Rental Advise

Discuss about where to live, renting a property, tenancy issues, property trend and property investment in Singapore.
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farmer33
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Rental Advise

Post by farmer33 » Tue, 16 Oct 2012 4:52 pm

I may be in the wrong place for this question but I would like some info on renting a condo,do you need to have your work to rent for you or can you just rent a condo on a work permit ? I have been told you can not rent in your own right on a work permit oe what ever it is classed as. Thanks in advance. :D

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Post by nakatago » Tue, 16 Oct 2012 5:08 pm

Work permit as in work permit or any of the employment pass tiers?
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farmer33
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Post by farmer33 » Tue, 16 Oct 2012 5:47 pm

Nakatago,I have no idea that is why I need the help,I presume I will be legal with the company I will work for what ever "permit" one needs for that. But my boss says instead of paying me a housing allowance they will rent the condo for me as I can not. I have a us$35,000 housing allowance and wondering if i,m getting clipped of some of it ? I may do better with the cash than letting them rent a condo for me,that is why i ask the question. Thanks for the response so soon, Cheers Farmer33 :D

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Strong Eagle
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Post by Strong Eagle » Tue, 16 Oct 2012 6:09 pm

If you have a valid work permit, then you can rent. However, there are personal income tax benefits to you if your company rents the condo for you. For example, if you are paid $35,000 in rental allowance, that is taxable at normal personal income tax rates.

However, if you company rents a place that costs them $35,000, and we assume you make $50,000, then your income tax would be calculated as: (1) The lower of: 10% of annual employment income, OR the annual value of the premises; (2) Less rent paid by employee (if any).

In this example, you would pay tax the lesser of the rent or 10 percent of your salary, or $5000, a significant saving.

So long as the condo they are renting for you has an equivalent market value of what you would rent, you're not getting clipped, you are saving money.

It's a wash for the company, however... it's all expense whether salaries or housing rentals.

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Post by Strong Eagle » Tue, 16 Oct 2012 6:10 pm

PS: If you can't rent, then you don't have a legal work permit. How long will you be here?

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Post by farmer33 » Wed, 17 Oct 2012 9:50 am

Thank you,That is very sound advise re tax etc and I hope to be there 3 years max. Do you recomend short term accomadation (although expensive) in the first month or two to find the right place to rent? and also do you think I can get a nice condo in the east coast area near the beach or at least close by?

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Post by Strong Eagle » Wed, 17 Oct 2012 10:29 am

farmer33 wrote:Thank you,That is very sound advise re tax etc and I hope to be there 3 years max. Do you recomend short term accomadation (although expensive) in the first month or two to find the right place to rent? and also do you think I can get a nice condo in the east coast area near the beach or at least close by?
I definitely recommend a Short Term Stay in order to search for properties. First, you want to look at location "in the flesh". You can live almost anywhere in Singapore, and the location makes a difference in rent cost, ambiance, and proximity of amenities like shopping centers, public transportation, and food and beverage.

Second, people differ in what they like in terms of the property. Older properties tend to be larger but without the granite and bells and whistles of newer places. You cannot really know without looking.

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Taxable Income Calculation

Post by ComingSoon » Wed, 17 Oct 2012 3:41 pm

Strong Eagle wrote: However, if you company rents a place that costs them $35,000, and we assume you make $50,000, then your income tax would be calculated as: (1) The lower of: 10% of annual employment income, OR the annual value of the premises; (2) Less rent paid by employee (if any).

In this example, you would pay tax the lesser of the rent or 10 percent of your salary, or $5000, a significant saving.
Hi SE,

So, using the example above, the OP's total annual taxable income would be $55K instead of $85K. Correct?

Thanks!

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Re: Taxable Income Calculation

Post by Strong Eagle » Wed, 17 Oct 2012 5:07 pm

ComingSoon wrote:
Strong Eagle wrote: However, if you company rents a place that costs them $35,000, and we assume you make $50,000, then your income tax would be calculated as: (1) The lower of: 10% of annual employment income, OR the annual value of the premises; (2) Less rent paid by employee (if any).

In this example, you would pay tax the lesser of the rent or 10 percent of your salary, or $5000, a significant saving.
Hi SE,

So, using the example above, the OP's total annual taxable income would be $55K instead of $85K. Correct?

Thanks!
Yes - see this IRAS page for details.

http://www.iras.gov.sg/irasHome/page04. ... 8#employee

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Post by JR8 » Wed, 17 Oct 2012 7:34 pm

farmer33 wrote:Thank you,That is very sound advise re tax etc and I hope to be there 3 years max. Do you recomend short term accomadation (although expensive) in the first month or two to find the right place to rent? and also do you think I can get a nice condo in the east coast area near the beach or at least close by?
Getting the employer to put you in a Serviced Apartment for up to a month on your arrival would be a good idea.

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Re: Rental

Post by Kevin TY » Tue, 06 Nov 2012 11:03 am

It's probably best to camp in a nice Service Apartment for at least half a month and to see the apartments.

35,000 USD a year is actually less than required if your company is putting you up in any of the Prime districts, Tanglin, Orchard, Newton, Bukit Timah, or anywhere in town. Those will cost you upwards of 65,000 USD (give or take) per year.
So as mentioned you might even be saving money haha

35,000 USD a year will get you either a 2-bedroom condo in the outskirts or a really nice single room (but just a room!) in the town-ish area.
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