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Tax benefits for 'stay at home' mum

26 May 2005

I refer to Ms Vicky Chong's letter, 'Nothing for this 'stay at home' mum' (ST, May 12). Ms Chong mentioned that while she and her husband received a Special Tax Rebate of $20,000 for their third child, her husband will not be able to use it up in full before it expires and she will need to work before she can claim it.

I would like to inform her that under the 2004 marriage and parenthood package, if she has unused Special Tax Rebate as at Year of Assessment 2005, the unused rebate (which has an expiry period of nine years) will be converted automatically to the same amount of Parenthood Tax Rebate, which has no expiry date. The Parenthood Tax Rebate can be claimed either by her or her husband.

There is also a Further Tax Rebate (FTR) of 15 per cent of the mother's earned income for the third and fourth child each if the child is born before 2005. The FTR is claimable only by working mothers as it was introduced in lieu of paid maternity leave.

It has been replaced by the Working Mother's Child Relief from Year of Assessment 2005. The expiry period of nine years continues to apply to existing FTR claimants.