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Expat Package Proposal for US Exec

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Brah
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Re: Expat Package Proposal for US Exec

Postby Brah » Mon, 18 Apr 2016 5:24 pm

Interesting to read this thread while viewtopic.php?p=746409#p746409 is active in parallel.
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Re: Expat Package Proposal for US Exec

Postby Strong Eagle » Tue, 19 Apr 2016 12:45 am

JR8 wrote:I wonder if the employer would be willing to pay out the annual rent allowance to you as a lump sum, and then you go off and arrange what ever kind of rental you like ($ of your choosing). That was Standard Operating Procedure at my last employer.


It would be more tax advantageous for the company to provide housing to the employee as the amount of taxable income will be less than the actual value of the rent the company pays. A housing allowance is simply taxed as income.

https://www.iras.gov.sg/IRASHome/Busine ... -Benefits/

My company held the lease on the house I rented.

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Re: Expat Package Proposal for US Exec

Postby BBCWatcher » Tue, 19 Apr 2016 11:46 am

Strong Eagle wrote:It would be more tax advantageous for the company to provide housing to the employee as the amount of taxable income will be less than the actual value of the rent the company pays.

The information you linked to states the opposite, doesn't it? Tax regulations changed fairly recently, starting in the beginning of calendar year 2014/Year of Assessment 2015. You may be thinking of the past when an employer's direct payment of housing costs had some beneficial tax consequences in Singapore.

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Re: Expat Package Proposal for US Exec

Postby Strong Eagle » Tue, 19 Apr 2016 12:17 pm

BBCWatcher wrote:
Strong Eagle wrote:It would be more tax advantageous for the company to provide housing to the employee as the amount of taxable income will be less than the actual value of the rent the company pays.

The information you linked to states the opposite, doesn't it? Tax regulations changed fairly recently, starting in the beginning of calendar year 2014/Year of Assessment 2015. You may be thinking of the past when an employer's direct payment of housing costs had some beneficial tax consequences in Singapore.


Right you are. They have closed that loophole. I don't know where the "annual value" would come from these days, and only if the "annual value" were less than the rent paid by the employer, would the employee catch a break.

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Re: Expat Package Proposal for US Exec

Postby ivysmom » Tue, 19 Apr 2016 1:19 pm

Interesting, I have to say the lawyer in me appreciates this level of detail. I have to admit I've been more focused on US tax consequences, as it seems like it's the US tax that really kills you (or the US employer)!

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Re: Expat Package Proposal for US Exec

Postby Strong Eagle » Tue, 19 Apr 2016 9:21 pm

Strong Eagle wrote:
BBCWatcher wrote:
Strong Eagle wrote:It would be more tax advantageous for the company to provide housing to the employee as the amount of taxable income will be less than the actual value of the rent the company pays.

The information you linked to states the opposite, doesn't it? Tax regulations changed fairly recently, starting in the beginning of calendar year 2014/Year of Assessment 2015. You may be thinking of the past when an employer's direct payment of housing costs had some beneficial tax consequences in Singapore.


Right you are. They have closed that loophole. I don't know where the "annual value" would come from these days, and only if the "annual value" were less than the rent paid by the employer, would the employee catch a break.


I must say that this "annual value" concept seems to be a bizarre way to assess property taxes. While not explicitly stated on the IRAS pages, it seems that AV is equal to prevailing rents in the area, less the assumed rent for "furnishings". For personal income tax purposes those furnishings are factored back in again. Thus, it might be worth checking the tax rolls for a property's annual value, then determine whether rent or AV is more tax advantageous.

https://www.iras.gov.sg/IRASHome/upload ... erties.pdf

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Re: Expat Package Proposal for US Exec

Postby BBCWatcher » Wed, 20 Apr 2016 12:45 pm

I don't think you get to choose. My understanding is that the AV calculation kicks in when the employer owns the property -- CapitaLand housing a foreign executive in an Ascott Serviced Apartment, for example. (CapitaLand owns Ascott.) Otherwise it's rent, although IRAS inserts the word "market" in front just to be sure somebody isn't playing games -- "special deal" from the CEO's brother as landlord and that sort of thing.


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