It is the Government’s policy to keep our Personal Income Tax regime competitive and progressive. This encourages employment, innovation and enterprise, while ensuring that higher-income earners pay higher taxes.
What are the Personal Income Tax rates?
The amount of Personal Income Tax payable depends on the amount of income earned in the year and the amount of tax deduction, tax reliefs and tax rebates applicable in each individual case.
Please refer to IRAS’ website for the prevailing Personal Income Tax rate structure and other details on Personal Income Tax.
What Personal Income Tax reliefs and rebates are available?
The various types of Personal Income Tax reliefs are in line with our social objectives, such as taking care of elderly parents and saving for retirement. The tax reliefs can reduce one’s taxable income. There is also the Parenthood Tax Rebate, which is given to encourage the birth of Singaporean children after marriage.
Please refer to IRAS’ website for more details.
What is the Personal Income Tax relief cap and how does it work?
The Personal Income Tax relief cap serves to keep our tax system progressive. It puts an overall cap on the amount of tax reliefs that an individual can claim at $80,000 per Year of Assessment.
Does the Personal Income Tax relief cap apply to donations?
The tax relief cap does not apply to tax deduction for donations, as this is not a Personal Income Tax relief.
Personal Income Tax Reliefs and Rebates
The Government provides various tax reliefs and rebates to promote certain social objectives, such as encouraging marriage and family formation, recognition for taxpayers who support their dependants, and saving for retirement.
Please refer to IRAS’ website for more details.
Personal Income Tax Relief Cap
Over the years, the Government has introduced and enhanced reliefs significantly. Today, there are 15 tax reliefs. Each relief serves an objective. But, taken together, the reliefs can unduly reduce the taxable income.
Budget 2016 saw the introduction of a $80,000 tax relief cap per Year of Assessment. Ninety-nine per cent of tax residents can claim their reliefs without being affected by the cap, including 9 out of 10 working mothers who claimed the Working Mothers’ Child Relief. The remaining one per cent of tax residents who are expected to be affected, can still enjoy tax reliefs, up to a cap of $80,000 per year of assessment.
The Government remains committed to supporting Singaporeans in fulfilling their marriage and parenthood aspirations. Over the years, the Government has added and significantly enhanced various schemes to support parents in having children.
The tax relief cap is to keep our tax system progressive. Nonetheless, even with the cap, our tax burden remains competitive.
The tax relief cap does not apply to the tax deduction for donation. This deduction is not a personal income tax relief.
Tax Deduction for Donations
With effect from 1 January 2005, double tax deductions will be granted for all cash donations to Institutions of a Public Character (IPCs) or the Singapore Government, and certain in-kind donations to approved beneficiaries, whether or not they involve naming opportunities. Prior to 1 Jan 2005, donations with naming opportunities would only be granted a single tax deduction. The extension of the double tax deductions to include donations with naming opportunities is meant to encourage more donors to come forward, to give larger donations, and to cultivate lasting relationships with the beneficiaries they have lent their names to.
The table below further elaborates on the types of donations that will be granted double tax deduction. Other forms of in-kind donations that do not fall under the list will not be awarded double tax deduction.
|Donation Scheme||Eligible Recipient||Eligible Donor|
|Cash donations||Approved IPCs and the Singapore Government||All donors|
|Gift of shares listed on the Singapore Exchange (SGX) or of units in unit trusts traded in Singapore||Approved IPCs||Individual donors only|
|Gifts of computer hardware, software and peripherals||Approved IPCs and prescribed educational, research or other institutions in Singapore||Corporate donors only|
|Gifts of artefacts||Approved museums (by the National Heritage Board)||All donors|
|Donation of public sculptures||The National Heritage Board or approved recipients||All donors|
|Gifts of parcels of land or buildings||Approved IPCs||All donors|
In addition, do note that only the following donations with “naming opportunities” will be granted double tax deduction:
donations to name IPCs, IPC facilities, events or programmes,
donations to name facilities of approved beneficiaries (including artefacts and public sculptures) under any of the other approved donation programmes,
donations under any of the approved donation programme where the IPC or approved beneficiary acknowledges the donation by including the donor's name or logo in the IPC's collaterals (e.g. banners, publications, advertisements).
Double tax deduction will not be given in cases where the donor is essentially advertising at the IPC facility, event or programme. Such forms of advertisement include, but are not limited to, the display of the donor's own banners, products, or other collaterals at the IPC facility, event or programme. Such advertisements might be more appropriately regarded as advertising expenses.
Revision for Donation Scheme on Gifts of Computer Hardware, Software and Peripherals
Tax deduction scheme for donation of computer hardware, software and peripherals will be withdrawn with effect from 21 February 2017. A company that donates computers to a prescribed educational, research or other institution in Singapore and IPC on or after 21 February 2017 would not be eligible for any tax deduction.
Enhancement to deductions on donations
For donations made during the period from 1 January 2009 to 31 December 2015, the tax deduction was enhanced to 250%.
In conjunction with SG50, the Government increased the tax deduction from 250% to 300%, for donations made from 1 January 2015 to 31 December 2015 only.
Tax deduction for donations made from 1 January 2016 to 31 December 2021 will be at 250%. All existing criteria to qualify for tax deduction remain unchanged.