Parent Tax Rebate is a joke - and so is IRAS!

[offshoreoildude]

I have two SC kids. I have been applying for the parenthood tax rebate. My first son is subject to a custody order and my second child is an adopted SC. I personally don't see anything in the rules that stops me from claiming PTA. However I'm clearly tweaking the IRAS lions tail - we're up to six letters now - all pretty much demanding the same documentation over and over again. They really don't get it - PTA is meant to encourage people to have kids (SC as mine are) but the way they apply it, I can see why Singaporeans treat it as a joke.

[Splatted]

I have two SC kids. I have been applying for the parenthood tax rebate. My first son is subject to a custody order and my second child is an adopted SC. I personally don't see anything in the rules that stops me from claiming PTA. However I'm clearly tweaking the IRAS lions tail - we're up to six letters now - all pretty much demanding the same documentation over and over again. They really don't get it - PTA is meant to encourage people to have kids (SC as mine are) but the way they apply it, I can see why Singaporeans treat it as a joke.

I'm studying tax as a hobby at night school, and apparently (if I remember back correctly) one of the conditions of the rebate is that the child must belong to a married couple (male + female) . (I take it you aren't remarried yet?)

Therefore single parent families, or even mums with illegitimate children, or children belonging to gay couples, need not bother applying.

I guess it falls in line with Sg's idea of the perfect family unit it wants to promote.

edit: which rebate/relief were you actually trying to claim? there are 3 at the moment. Qualifying Child Relief (QCR), Handicapped Child Relief (HCR), or Working Mother's Child Relief (WMCR)?

Is the person you are having custody battle also claiming same reliefs/rebates for same child?

edit #2: sorry, reread your post. rebate is only for married couples, whose child is:

a) a legitimately born on or after 1 jan 08, and becomes a SC at the time of birth or within 12 months thereafter.

b) an illegitimate child born on or after 1 jan 08, and whose birth occurs before the marriage of the natural parents, and they become lawfully married before he/she turns 6 years old; and the child becomes a Singapore citizen at the time of marriage of his natural parents or within 12 months thereafter.

c) a child legally adopton on or after 1 jan 08 but before he reaches 6 years old and becomes a SC at the time of legal adoption, or within 12 months thereafter.

[offshoreoildude]

I have two SC kids. I have been applying for the parenthood tax rebate. My first son is subject to a custody order and my second child is an adopted SC. I personally don't see anything in the rules that stops me from claiming PTA. However I'm clearly tweaking the IRAS lions tail - we're up to six letters now - all pretty much demanding the same documentation over and over again. They really don't get it - PTA is meant to encourage people to have kids (SC as mine are) but the way they apply it, I can see why Singaporeans treat it as a joke.

I'm studying tax as a hobby at night school, and apparently (if I remember back correctly) one of the conditions of the rebate is that the child must belong to a married couple (male + female) . (I take it you aren't remarried yet?)

I am remarried.


Therefore single parent families, or even mums with illegitimate children, or children belonging to gay couples, need not bother applying.

My children belong to a family with two heterosexual parents who are married to each other

I guess it falls in line with Sg's idea of the perfect family unit it wants to promote.

edit: which rebate/relief were you actually trying to claim? there are 3 at the moment. Qualifying Child Relief (QCR), Handicapped Child Relief (HCR), or Working Mother's Child Relief (WMCR)?

QCR.

Is the person you are having custody battle also claiming same reliefs/rebates for same child?

No, she is not working and therefore has no income apart from the child support I pay here. I _think_ this is what's causing some of the problems.

edit #2: sorry, reread your post. rebate is only for married couples, whose child is:

a) a legitimately born on or after 1 jan 08, and becomes a SC at the time of birth or within 12 months thereafter.

b) an illegitimate child born on or after 1 jan 08, and whose birth occurs before the marriage of the natural parents, and they become lawfully married before he/she turns 6 years old; and the child becomes a Singapore citizen at the time of marriage of his natural parents or within 12 months thereafter.

c) a child legally adopton on or after 1 jan 08 but before he reaches 6 years old and becomes a SC at the time of legal adoption, or within 12 months thereafter.

