This course will help individual taxpayers to understand their tax
obligations in filing a complete and accurate Income Tax Return.
This course comprises the following topics:
1) Filing an Individual Income Tax Return
2) Tax Obligations of a Self-Employed Person
User Guide in Filing an Individual Income Tax Return
TOPIC 1 : FILING AN INDIVIDUAL INCOME TAX RETURN
FILING AN INDIVIDUAL INCOME TAX RETURN
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Module 1 Income Tax Filing Requirement for Individuals
(excluding Non-Resident and Self Employed Individuals)
Module 2 Income, Deductions and Reliefs Statement (IDRS) and Auto-
Inclusion Scheme (AIS)
Module 3 Declaration of Income
Module 4 Claim for Approved Donations
Module 5 Claim for Tax Deductible Expenses
Module 6 Claim for Reliefs
Module 7 Claim for Parenthood Tax Rebate
Module 8 Common Enquiries
Module 1: Income Tax Filing Requirement for Individuals
(excluding Non-Resident and Self Employed Individuals)
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Scenario Required to file? Remarks
I received a SMS, letter
or form informing me to
file an Income Tax
Return.
Yes
Filing is required regardless of the amount of your annual income in the
previous year or whether your employer is participating in the Auto-
Inclusion Scheme (AIS) for Employment Income.
I received a SMS or
letter notifying that I
have been selected for
the No-Filing Service
(NFS).
No
Filing is not required. Your Notice of Assessment (NOA) or tax bill will be
computed based on your auto-included income and previous year’s
relief claims, which may be adjusted if you do not meet the eligibility
criteria.
It is your responsibility to ensure that your NOA is accurate. If you have
other income that is not shown on the NOA, or your relief claims in the
NOA is incorrect, please inform us within 30 days from the date of your
NOA. Alternatively, you have the option of making the relevant changes
by e-Filing your tax return.
I did not receive any
notification from IRAS to
file an Income Tax
Return.
No This is provided that your annual income derived from/received in
Singapore in the previous year did not exceed $22,000.
Yes Your annual income derived from/received in Singapore
(e.g. employment, rental) in the previous year exceeded $22,000.
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Module 1: Income Tax Filing Requirement for Individuals
(excluding Non-Resident and Self Employed Individuals)
When is the filing due date?
a) Electronic Filing due date
The due date for e-Filing is 18th April of the year. We will pre-fill in the IDRS, all the details of
your income, tax deductible expenses (for example, Zakat), tax deductible donations and reliefs
provided by employers and other organisations who are participating in the Auto-Inclusion
Scheme. All reliefs claimed by you and allowed in your tax assessment for the previous year
(e.g. qualifying child relief, parent relief) will also be pre-filled.
You have to verify that the pre-filled information on your income, deductions and reliefs are
accurate and complete.
You can save a draft of your e-Filing and submit your Income Tax Return later.
Re-filing can be done within 14 days from the date of your original submission or 18th of April,
whichever is earlier.
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Module 1: Income Tax Filing Requirement for Individuals
(excluding Non-Resident and Self Employed Individuals)
When is the filing due date?
b) Paper Filing due date
The due date for paper filing is 15th April of the year.
There will be no pre-filling of income, deductions or reliefs in the paper tax form. Thus, the
features such as re-filing and saving a draft of your filing are not applicable to paper filing.
97% of individual taxpayers prefer e-Filing as it is fast and convenient!
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Module 2: Income, Deductions and Reliefs Statement (IDRS)
and Auto-Inclusion Scheme (AIS)
What is the Income, Deductions and Reliefs Statement (IDRS)?
IDRS is a summary of:
the income, deductions and reliefs information provided by the relevant organisations
directly to IRAS. Please clarify directly with the relevant organisations if you require
more details on the information provided by them.
your rental income declared in your last year's tax return or e-stamped tenancy
records (if any); and
the reliefs claimed and allowed to you previously.
You have to verify that the pre-filled information on your income, deductions and reliefs
are accurate and complete.
