STOP being helpless on taxable income!

It’s the JOLLY time of the year. Okay, wait. It’s time to count your sums and make your contributions / top up for the Assessment Year 2023 for income tax.

If you don’t know how to get started, here’s 3 quick tip of what I always do to figure out how much is my taxable income.

1️⃣ Use the Income Tax calculator from IRAS. It’s an excel spreadsheet, simply key in your income and deductions.

2️⃣ Always find out what is your pay received as of date (remember to include your year end bonuses if any)

3️⃣ Figure out your employee contribution for the year.

After figuring out the big items, I always visit the IRAS page to update myself on the deductibles. Do note that not everything is automatically updated, so when you file your income tax, you need to know exactly what to fill in. For me, I always use this 3 main ways to reduce the taxable incomes.

1️⃣ SRS contribution / Top up of CPF accounts. There is a limit of 15.3k for SRS, and top up limit 8k for self, and for loved ones. (I subsequently invest my SRS on T-bills )

2️⃣ donations. When I find the right organisation to donate for a good cause, I make a donation and double check that it is tax deductible.

3️⃣ Parent relief. This only applies if your parents are no longer working. If you stay with them, you get to claim up to $9k per parent if you are staying with them, and $5.5k if you are not staying with them.

Note: if you have siblings, make sure no one is claiming for this too, or just split the claims. otherwise there may be a penalty.

There are of course many other ways, so do check out the IRAS website. However, note there is a cap of $80k tax relief a year, and all these donations / top up / SRS must be done before 31 Dec 2023 for them to help reduce your Assessment Year 2023 income Tax.

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