Should I accept cash or benefits?

[Paradox]

I am in the process of negotiating a package to move from UK to Singers. My employer are happy to be led as to construction of the package (with regard to breakdown, mode of payment and so on within a total financial value). Am I better off taking this total amounts as cash (s$180k) or as its component rental, schooling, car, homeleave etc? I believe that as cash it would be taxed as extra income whereas with benefits it would be taxed differently? any ideas on this? Also any suggestions or experience on putting these things together with regard to currency to be paid in, taxyear implications of moving half way through a tax year and so on. Much appreciated.

[equalization]

I would say benefits plus cash difference with a stipulation that the company provides tax equalization. By asking for benefits and not all cash, you still get to make the choices, but the company does get better tax breaks so it makes the equalization a little easier to get. Good luck!

[Europe]

S$180 is a reasonable package, but optimizing around it could get you more into your pocket. Many local would say good/fantasitc, but I would only say OK seen with european eyes.

Find the tax groups and look into how to get you down one or more groups.

I would today probably do differently than I am doing or something like:
Let the company pay for your appartment, utilities, telefone, adsl etc. you will be taxed, but as fare as I understand less than if you get it as income. Make it such that you salary is lowered with a fixed monthly amount. Any additional you then pay yourself.

Car is nice to have, but if your company is willing to give you min. S$ 2500 a month instead of leasing a car then take the cash and use taxi. The month I used most in taxi was $900, but I was in a cap all the time. Have car now and it is better, but sometimes miss my free taxies.

Negotiate a couple of return tickets it is really nice to go home wihtout having to pay the S$ 2000 (+/-) / person @ economy.

Schooling - hope this is on top of the salary - but else I guess let him pay. However, if you kid(s) are finishing school then take it as salary and suffer for the 1 or 2 years as you probably will find it hard getting back into your salary later.

Remember the healt insurrance S$ 6000 / year/ person if you go for a good international one. Perhaps there is some group discount.

If you had told more about your family arrangements it would had been eassier to comment. I will give you some ideas about prices as I see it with EU eyes:

Good appartments all utilities incl. S$ 3000+ /month Size - OK for a family
Eat as local monday to friday S$ 15 / person / day
Going out western S$ 100 / dinner / person
Avarage taxi cost S$ 8 / trip
Prices in supermarkets very high compared to Europe = eat out
Part time maid S$ 15 / hour
Full time maid S$ 750 / month + accommodation + food (S$350 of the cost goes to the government). She has Sunday off.

Currency issue: I guess S$ is low for the time being so we should expect to gain towards the EURO in the years to come.

Don't forget your pension funds - keep the payments back home running.

Remember a bonus arrangment this is more common out here than in Europe.

Hope it helps a little.

[cyber_m0nkey]

Benefits are taxed differently then cash. Benefits are also taxed differently depending on whether you get an allowance or the benefit is provided to you by the company.

e.g. housing allowance, if this is paid as cash then you are liable for tax on the whole amount. If the lease is in your company's name then only 20% of the value is taxable. Or something like that anyway....

Europe is correct in that taking the car allowance and catching cabs is a good option as cabs are very cheap in Spore, BUT, this depends on your situation, particularily if you have a family. It's not much fun trying to get a cab in peak hour in the rain. Another option I've heard of which sounds like a good middle ground are on call limo's - there are some good rates around and a little more convenience, especially if yuo have a regular schedule, e.g. home-work-home.

It also depends a little on the gareement between Singapore and the country you're coming from.

Best advice I can give is to get your company to pay for professional tax advice for you and structure your package accordingly. Both from your home country and from within Singapore. Even if this advice comes from the same firm, you may get differeing advice due to better local tax knowledge.

Be careful with asking for tax equalization, this is a minefield. Because tax is so much lower in Spore compared to many EU countries, many EU companies are using this as an excuse to lower the base pay so that the after tax income is the same as you would get at home.