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Module 2: Income, Deductions and Reliefs Statement (IDRS)
and Auto-Inclusion Scheme (AIS)
What is the Auto-Inclusion Scheme (AIS)?
Organisations participating in the AIS will transmit information on a taxpayer’s income,
deductions and reliefs electronically to IRAS each year. IRAS will show this information in
the IDRS and automatically include it in the tax assessment. You need not declare such
information in your Income Tax Return.
For example, your employer is participating in the AIS for Employment Income. You do not
need to manually declare your employment income, donations (deducted through
salaries) and CPF relief claim in your Income Tax Return. You only need to declare other
employment income from employers that are not participating in the AIS and any other
income that is not auto-included (e.g. rental income) in your Income Tax Return.
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Module 3: Declaration of Income
What should I do if I encounter the following during e-Filing?
Scenario What you need to do
My employer is in the AIS but my
employment income information is not
shown in the IDRS.
1) Scroll down to the bottom of the IDRS and select “Yes, I
need to edit my Tax Form” and click on “Continue to
Main Tax Form”.
2) Tick the box under “Employment" in Section A of the
Main Tax Form. Your employment income information will
be automatically included in your tax assessment when
we receive the information from your employer.
I worked for two employers in the previous
year but one of them is not in the AIS.
You have to verify the information of the employer
participating in AIS, and declare your employment income,
donations (deducted through salaries) and CPF relief claim
from the employer who is not participating in AIS in Section B
of the Main Tax Form .
My employment income information is
reflected in the IDRS but there is
discrepancy in the figures.
You have to seek clarification from your employer on the
discrepancy. We will take into account any subsequent
transmission from your employer when we finalise your tax
assessment. You can still proceed to file your Income Tax
Return.
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Module 3: Declaration of Income
What should I do if I encounter the following during e-Filing?
Scenario What you need to do
I have rental income which is not
shown in the IDRS.
1) Scroll down to the bottom of the IDRS and select
“Yes, I need to edit my Tax Form” and click on
“Continue to Main Tax Form”.
2) You will see the Main Tax Form. Click on “Rent from
Property” under item “4. Other income”.
3) You have to declare the gross rent and details of
the deductible expenses for each property.
Module 4: Claim for Approved Donations
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Cash donations made to any approved Institution of a Public Character (IPC) or the Singapore
Government that benefits the local community are tax-deductible.
For more information on the other types of donations (e.g. shares, artefacts) that are tax-deductible, please
refer to our website at https://www.iras.gov.sg :
Home > Individuals > Locals > Deductions for Individuals (Reliefs, Expenses, Donations) >
Deductions on Donations > Donations
You are required to provide your identification number (e.g. NRIC/FIN) when you make donations to the
IPCs in order to be given tax deductions on the donations. IRAS no longer accept claims for tax deduction
based on donation receipts.
Tax deduction for the approved donations will be automatically included in your tax assessment if:
1) You made donations to an approved IPC and have provided your NRIC number/FIN to the IPC at the
point of donation.
2) You arranged for the donations to the deducted from GIRO and have given your NRIC number/FIN to
the IPC at the point of donation.
3) You arranged for the donations to be deducted from your payroll and your employer is under the Auto-
Inclusion Scheme for Employment Income.
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Module 5: Claim for Tax Deductible Expenses
What are the qualifying conditions for tax deductible expenses?
1) The expense must be wholly and exclusively incurred in the production of income.
2) The expense is incurred during the period when the income is derived.
3) The expense must be revenue in nature. Capital expenses are not allowable.
4) The expense must not be for personal purpose.
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Some examples of tax deductible expenses which are not reimbursed by your employer:
(i) Travelling expenses incurred on public transport in the course of carrying out your official
duties
(ii) Entertainment expenses incurred in entertaining clients
(iii) Subscription fees paid to professional bodies or society
(iv) Mosque building fund, zakat, fitrah or any other religious dues authorised by law
Some examples of non tax deductible expenses:
(i) Travelling expenses incurred on private cars
(ii) Travelling expenses incurred to and from home and office
(iii) Entertainment expenses incurred on meals with colleagues
Module 5: Claim for Tax Deductible Expenses
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How to claim Employment Expenses?
