How to Read a Tax Return With Deductions
'Notice of Assessment' refers to your revenue enhancement bill. Information technology shows the types and amount of income brought to tax, deductions y'all have claimed, and the amount of tax payable by you lot; or repayable to you.
On this page:
Types of income taxation bills
| Types of taxation bills | Description |
|---|---|
| Notice of Assessment (Original) | This is the tax nib computed based on the tax form(s) that you have submitted and/or information sent by organisations participating in the Automobile-Inclusion Scheme. |
| Notice of Cess (Amended) | If we amend your tax assessment, you will receive a Notice of Amended Assessment. The 'Previous assessment' shows your tax payable from your previous tax bill. If there is any credit in your tax business relationship, we will provide you with a refund of the credit amount. |
| Notice of Cess (Additional) | If we revise your taxation assessment, you lot need to pay the additional taxes. You will receive the Notice of Additional Cess and the additional tax you need to pay is shown as 'Additional Tax Payable'. |
| Detect of Assessment (Repayment) | If in that location is whatever credit amount to be refunded to you, you volition receive a Notice of Repayment instead of a Notice of Assessment. |
| Notice of Assessment (Estimated) | If you have not filed your Income Tax Return by the due date, we may estimate your tax based on information bachelor and send you an Estimated Notice of Assessment. The estimated tax is shown as 'Estimated Taxation Payable'. |
Tax terms on tax bills
| Tax terms | Explanation | Example |
|---|---|---|
| Year of Assessment | This refers to the tax twelvemonth in which your income revenue enhancement is calculated and charged. The assessment is for income you have earned in the preceding calendar twelvemonth. | Year of Assessment 2022 is for income earned from one January 2021 to 31 Dec 2021. |
| Income | The amount reflected under 'Income' is your total income afterward deducting commanded expenses. The total income includes:
|
|
| Deductions | Deductions similar donations and reliefs can help lower your income subject to tax. | |
| Chargeable income | This refers to your 'Income', later subtracting 'Deductions'. | |
| Tax payable | This refers to the amount of taxation that you need to pay. | 'Tax payable by 27 May 2022 $8,586.00' means y'all must pay $eight,586.00 to IRAS by 27 May 2022, unless you lot are paying your taxes via GIRO. |
| Revenue enhancement repayable/discharged | This refers to the corporeality of tax that will be refunded to you. | 'Tax repayable/discharged $300' ways $300 volition be refunded to y'all. |
General income tax glossary
| Tax terms | Explanation | Example |
|---|---|---|
| Basis period | This refers to the menses of income relevant to the Year of Assessment (YA). The basis period for a YA is the twelvemonth preceding that YA. The basis period for YA 2022 is 1 Jan 2021 to 31 December 2021. If you receive business income, the basis period may exist unlike if your accounts are made up to a date other than 31 December. | Example ane: Employment income Mr Tan has employment income from 1 Jan 2021 to 31 Dec 2021. This income is earned in the basis catamenia from one January to 31 Dec 2021 and hence, it will be assessed in the Year of Cess 2022. Instance ii: Concern income Mr Lee is a sole-proprietor. His business concern financial year ends on 31 Mar 2021. His business income is earned in the ground catamenia from 1 Apr 2020 to 31 Mar 2021 and hence, it will be assessed in the Year of Cess 2022. |
| Assessable income | This is your total income after deducting commanded expenses and canonical donations. Total income includes:
Note: Chargeable income is the remainder of your assessable income later deducting personal reliefs. | Mr Lim has: Employment income = $50,000 Commanded expenses and donations = $5,000 Assessable income = $50,000 - $v,000 = $45,000 Personal reliefs = $x,000 Chargeable income = $45,000 - $ten,000 = $35,000 |
| Personal reliefs | There are deductions which can assist you save tax. These are allowable if:
|
Source: https://www.iras.gov.sg/taxes/individual-income-tax/basics-of-individual-income-tax/receive-tax-bill-pay-tax-check-refunds/understanding-my-tax-assessment
0 Response to "How to Read a Tax Return With Deductions"
Post a Comment