IRAS Publishes Summary of Income Tax Treatment of COVID-19-Related Payouts to Businesses and Individuals

27/07/2020
IRAS Publishes Summary of Income Tax Treatment of COVID-19-Related Payouts to Businesses and Individuals

The Inland Revenue Authority of Singapore (IRAS) has published a summary of the income tax treatment of COVID-19 payouts to businesses and individuals, outlining what is taxable and not, as follows:


The following payouts are not taxable either because they are not income in nature or a specific exemption has been granted to exempt the payout from tax:

 

No.

Payout

Purpose of Payout

Tax Treatment of Payout

1

Self-Employed Person Income Relief Scheme payout

To help eligible self-employed persons (SEPs) tide over this period of economic uncertainty.

Not taxable as the payout is meant to support individuals through the exceptional circumstances arising from the COVID-19 pandemic.

2

COVID-19 Support Grant

To support individuals who have lost their jobs as a result of the COVID-19 pandemic, while they find a new job or attend training.

3

Workfare Special Payment (Under Care and Support package)

To provide support to Singaporeans during this period of economic uncertainty.

4

Temporary Relief Fund payout

To support those who require immediate help to cope with basic living expenses as a result of the COVID-19 pandemic.

5

NTUC Care Fund (COVID-19) payout

To provide one-off financial assistance to National Trades Union Congress (NTUC) union members who are in financial difficulty or retrenched due to the COVID-19 pandemic.

6

Wage support for tourist guides licensed by the Singapore Tourism Board


To provide wage support for licensed tourist guides.

7

Payout to Singaporean seafarers funded by the Maritime and Port Authority of Singapore under the Seafarers Relief Package

To assist Singaporean seafarers who are unable to secure shipboard employment.

8

Jobs Support Scheme payout

To help enterprises retain local employees (Singapore Citizens and Permanent Residents) during this period of economic uncertainty.

Not taxable as the payout is to help employers retain their local employees by providing cashflow support or mitigate the financial impact of COVID-19 containment measures for employers and SEPs.

9

COVID-19 Quarantine Order Allowance scheme payout


COVID-19 Leave-of-Absence (LOA) scheme payout

COVID-19 Stay-Home Notice (SHN) scheme payout

To mitigate the financial impact for those who have been served, or whose workers have been served, a Quarantine Order, LOA or SHN.

 

10

Courage Fund COVID-19 Relief schemes

For more information on the schemes available, please refer to the National Council of Social Service.

To provide relief and support to low-income families, healthcare workers and other specified individuals who have supported the national response to COVID-19 and in doing so, contracted COVID-19.

Not taxable as these are unconditional gifts.



The following payouts are taxable, being revenue receipts of a business, in accordance with general income tax rules:

No.

Payout

Purpose of Payout

Tax Treatment of Payout

1

Temporary Housing Support for employers affected by Malaysia's Movement Control Order

To help employers defray the additional costs of providing short-term housing to affected workers.

Taxable as the payout received is to defray the operating costs of a business and is revenue in nature.

2

Senior Worker Support Package

  • Senior Employment Credit
  • CPF Transition Offset Scheme
  • Senior Worker Early Adopter Grant
  • Part Time Re-employment Grant

 

To support employment of senior workers.

3

Assistance scheme to defray third-party professional cleaning and disinfection costs for premises with confirmed COVID-19 cases

To provide assistance to defray cleaning costs for premises with confirmed COVID-19 cases.

4

Special relief for unhired taxis

To help taxi operators defray the costs of their unhired fleet of taxis.

5

Wage Credit Scheme
(Including the enhancements made as part of the Stabilisation and Support Package in Budget 2020)

To support wage increases for Singaporeans.


Source: IRAS