You need to enter your employment expenses claim under “employment expenses” in your
Income Tax Return.
In addition, you have to keep complete and proper records of all expenses:
(a) use the “Employment Expenses Schedule” available at our website at
https://www.iras.gov.sg (Home > Individuals > Locals > Deductions for Individuals
(Reliefs, Expenses, Donations) > Deductions for Employees > Employment
Expenses) to record the details of the expenses, and
(b) keep the supporting documents for the expenses (e.g. receipts and invoices).
You only need to submit the above documents upon IRAS’ request.
Module 5: Claim for Tax Deductible Expenses
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Claiming Rental Expenses:
Expenses that are incurred during the rental period are deductible against the rental income.
From 1 January 2015, to simplify tax-filing and reduce the burden of record-keeping, an amount of deemed rental expenses
calculated based on 15% of the gross rent will be pre-filled on the online tax form. In addition to the 15% deemed rental
expenses, property owners can still claim mortgage interest on the loan taken to purchase the tenanted property.
Alternatively, taxpayers can opt to claim the amount of actual rental expenses incurred. The common expenses claimed
against rental income are:
(i) Property tax
(ii) Interest on the loan to finance the purchase of the property
(iii) Maintenance
(iv) Repairs
(v) Fire insurance
If you are claiming rental expenses based on the actual rental expenses incurred, please retain supporting documents such
as tenancy agreements, bank mortgage statements, invoices and receipts for at least 5 years for verification purposes.
You may visit our website at https://www.iras.gov.sg (Home > Individuals > Locals > Deductions for Individuals
(Reliefs, Expenses, Donations) > Deductions on Rental Expenses > Rent from Property > Rental Income and
Expenses) to view the examples.
Module 5: Claim for Tax Deductible Expenses
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Module 6: Claim for Reliefs
You have to ensure that you satisfy all the qualifying conditions of a relief before claiming it in your Income
Tax Return. IRAS will adjust your relief claims from your tax assessment if you do not meet the eligibility
criteria.
If you e-File, IRAS will pre-fill the following reliefs in the Income, Deductions and Reliefs Statement (IDRS):
Reliefs provided by employers and other
organisations who are participating in the Auto-
Inclusion Scheme (AIS)
Reliefs claimed by you and allowed in your tax
assessment for the previous year
• CPF Relief
• Life Insurance Relief
• NSman Relief
• Supplementary Retirement Scheme (SRS) Relief
• CPF Cash Top-up Relief
• Spouse Relief/Handicapped Spouse Relief
• Qualifying Child Relief/Handicapped Child Relief
• Working Mother’s Child Relief
• Foreign Maid Levy Relief
• Grandparent Caregiver Relief
• Parent Relief/Handicapped Parent Relief
• Handicapped Brother/Sister Relief
• Life Insurance Relief
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Module 6: Claim for Reliefs
Reliefs provided by employers and other
organisations who are participating in the Auto-
Inclusion Scheme (AIS)
Reliefs claimed by you and allowed in your tax
assessment for the previous year
If there is discrepancy in the relief amount (for
example, your CPF relief should be $17,000 but is
reflected as $15,000 in your IDRS), you have to seek
clarification from the relevant organisation.
We will take into account any subsequent
transmission from the relevant organisation when we
finalise your tax assessment.
You can still proceed to file your tax return.
If you no longer meet the qualifying conditions for any
of the pre-filled reliefs or wish to amend the relief
amount, please remove the relief / change the relief
amount from the “Deductions and Reliefs” page.
For example, you have stopped hiring a maid in the
year 2015. However, your IDRS was prefilled with the
Foreign Maid Levy relief of $6,360. You should adjust
the amount to $0 at the “Deductions and Reliefs”
page.
What you need to do when you e-File:
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Module 6: Claim for Reliefs
If you file by a paper tax form, IRAS will not pre-fill any relief in your tax form.
