Wednesday, September 30, 2015

Tax Change (For rental expense) with effect from YA 2016

(Simplification of Claim of Rental Expenses for Individuals)

5.1 To simplify tax filing and ease the burden of record keeping for taxpayers, it
was announced in the Budget 2015 that with effect from YA 2016, an
individual may opt on a yearly basis to deduct an amount of deemed
expenses, in lieu of the actual amount of deductible expenses incurred,
against his passive rental income from the letting of a residential property in
Singapore. An individual who has opted to deduct an amount of deemed
expenses against his rental income can in addition, make a claim for
deduction on allowable interest expenses, if any.

5.2 The amount of deemed expenses allowable in respect of a residential
property is 15% of the gross rental income. This amount of deemed
expenses is considered to be generally in line with the amount of common
rental expenses (such as property tax, property maintenance fees and
minor repairs) that a landlord will incur.