Bernie is aged 45, an Australian citizen and tax resident in Singapore during 2021. She is the

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Question:

Bernie is aged 45, an Australian citizen and tax resident in Singapore during 2021. She is the finance director of Billion Pte Ltd (‘BPL’) and has been in this position since 2020. BPL is a wholly owned Singapore subsidiary of Billion Inc. (‘BI’), a company listed on the London Stock Exchange. In 2021, Bernie derived the following employment income and benefits:

 Monthly salary of $20,000

 Bonus of 15% of her annual salary

 A car with a chauffeur

- The car was leased by BPL on 1 January 2021 at a monthly rental of $2,000. It has a market value of $200,000 and has a residual value of $20,000.

- The total running costs of the leased car, amounting to $12,000, was borne by BPL.

- The total remuneration of the chauffeur in 2021 was $26,000.

- The total mileage for 2021 was 30,000 km.

- 20% of the total mileage was for Bernie’s private use.

 A fully furnished apartment rented by BPL at a monthly rental of $6,000. Bernie paid a monthly rental of $2,000 for the apartment.

 A birthday gift costing $180

 A waiver of a $50,000 loan that was granted to her when she commenced employment in Singapore in 2020

In addition to her employment income, Bernie also derived the following income during the year 2021:

 Rental income of $20,000 from the renting of her house in Melbourne, Australia. The monies were received in her Singapore bank account.

 Interest income of $6,000 from a deposit placed in a pawnshop in Singapore.

 Dividend income of $1,000 from a Bermuda company. There is no corporation tax or withholding tax in Bermuda.

Bernie bought a life insurance policy from a Singapore based insurance company in 2020 on her own life. The insured value is $1 million, and the annual premium is $6,000.

Required:

a) Calculate Bernie’s income tax liability for the year of assessment 2022. Note: You should list all items referred to in the question, indicating by the use of zero (0) any item which does not require adjustment. (13 marks)

b) Explain the tax treatment of the following items in the hands of the employees:

(i) Remuneration received during study leave; and

(ii) Cost fee subsidy of $1,000 and this scheme is available to all employees