You have to enter details for the following relief
claim(s) in your tax form
You need not claim these reliefs in your tax
form. If you are eligible for the relief(s), they will
be automatically included in your tax
assessment based on the information
transmitted from the relevant organisations
• Spouse Relief/Handicapped Spouse Relief
• Qualifying Child Relief/Handicapped Child Relief
• Working Mother’s Child Relief (WMCR)
• Parent Relief/Handicapped Parent Relief
• Grandparent Caregiver Relief
• Handicapped Brother/Sister Relief
• CPF Relief (from employers who are not
participating in the Auto-Inclusion Scheme)
• Life Insurance Relief
• Course Fees Relief
• Foreign Maid Levy Relief
• Earned Income Relief
• CPF Cash Top-Up Relief
• NSman Relief
• Supplementary Retirement Scheme (SRS) Relief
Note: For WMCR claim, indicate “Y” under “Section B, 6(b) Child, Claim for WMCR?” in your tax form and
the relief will be automatically calculated and included in your tax assessment based on your eligibility.
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Module 7: Claim for Parenthood Tax Rebate (PTR)
Child Order Amount of PTR
1st $5,000
2nd $10,000
3rd and beyond $20,000
What is PTR?
PTR is an incentive rebate for married Singapore tax residents to encourage procreation.
PTR can be used to offset your income tax payable.
How much can I claim for PTR?
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Module 7: Claim for Parenthood Tax Rebate (PTR)
If you are claiming PTR for an adopted child or a child born before your marriage, please refer to our
website at https://www.iras.gov.sg (Home > Individuals > Locals > Deductions for Individuals
(Reliefs, Expenses, Donations) > Additional Reliefs/Rebates Available to
Married/Divorced/Widowed Taxpayers > Parenthood Tax Rebate) for the qualifying conditions.
Qualifying Criteria
a) Child must be a Singapore citizen at the time of birth; or
b) attain Singapore citizenship within 12 months from date of birth.
For PTR claim in respect of the first/fifth child, he/she must be born on
or after 1 Jan 2008.
When to claim for the
rebate?
You can file your claim for PTR in the respective Year of Assessment
that the child was born. For example, for a child born in 2015, you can
claim PTR in the Year of Assessment 2016.
Any expiry on the claim of
the unutilised balance?
There is no expiry date on the unutilised balance which is automatically
carried forward to offset your future income tax payable. Any credit
balance remaining is not refundable. This rebate may be shared with
your spouse.
You can claim PTR for a child who was born to you and your spouse:
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Module 7: Claim for Parenthood Tax Rebate (PTR)
How do I claim PTR if I e-File my tax return?
1. At the Main Tax Form, go to item “6-22. Total Deductions And Reliefs”.
2. Click on “Change, remove or make new claims for Deductions, Reliefs and Rebates.
(e.g. Donations, CPF, spouse, child reliefs and Parenthood Tax Rebate)”.
3. Scroll to item “22. Parenthood Tax Rebate (For NEW Claims Only)”.
4. Click on “Claim Parenthood Tax Rebate for a newborn child for the first time”.
5. Enter the percentage of Parenthood Tax Rebate as agreed between you and your spouse.
6. Enter the child order under the Child Order column and your child's Singapore Birth Certificate No./
Citizenship Certificate No.
How do I claim PTR if I file a paper tax form?
1. Fill in the details under item 7 in Appendix 2.
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Working Overseas:
If I am posted to work full-time overseas by my
Singapore employer, is my employment income
taxable in Singapore?
If you are posted overseas for the full calendar year,
your employment income will be tax-exempt in
Singapore unless your overseas posting is incidental to
your Singapore employment or you are posted
overseas on behalf of the Singapore Government.
What do you mean by incidental to your Singapore
employment?
If it is included in your job description that you are
required to travel extensively overseas, then the
income will be taxable in Singapore.
Example, you are a regional Manager who is required
to travel to certain parts of Asia to attend meetings,
trainings etc. Your employment income will be fully
taxable in Singapore.
Do I need to submit any documents to IRAS during
e-Filing?
No.