This applies to my second child, she was born a SC in 2010 and was ours legally in sometime later in 2010. My first was born in 2001 and become a SC within 12 months.

The main issue according to the letter is the order of the children and whether my first child is living with me (no definition provided - he lives most of the time with his mother but all his support is from me in financial terms).

Thanks for your response. It's clear that this _rebate_ has failed to encourage SC to have kids - because it's a rebate and not a subsidy or outright payment it's funnelled to a very small class of people.

[revhappy]

Just read about the Parenthood tax rebate. Wonder why they call it a rebate and why it isnt a part of the tax reliefs. I guess because its a 1 time thing compared to reliefs which can be claimed every year. Also is the rebate a deduction from the taxable income or is it a deduction from the income tax payable? If it is just a deduction from the taxable income, then I agree, it isn't much to actually encourage giving birth to babies. But hey the taxes here a so less anyways, so the income tax rebate is surely not the way to encourage babies.

For the QCR, there is nothing in qualifying criteria that says that the child or the parents need to be SC, nor does it say that the child should be born in Singapore.

I am foreigner on EP and have claimed the QCR for our daughter born in India but we are all in Singapore now.

Best part is she was born in Oct 2011 yet I could claim for the whole year.

[x9200]

You have two type of relief:
- parenthood rebate (for SC children only).
- Qualifying/handicapped child relief (also for PRs).

[Splatted]

Just read about the Parenthood tax rebate. Wonder why they call it a rebate and why it isnt a part of the tax reliefs. I guess because its a 1 time thing compared to reliefs which can be claimed every year.

Because they affect the tax calculation at different points of the assessment.

Relief will affect the amount of assessible income (AI) you have in the year, ie the lower your income appears, the less tax is calculated and owing in end.

Rebate subtracts from that final "tax owing" total, ie you may end up with a tax bill which ordinarily would have been $1000, but because of the rebate it's reduced to nil, and carried forward to following years if there is any balance left. In the end you might end up not paying tax for a few years in a row, depending on your income.

[revhappy]

Just read about the Parenthood tax rebate. Wonder why they call it a rebate and why it isnt a part of the tax reliefs. I guess because its a 1 time thing compared to reliefs which can be claimed every year.

Because they affect the tax calculation at different points of the assessment.

Relief will affect the amount of assessible income (AI) you have in the year, ie the lower your income appears, the less tax is calculated and owing in end.

Rebate subtracts from that final "tax owing" total, ie you may end up with a tax bill which ordinarily would have been $1000, but because of the rebate it's reduced to nil, and carried forward to following years if there is any balance left. In the end you might end up not paying tax for a few years in a row, depending on your income.

Thanks for the clarification. Makes sense now

[Splatted]

This applies to my second child, she was born a SC in 2010 and was ours legally in sometime later in 2010. My first was born in 2001 and become a SC within 12 months.

The main issue according to the letter is the order of the children and whether my first child is living with me (no definition provided - he lives most of the time with his mother but all his support is from me in financial terms).

You dont qualify for the parental rebate for first child because of year of birth.

You should still be able to claim QCR however.

Second child you can still claim parental rebate, I believe.

The "order of children" question is important for determining what amount of rebate to apply. The later the child, the higher the amount:

1st child: $5000
2nd child: $10000
3rd child: $20000
4th child: $20000

your adopted child would be considered 2nd child as the adoption date is after the birth date of the first child.

I'm not sure what the second question is about, as it wasn't within the scope of the course I'm taking. I think the natural assumption or the spirit of the law is that a supported child is living with the parent, and therefore only elegible for rebate and relief if under the same roof.

