parents relief

Claiming Parents relief


Parents relief is a tax relief given to individuals who are supporting their parents. It is the time of the year where you need to file for your yearly tax return, and also due to the government wants to promote filial piety as population grows old. This is also a long term plan to reduce the burden of the government when the generations entering into old age.

Now let us look at some of the countries that provide parents relief.

Singapore is a good example that we can look at. In Singapore, individuals are able to claim for tax relief for parents, grandparents, parents-in-law and/or grandparents-in-law, not without the below requirements;

  1. The dependent is living in Singapore* in 2015.

    *”Living in Singapore” means that the dependent is staying in Singapore permanently, except for temporary absences (e.g. short overseas vacation) in 2015. In the case of a foreign dependent: generally, if he/ she stays in Singapore for a period of at least 8 months in 2015, he/ she will be regarded as living in Singapore.

  2. The dependent is living in your household. If the dependent lived in a separate household in Singapore in 2015, you must have incurred $2,000 or more in supporting him/her in that year.
  3. The dependent is 55 years of age or above in 2015. If not, he/she must have been physically or mentally disabled.
  4. The dependent does not have an annual income* exceeding $4,000 in 2015. This income threshold is not applicable for handicapped dependents.
  5. *Annual income includes the following:
    1. taxable income (e.g. trade, employment, rental and SRS withdrawals);
    2. tax exempt income (e.g. bank interest, dividends and pensions); and
    3. foreign-sourced income (regardless of whether it has been remitted to Singapore).
  6. From YA 2015 onward, Parent Relief / Handicapped Parent Relief may be shared with other claimants provided no one else is claiming any other relief (except Grandparent Caregiver Relief ) on the same dependent.

The above requirements are definitely well-balanced and do make a lot of sense. And let us check out the amount of the parents relief.

YA 2010 to YA 2014From YA 2015
Taxpayer Stays with Dependant $7,000 per dependant$9,000 per dependant
Taxpayer Does Not Stay with Dependant$4,500 per dependant$5,500 per dependant

That is quite a good amount of parents relief that can be enjoyed by individuals. For individuals who have siblings, can also consider this strategy in order to be benefited from the parents relief. An individual shall claim one of the parent, say, father, and his or her sibling will claim the next, say, the mother. Or you could share the parents relief in the below example cited by IRAS (Singapore);

Your father who has no income lives with your two brothers and all three of you maintain him. You and your brothers can share the claim equally or based on the agreed amount. For example, $3,000 each or $6,000, $2,000 and $1,000 respectively.

So if you are filing the tax returns, pay attention to what you can claim on tax relief, especially the parents relief, allowed by your government.



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