Module 8: Common Enquiries
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Module 8: Common Enquiries
Filing of Rental Income and Expenses:
My spouse and I co-own a property which was
rented out in the previous year. Can I choose to
declare 100% of the rental income in my name?
Rental income is taxed on all the joint owners
based on their share in the property. It does
not matter which party receives the rent or
whether the owners paid for the property.
Hence, you have to declare rental income
based on your legal ownership in the property.
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Module 8: Common Enquiries
Filing of Rental Income and Expenses:
I have rented out a portion of my property (e.g.
1 room) to my tenants. Do I have to declare
rental income in this instance? If yes, how do I
declare the rental income?
Yes, you are required to declare the rental income and
apportion the claimable expenses incurred based on the
number of rooms rented out.
For example, you are living in a 4-room flat with 3 bedrooms.
You sublet 1 of the rooms to your tenant from 1 Jan to 31 Dec
2015. Your tenant pays you rent of $600 per month. The total
amount of expenses incurred is $3,000.
Your net rent is calculated as follows:
Gross Rent for the year 2015: $600 x 12 = $7,200
Total claimable expenses incurred: $3,000
Total number of rooms in your property: 3 rooms
Total number of rooms rented out: 1 room
Proportion of claimable expenses allowed: $3,000/3 x 1 =
$1,000
Net Rent = Gross Rent – Proportion of claimable expenses
allowed = $7,200 - $1,000 = $6,200
Assuming you own 50% of the property, your share of the
taxable net rent will be $3,100.
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Module 8: Common Enquiries
Filing of Reliefs:
I am working full-time in Singapore and studying
MBA part-time. Can I claim for Course Fee Relief?
Yes, you can claim the actual course fees incurred,
up to a maximum of $5,500 per annum. Your claim
should only include registration or enrolment fees,
examination fees and tuition fees.
I am taking a course on sign language / foreign
language. Can I claim for Course Fee Relief?
You are not eligible for the relief if the course is not
related to your job / you took up the course for your
own interest.
Can I claim Life Insurance Relief for my Health
Insurance, Personal Accident Insurance or Home
Insurance?
No. Life Insurance Relief is only applicable for Life
Assurance Policies.
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e-Filing:
I need to amend the details of my original
e-Filing submission. Can I re-file my tax
return?
I am unable to re-file my tax return as the
e-Filing deadline is over. What should I do
if I have changes to make to my original e-
Filing submission?
Taxpayers are provided a maximum of two attempts to
e-File. You can re-file within 14 days from the date of
your original e-Filing submission or 18 April, whichever is
earlier.
When you re-file, you must include all your income
details and expenses/donations/reliefs claims. Once you
have re-filed successfully, your new submission will
override the previous submission.
You have to email us the details of your
income/expenses/reliefs/rebate for amendment.
Module 8: Common Enquiries
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Foreigners who are re-employed:
Module 8: Common Enquiries
I am a foreigner who returned to Singapore
and worked for a second employer in the
same year. Do I need to file a tax return?
Yes. You must file an Income Tax Return. Please
report the employment income derived from both
employers for the whole year, unless you were
informed during e-Filing that you do not need to
include your employment income that has been
taxed when you ceased employment with your
previous employer.
However, if any of your employers is participating
in the Auto-Inclusion Scheme (AIS), you need not
declare the employment income from the
employer as they would have transmitted the
information to IRAS.
TOPIC 2 : TAX OBLIGATIONS OF A SELF-EMPLOYED
PERSON
General Overview
Module 1 Tax Obligations of a Self-Employed Person
Module 2 Prepare 4-Line Statement
Module 3 File Income Tax
Module 1: Tax Obligations of a Self-Employed Person
Who is a self-employed person
• Individual who carries on a trade, business, profession or vocation
• Sole proprietor of registered business with the Accounting and Corporate Regulatory
Authority (ACRA)
• Partner of a partnership business
Module 1: Tax Obligations of a Self-Employed Person
Responsibilities of a self-employed person
• Keep proper records and accounts
• Complete and submit Income Tax Return by 15 Apr (18 Apr for e-filed returns)
• Pay tax within one month from the date of the Notice of Assessment
Responsibilities of a self-employed person
• Make compulsory medisave contributions if you are:
- a Singapore citizen or Singapore permanent resident; and
- earning a yearly net trade income of more than $6,000.
