To date, the Government has, among a broader range of measures, introduced certain tax benefits in its efforts to foster an overall pro-family environment in Singapore . On the tax front, existing tax benefits are substantially enhanced to provide greater financial support to parents in raising children. With effect from the Year of Assessment (“YA”) 2009, the quantum of Qualifying Child Relief and Handicapped Child Relief will increase to $4,000 and $5,500 respectively for each qualifying child. Working mothers with qualifying Singaporean children will enjoy higher Working Mother's Child Relief. The Parenthood Tax Rebate currently available only for the second to fourth qualifying Singapore child in a family will be extended to the first child and beyond the fourth child.
We summarise below the changes made to the existing personal reliefs and parenthood tax rebates.
1. Qualifying Child Relief (“QCR”) / Handicapped Child Relief (“HCR”)
With effect from YA 2009, for parents with qualifying children, the QCR will increase from $2,000 to $4,000 per child and the HCR from $3,500 to $5,500 per child and the QCR is now extended to all qualifying children.
| Order of Qualifying Child |
QCR (Per Child) |
HCR (Per Child) |
YA 2008$ |
YA 2009$ |
YA 2008$ |
YA 2009$ |
| 1 st child to 3 rd child |
2,000 |
4,000 |
3,500 |
|
| 4 th child |
2,000 (child born on or after 1 January 1988) |
4,000 |
3,500 |
5,500 |
| 5 th and subsequent child |
0 |
4,000 |
3,500 |
5,500 |
2. Working Mother's Child Relief (“WMCR”) Currently, the WMCR for the first, second, third and fourth child are 5%, 15%, 20% and 25% of the working mother's earned income respectively. With effect from YA2009, WMCR will increase to 15% and 20% of the working mother's earned income for the first and second child respectively and 25% per child for the third and subsequent child. The WMCR will be subject to an overall cap of 100% of the working mother's earned income for all her qualifying children.
Order of Qualifying Child |
WMCR (Per Child) |
YA 2008 |
YA 2009 | |
1 st child |
5% of earned income |
15% of earned income |
2 nd child |
15% of earned income |
20% of earned income |
3 rd child |
20% of earned income |
25% of earned income |
4 th child |
25% of earned income (child born in or after 1987 but excludes child adopted before 1 January 2004) |
25% of earned income |
5 th and subsequent child |
0% |
25% of earned income |
Maximum claim allowable |
QCR/HCR plus WMCR is capped at $25,000 per child |
QCR/HCR plus WMCR is capped at $50,000 per child (Cumulative WMCR percentages are capped at 100% of the working mother's earned income) |
3. Parenthood Tax Rebate (“PTR”)
PTR is a lump sum rebate that can be used to offset the income tax payable of married Singapore tax residents and may be shared between spouses based on the apportionment agreed by both parties. Unutilised PTR can be carried forward to offset future income tax payable until it is fully utilised.
YA 2008
Parents can claim PTR if he/she is a married Singapore tax resident (including divorced and widowed individuals) and the qualifying child is
(a) A 2nd , 3rd or 4th legitimate child
- born to his/her family on or after 1 January 2004; and
- becomes a Singapore citizen at the time of birth or within 12 months thereafter.
(b) A 2nd , 3rd or 4th illegitimate child
- born on or after 1 January 2004 and whose birth occurs before the marriage of the natural parents; and
- whose natural parents become lawfully married before he reaches 6 years old; and
- becomes a Singapore citizen at the time of marriage of his natural parents or within 12 months thereafter.
(c) A 2nd , 3rd or 4th child
- legally adopted on or after 1 January 2004 but before 1 January 2006; or
- legally adopted on or after 1 January 2006 but before he reaches 6 years old; and
- becomes a Singapore citizen at the time of legal adoption or within 12 months thereafter.
The amount of PTR allowable is as follows.
Order of Qualifying Child |
PTR Allowable (Per Child) $ |
1 st child |
0 |
2 nd child |
10,000 |
3 rd child |
20,000 |
4 th child |
20,000 |
5 th and subsequent child |
0 |
YA 2009 With effect from YA 2009, parents can claim PTR if he/she is a married Singapore tax resident (including divorced and widowed individuals) and the qualifying child is
a) A legitimate child
- born to his/her family on or after 1 January 2008; and
- becomes a Singapore citizen at the time of birth or within 12 months thereafter.
- An illegitimate child
b) An illegitimate child
- born on or after 1 January 2008 and whose birth occurs before the marriage of the natural parents; and
- whose natural parents become lawfully married before he reaches 6 years old; and
- becomes a Singapore citizen at the time of marriage of his natural parents or within 12 months thereafter.
c) A child
- legally adopted on or after 1 January 2008 but before he reaches 6 years old; and
- becomes a Singapore citizen at the time of legal adoption or within 12 months thereafter.
The amount of PTR allowable is as follows.
Order of Qualifying Child |
PTR Allowable (Per Child) $ |
1 st child |
5,000 |
2 nd child |
10,000 |
3 rd child |
20,000 |
4 th child |
20,000 |
5 th and subsequent child |
20,000 |
Since PTR is to be claimed in the Year of Assessment immediately following
1.- the year of birth for legitimate child;
2.- the year of adoption for legally adopted child; or
3.- the year of marriage of the natural parents for illegitimate child,
the above enhanced PTR will only be allowable to parents of qualifying children born or legally adopted on or after 1 January 2008.
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