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Parliamentary Replies

Tax Treatment of Full-time National Servicemen Allowances

03 Oct 2022

Parliamentary Question by Mr Leon Perera: 

To ask the Deputy Prime Minister and Minister for Finance (a) what is the number of full-time national servicemen (NSF) whose parents qualify for tax relief stemming from child caretaking duties, such as the Qualifying Child Relief (QCR) or Working Mother Child Relief (WMCR) in the past five years; (b) what is the rationale behind the $4,000 annual income cap of the child under the QCR and WMCR; and (c) whether the Ministry will consider treating NSF allowances like other forms of allowances, such as transport and meal allowances for tax purposes.

Parliamentary Reply by Deputy Prime Minister, and Minister for Finance Mr Lawrence Wong:

The Qualifying Child Relief (QCR) is given to taxpayers to recognise their efforts in supporting their children. The Working Mother’s Child Relief (WMCR) is given to encourage women to continue working after their marriage and childbirth, and to encourage more births. 

Given the objective, the child must be unmarried and financially dependent on the parent (i.e. not earning any income), and meet the following criteria:

a.         Below 16 years old; or

b.         Studying full-time at any university, college, or other educational institution at any time in the year.

As a concession, like all other dependant tax reliefs[1] (e.g. Parent Relief), children who derive incidental income can qualify as a dependant if their income is not more than $4,000 a year.

The number of NSFs whose parent(s) had QCR and/or WMCR claims allowed in respect of them in the last five years is in Table 1.

Table 1: Number of NSFs whose parent(s) claimed QCR and/or WMCR in respect of them

Year of Assessment (YA)

Number of NSFs whose parent(s) claimed QCR and/or WMCR in respect of them:











NSFs receive an allowance to support their basic personal upkeep, including for transport and incidentals. Lodging, food, clothing, and medical care are provided for by the Singapore Armed Forces as most NSFs stay in camp. Hence, they are not considered financially dependent. However, in line with the concession, if they receive a total NS allowance and income of less than $4,000 in a particular year (e.g. because they were in national service for only part of the year), they could qualify as a dependent for QCR and WMCR.

On the suggestion to treat NSF allowances like transport and meal allowances for tax purposes, this is already the case. NSF allowances, like fixed monthly transport and meal allowances, are considered income and subject to tax if the individual’s chargeable income is $20,000 or more.

[1] with the exception of handicapped dependant tax reliefs (e.g. Handicapped Sibling Relief).