For more information, refer to our website at https://www.iras.gov.sg (Home >
Businesses > Self-employed / Sole proprietors / Partners > Working Out Your
Taxes > Deductions for Self-Employed / Partners (Reliefs, Expenses, Donations) >
CPF / Provident Fund Relief: Compulsory and Voluntary Medisave Contributions)
Module 1: Tax Obligations of a Self-Employed Person
Responsibilities of a self-employed person
• Register with IRAS as a GST-registered person if:
- revenue exceeded $1 million in the last 12 months; or
- revenue for next 12 months expected to exceed $1 million
Refer to the courses: GST Introduction and GST Before I register for more
information on GST registration.
Module 1: Tax Obligations of a Self-Employed Person
Record Keeping Requirements
• Keep proper records and accounts for at least 5 years from end of relevant financial
year
Examples
• Support your records and accounts with invoices, receipts, vouchers and other
supporting documents
Records for financial year Financial year To be kept till
1 Jan 2013 to 31 Dec 2013 2013 31 Dec 2018
1 Apr 2013 to 31 Mar 2014 2014 31 Dec 2019
Module 1: Tax obligations of a Self-Employed Person
Record Keeping Requirements
• Estimates and improper records not acceptable
• No need to forward records unless they are requested for verification purposes
For more information on record keeping, refer to our website at https://www.iras.gov.sg
(Home > Businesses > Self Employed/ Sole Proprietors/ Partners > Learning the
Basics > Keeping Proper Records and Accounts)
Module 1: Tax obligations of a self-employed person
Accounting Period
• Accounting period must be decided for tax filing purposes
• Accounting period is the period for which you calculate your profits or losses of
your business
• Ends on 31 December each year or date other than 31 December
Example 1
• Business commenced on 1 April 2011
• accounting period ends on 31 December every year
1st Accounting Period 01 Apr 2011 to 31 Dec 2011 Year of Assessment 2012
2nd Accounting Period 01 Jan 2012 to 31 Dec 2012 Year of Assessment 2013
3rd Accounting Period 01 Jan 2013 to 31 Dec 2013 Year of Assessment 2014
Module 2: Prepare 4-Line Statement
1st Accounting Period 01 Apr 2011 to 31 Mar 2012 Year of Assessment 2013
2nd Accounting Period 01 Apr 2012 to 31 Mar 2013 Year of Assessment 2014
3rd Accounting Period 01 Apr 2013 to 31 Mar 2014 Year of Assessment 2015
Accounting Period
Example 2
• Business commenced on 1 April 2011
• accounting period ends on 31 Mar every year
Module 2: Prepare 4-Line Statement
Statement of Accounts
At the end of every accounting period, prepare the statement of accounts to determine
your business income. The statement of accounts is made up of:
• Trading and Profit and Loss Accounts
• Balance Sheet
• Certified and signed by the self-employed person, indicating that the accounts are
true and correct
• Certified by the precedent partner for partnership
For more information on preparing statement of accounts, refer to our website at
https://www.iras.gov.sg (Home > Businesses > Self Employed/ Sole Proprietors/
Partners > Filing Your Taxes > Preparing Statement of Accounts)
Module 2: Prepare 4-Line Statement
4-Line Statement
After you have prepared the statement of accounts, you are now ready to calculate your
business income using the following formula
Revenue XX
Less: Cost of Goods Sold (XX)
Gross Profit XX
Less: Allowable Business Deduction (XX)
Adjusted Profit/(Loss) XX
Module 2: Prepare 4-Line Statement
1. Revenue (Total sales/Income) Total payment/fees/commissions received
or receivable for services provided before
deducting any expenses
2. Gross profit/Loss For a trading business, gross profit is the
revenue less cost of goods sold.
For a service business, this is the same as
Revenue.