The second question therefore is probably to ascertain are you even eligible to get QCR for the first child as you originally tried to claim for.

The issue with divorces and custody battles is that if it's not mentioned in the rules, it falls into a gray area. You might find the laws modified as a result of cases like yours (assuming it already hasn't been addressed by the IRAS, but simply not covered in my course).

Other question I would be looking into if I were the IRAS, is your ex-wife remarried? If she is remarried and husband supporting her as well, he may be also try to claim QCR / parental rebate even though you have sent $$ regularly. The whole thing as implications on a number of levels.

Finally, one other area you may want to ask your accountant about is whether your current wife is entitled to claim for working mother's child relief (WMCR), assuming she is working, as well as foreign maid levy relief if you have a foreign maid. Both of these are reliefs related to having children

[offshoreoildude]

Thanks for your reply. It does make sense now I see that the rebates are significantly different depending on order. What's annoys me is that they are clearly trying to claim my first born does not count as he lives with my ex wife - even though I fully support her (she does not work) and hence support the child 100%.

[Splatted]

Thanks for your reply. It does make sense now I see that the rebates are significantly different depending on order. What's annoys me is that they are clearly trying to claim my first born does not count as he lives with my ex wife - even though I fully support her (she does not work) and hence support the child 100%.

The bit that I didn't elaborate on are the rebates are cumulative, ie if both children are under your care and are eligible for parental rebate, its $5000 + $10000

and if you have 3 children , it's $5000 + $10000 + $20000

Now, assuming they decide the first child is NOT in your care, but that you are eligible to claim for second, it's still the 2nd figure that you will be rebated. In other words, 2nd child would receive rebate of $10000 even if first child is no longer with you, had passed away or given up for adoption. The order of sequence, and therefore rebate is maintained.

[offshoreoildude]

Thanks for your reply. It does make sense now I see that the rebates are significantly different depending on order. What's annoys me is that they are clearly trying to claim my first born does not count as he lives with my ex wife - even though I fully support her (she does not work) and hence support the child 100%.

The bit that I didn't elaborate on are the rebates are cumulative, ie if both children are under your care and are eligible for parental rebate, its $5000 + $10000

and if you have 3 children , it's $5000 + $10000 + $20000

Now, assuming they decide the first child is NOT in your care, but that you are eligible to claim for second, it's still the 2nd figure that you will be rebated. In other words, 2nd child would receive rebate of $10000 even if first child is no longer with you, had passed away or given up for adoption. The order of sequence, and therefore rebate is maintained.

Excellent info. I've given up sending more documents. They only ask for the same ones over and over. I've told them I oppose their blatant attempt to deprive me of a rebate for both SC children and left it at that.

[offshoreoildude]

Well they only gave it for one child - the young adopted one. The other one who lives with his mother I got nothing for - even though as she doesn't work she can't claim it and I support the child as per a child support order. I'll appeal this - it goes directly against the idea of PTA to support parents.

[Splatted]

Well they only gave it for one child - the young adopted one. The other one who lives with his mother I got nothing for - even though as she doesn't work she can't claim it and I support the child as per a child support order. I'll appeal this - it goes directly against the idea of PTA to support parents.

But, as I mentioned in a previous post. First child never qualified for the rebate because they were born prior to when the scheme started.

[offshoreoildude]

Well they only gave it for one child - the young adopted one. The other one who lives with his mother I got nothing for - even though as she doesn't work she can't claim it and I support the child as per a child support order. I'll appeal this - it goes directly against the idea of PTA to support parents.

But, as I mentioned in a previous post. First child never qualified for the rebate because they were born prior to when the scheme started.

Yes you're right. I went back and re-read your advice. What I'm appealing is the child order business - they've only allowed a $5000 rebate instead of the $10,000 rebate. I have two children!

[offshoreoildude]

Turns out that Section 42A(13)of the income tax act has a clause that allows only the custodial parent to claim PTA....