The Inland Revenue Authority of Singapore in late 2018 announced a new formula for calculating taxable benefits of employer-provided automobiles. The new method is effective from the year of assessment 2020.
Under the current formula, the distance traveled for private purposes (that is, personal use of the car) may involve some degree of estimation by the employee. The new formula requires no estimation because actual operating and maintenance expenses incurred by the employer are used. Nevertheless, the tracking of personal mileage is still required in situations when the employer also provides a driver along with the car.
The new formula is expected to better reflect the prevailing costs of car ownership and maintenance. Employers will need to take note of this change to determine that the correct taxable car benefits are reported in their employees’ Form IR84, Return of Employee’s Remuneration.
Read a February 2019 report [PDF 474 KB] prepared by the KPMG member firm in Singapore
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