3. Allowable business expenses Expenses incurred wholly and exclusively
in the production of your income
4. Adjusted profit/Loss Gross profit – Allowable business
expenses
Module 2: Prepare 4-Line Statement
4-Line Statement
Annual Revenue Tax filing requirements
< $100,00 Report 2-line statement :
• Revenue
• Adjusted Profit/Loss
Between $100,000 and $500,000 Report 4-line statement:
• Revenue
• Gross Profit/Loss
• Allowable Business Expenses
• Adjusted Profit/Loss
Module 2: Prepare 4-Line Statement
Tax Filing Requirements
Fixed Asset Schedule
(1) A description of the asset
(2) Cost of the asset;
(3) Whether paid in cash or on hire-purchase terms;
(4) Date of purchase;
(5) Date of sale
Annual Revenue Tax filing requirements
> $500,000 (i) Report 4-line statement;
(ii) submit certified statement of accounts; and
(iii) Submit fixed asset schedule*
• applicable only when claiming capital allowances on business assets
Module 2: Prepare 4-Line Statement
Tax Filing Requirements
Allowable Business Expenses
Generally, you can claim a deduction against your business income for expenses that
you incur wholly and exclusively to earn your business income.
There are some basic rules for deduction:
• Expense must be related to your business
• Expense must be Incurred in the production of income
• Expenses that are capital in nature cannot be claimed
• Expenses that are personal and private in nature cannot be claimed
Module 2: Prepare 4-Line Statement
Examples of Allowable Business Expenses
• Business running costs (e.g. rental, utilities, book-keeping fees)
• Stationery, printing & postage fees
• Repair & maintenance of assets for business use
• Subscription to professional bodies & trade associations
• Cost of hiring (e.g. employee’s salary, bonus & compulsory CPF contribution by
employer)
• Public transport incurred in the course of business
• Business entertainment (e.g. for suppliers & customers)
• Capital allowances on fixed assets
• Renovation & refurbishment of business premises
• Pre-commencement revenue expenses
Module 2: Prepare 4-Line Statement
Examples of Disallowable Expenses
• Donations to charities & gifts to non-customers
• Capital costs (e.g. purchase of fixed assets, hire-purchase instalments)
• Private expenses (e.g. own medical expenses)
• Fines for breach of law (e.g. CPF late payment, interest, fines)
• Sole-proprietor’s & partner’s salary, bonus, CPF & medisave contributions
• All expenses in respect of private vehicles (even if it is incurred in the course of
business)
• Entertainment of family members & friends
For more information on the rules and deductions to save tax, refer to our website at
https://www.iras.gov.sg (Home > Businesses > Self-employed / Sole Proprietors /
Partners / Working Out Your Taxes > Deductions for Self-Employed / Partners
(Reliefs, Expenses, Donations) > Business Expenses)
Module 2: Prepare 4-Line Statement
Adjusted Profit
The adjusted profit to be reported for tax filing is usually different from the net profit
reported in the accounts.
The following may have been included in the profit and loss account:
• Non-trade income
• Expenses that are not deductible for income tax purposes
Adjustments have to be made to the accounting net profit / loss to:
• Exclude the non-trade income
• Add back disallowable expenses
• arrive at the adjusted profit / loss
Module 2: Prepare 4-Line Statement
Examples of non-trade income
Bank interest from deposits with approved banks or licensed finance
companies in Singapore – do not report interest income as it is exempt
Gain / profit on sale of fixed assets – do not report gain / profit as it is
capital in nature and not taxable
Rental income – exclude from business income and report as a separate
income source “Rent from Property” in the Income Tax Return
Module 2: Prepare 4-Line Statement
Template for Computation of Adjusted Profit / Loss
Located at centre page of “Guide on Filing of Income Tax Return”
Available at our website at https://www.iras.gov.sg (Home > Businesses >
Self Employed/ Sole Proprietors/ Partners > Working Out Your Taxes >
Calculating and Reporting Business Income)
Submit the template together with Form B and the certified Statement of
Accounts if business revenue is $500,000 or more
Module 2: Prepare 4-Line Statement
Module 3: File income tax
Filing income tax return (Form B)
• File your income tax return if your annual net trade income in previous year is more
than $6,000
• Net trade income refers to your gross trade income less allowable business
expenses, capital allowances and trade losses as determined by IRAS
• Report the 2-line statement or 4-line statement of your business
• File by 15 Apr (18 Apr for e-filed returns)
Filing income tax return (partner)
• Report your share of the partnership income in the Form B under “Trade,
Business, Profession or Vocation” as follows:
- share of divisible profit/loss
- Partner’s salary, bonus & CPF
- Partner’s other benefits
- Your share of other income from the partnership
• Your share of the partnership income will be added to other income and the total
income after deducting personal reliefs and rebates, will be taxed at individual
income tax rates.
