Tax season is here! Are you all geared up for it?
For some, it can be a stressful time filled with anxiety and confusion; for others, it’s a time of reflection and planning for the future.
Regardless, it’s important to understand the ins and outs of our tax system, including the different types of taxes, tax reliefs and deductions.
What are the latest tax rates?What are the tax reliefs you can apply for now?What are the tax treatments for property rental income?
In this article, we’ll take a closer look at everything you need to know to make it through the season with ease.
What are the current personal income tax rates:
The tax rates in Singapore are progressive, which means that the tax rates increase as the income level of an individual increases. In other words, individuals with higher incomes are taxed at a higher rate compared to those with lower incomes. This progressive tax system can help ensure that the tax burden is distributed more fairly across different income groups.
The tax rates for individuals in Singapore range from 0% to 24%, with higher rates applied to higher income brackets.
As you can see, for income $20,000 and below, your income tax rate is 0%. As you progress through the income brackets, your income tax rates increase.
For example, if your chargeable income is $100,000, your marginal tax rate is 11.5% for the income on top of $80,000. Your tax payable is $3,350 + 11.5% x $(100,000 – 80,000) = $5,650.
This year, the government has added 2 more tax brackets: from $500K to $1m and income in excess of $1m.
Source: IRAS
Let’s talk about income tax relief
Now comes our favourite part – tax reliefs.
If you are a middle- to high-income earner, you’ll feel that income tax is a significant pain. Of course, there are ways to lower your taxable
