The mother must be married, divorced or widowed, and the child must be within the age limit IRAS sets.
Only one person can claim the relief for a given caregiver, and it goes to the mother, not to the grandparent or the father. Shu Ting's mother looks after Wen on weekdays and doesn't work, so Shu Ting checked the conditions on the IRAS page and added it to her list.
This relief and Parent Relief can both apply to the same grandparent, since they reward different things. Check the conditions for each separately.
Separate reliefs exist for supporting a spouse, brother or sister with a disability, and Parent Relief has a higher amount for a parent with a disability. The amounts are larger than the ordinary versions, because the support usually costs more.
The conditions follow the same pattern: the family member's income, your support, and in some cases where they live. Brothers and sisters can share the sibling relief, much as they share Parent Relief, so the same conversation applies. If someone in your family has a disability, read these pages carefully, because they are among the reliefs people most often miss.
Each of these reliefs rests on facts IRAS can ask you to prove: that a parent lives with you, that you spent the required amount, or that a grandparent cares for your child. Keep bank transfer records for allowances, receipts for medical bills you paid, and proof of address. Shu Ting set up a standing transfer to her mother with a clear reference, so that a year of support sits in one place in her statements.
For the activity, list everyone in your family you support and the relief each one could give, then write down who should claim it, using your marginal rates from lesson 1.4.
List the family members you support and the relief each could give, and who in the family should claim it.
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