For more information on how to file your personal income tax return, refer to course on
Form B.
Module 3: File income tax
Filing income tax return (precedent partner)
• file income tax return (Form B)
• file the income tax return of partnership (Form P)
• inform all partners of their share of income from the partnership
The precedent partner is:
• the partner who, among all the partners present in Singapore, is the first named in
the partnership agreement.
• if there is no partnership agreement, the precedent partner is a partner who is
agreed upon and appointed by the other partners to be the precedent partner.
For more information on filing tax for partnership, refer to our website at
https://www.iras.gov.sg (Home > Businesses > Self Employed/ Sole Proprietors/
Partners > Learning the Basics > Basic Guide for New Partnerships) and the
course on Form P.
Module 3: File income tax
Module 3: File income tax
Expense
category
Common mistakes The right way
Entertainment Not keeping complete
records of expenses
Claiming estimated
expenses
Claiming personal
and private expenses
Record all expenses
Record the following details:
‾ Date and place of entertainment
‾ Name of the person(s) entertained
‾ Purpose of entertainment
‾ Identity of person incurring it
‾ Amount incurred
Keep receipts
Claim actual expenses incurred in the
production of income
Exclude personal and private expenses
Common Filing Mistakes
Module 3: File income tax
Common Filing Mistakes
Expense
category
Common mistakes The right way
Transport Claiming private car
expenses
Not keeping
sufficient or complete
records to
substantiate claim for
public transport
Not to claim expenses on private car
usage, as it is prohibited from deduction
under the Income Tax Act, even if the
expenses are incurred for business
purposes
Record details like:
Date of expense incurred and
destination
Mode of transport
Identity of the person incurring it
Purpose of travel
Amount incurred
Keep taxi receipts for verification
Module 3: File income tax
Common Filing Mistakes
Expense category Common mistakes The right way
Personal and
private expenses
Claiming personal and private
expenses as business expenses
Examples are:
Medical expenses incurred for
the sole-proprietor / partners
Salaries paid to the sole-
proprietor / partners
Income tax of sole-proprietor /
partners
Insurance premiums for
policies taken on the sole-
proprietor / partners’ lives
Gifts to family members /
friends
Exclude personal and
private expenses not
incurred in the production
of income
Module 3: File income tax
Common Filing Mistakes
Expense
category
Common mistakes The right way
Payments to
related parties
Making unsubstantiated claims to
related parties
Claim expenses incurred for
your business and based
on actual amounts
Miscellaneous /
General
expenses
Not keeping complete records of
expenses
Claiming estimated expenses
Record details like:
Date incurred
Name of the payee
Purpose of payment
Amount incurred
Keep receipts
Claim actual expenses
incurred (not estimated)
Module 3: File income tax
Common Filing Mistakes
Expense
category
Common mistakes The right way
Partner’s
expenses in
Form B
Claiming the partnership
business expenses as your own
expenses
Not to claim expenses that are
charged to the partnership’s Profit
and Loss Account (in Form P) as
your own expenses as a partner in
Form B
For more information on common mistakes to avoid when filing self-employed income,
refer to our website at https://www.iras.gov.sg (Home > Businesses > Self Employed/
Sole Proprietors/ Partners > Filing Your Taxes > Common Filing Mistakes)