Priscilla Lim, a Singaporean aged 35 is married with 2 schooling children. She is working in Melbourne, Australia since the beginning of 2019. She has not filed any tax return to Inland Revenue of Singapore (IRAS) since then. She has the following income for the calendar year 2020.

1) Priscilla has inherited a property from her late grandfather in 2017 which was a bungalow in Mountbatten Road, Singapore. She sold the property for $1.2 million in August 2020 and paid 2% of the sales value as agent fees. She has not sold any property in Singapore ever before.

2) Employment income of $140,000 was paid to her via an approved bank of Singapore account by her Australian based employer. The interest derived from this account was $550 for the current year.

3) Priscilla owns another property at Marine Parade and earned a rental income of $2000 per month. The rental price had declined due to low demand during Covid 19 pandemic crisis. The property was rented since January 2020 until 31 December 2020. However the deductible rental expenses were $2,400 per month. As a result she had made a rental loss.

Required:

i) For each of the receipts (1) to (3), advise Priscilla Lim of the Singapore tax implications and on whether she can offset her rental loss against her other income.

ii) Advise Priscilla Lim with regards to filing of tax return in Singapore and the consequences of defaulting it;

b) From a Singapore tax perspective:

i) Explain what do you understand by the term accommodation benefit given by employers and its implications on tax for a foreign employee and his/her family members assuming there is no information on rental provided by employer? What are the differences between partly and fully furnished benefits? Cite relevant example for each.

ii) Assume the above property is a leased residential property. What are the implications of GST to the employer?

Answer rating: 100% (QA)

Trading across borders is that the norm within the world today Technology has made it possible for companies to source and operate from anywhere within the world thereby increasing access to world mar... View the full answer