SUMMARY TABLE ON PROPOSED NON-BUDGET CHANGES TO THE INCOME TAX ACT s/n. Legislative Change Brief Description of Legislative Change Amendment to Income Tax Act [Clause in Income Tax (Amendment) Bill] Allow tax exemption on Supplementary Retirement Scheme (“SRS”) withdrawal upon death or terminal illness To exempt from tax an SRS member’s SRS savings of up to $400,000 for a deemed withdrawal made upon death, or a withdrawal in full made on grounds of terminal illness. This is to ensure that the SRS member is not unduly disadvantaged by the withdrawal. The change will be effective from YA 2016. Section 10L [Clause 7] Ensure that a dependant is the subject of claim of only one dependant-related personal income tax relief To clarify that a dependant can be the subject of claim of only one dependant-related personal income tax relief, with the exception of the Grandparent Caregiver Relief and Working Mother’s Child Relief. This is to align the tax treatment of all dependant-related reliefs and to ensure consistency by disallowing a dependant from being the subject of multiple dependant-related relief claims. Section 39 [Clause 25] Align the interest rate used in calculating the interest payable by the Comptroller in specified scenarios to the Prime Lending Rate To align the interest rate payable by the Comptroller on a refund of tax withheld (pending the determination of an appeal by the Comptroller against an order or a decision by the Income Tax Board of Review or by a court) to the Prime Lending Rate adopted by the Government in respect of monies owed to and by the Government. Section 93 [Clause 40] Align the personal income tax rate for non-tax-resident individual taxpayers to the top marginal personal income tax rate of 22% To align the various individual non-tax-resident / Hindu joint family tax rates to the top marginal personal income tax rate of 22% with effect from YA 2017. Sections 43, 45 and 45B [Clauses 26, 35 and 36]
Empower the Comptroller to obtain information through electronic services To empower the Comptroller to require information to be furnished through e-services provided by the Comptroller. This will increase IRAS’ efficiency and effectiveness in revenue administration and help to streamline tax compliance for taxpayers. Sections 8A and 65B [Clauses 4 and 38] Impose compulsory e-filing for withholding tax To make electronic-filing of withholding tax compulsory for filings made from 1 July 2016 and to empower the Comptroller to exempt any person from compulsory e-filing under certain circumstances. This is in line with the Government’s direction for more cost effective delivery of public services. Sections 8A, 45 and 45D [Clauses 4, 35 and 37] Amend the provisions relating to implementation of Foreign Account Tax Compliance Act (“FATCA”) To facilitate FATCA implementation, the ITA will be amended to: Clarify that Reporting Singaporean Financial Institutions are allowed to collect, use and disclose data for FATCA purposes; Clarify that Reporting are allowed to disclose information on payments to Non-participating Financial Institutions to their immediate payers; Clarify that IRAS has the power to extend the deadline for Reporting SGFIs to submit FATCA data, subject to certain terms and conditions as it may impose; and Provide IRAS with the power to engage third parties to perform FATCA related due-diligence inspections on SGFIs. Sections 105L, 105N and 105PA [Clauses 44, 45 and 46] Allow the Comptroller to share income information with IRAS for preventing abuse of Wage Credit To provide a statutory exception to enable the Comptroller to share income information of taxpayers/ employers with IRAS for the purpose of preventing abuse of the WCS or other non-tax grant schemes administered by IRAS. Section 6 [Clause 3]