3,000 spats a year over who can claim Parent Relief: IRAS

IRAS seeking feedback on how to minimise such family conflicts

By Rachael Boon, The Straits Times, 14 Jun 2013

FAMILY squabbles happen all the time but having differences over who can claim parent relief when filing income tax returns is not one that immediately comes to mind.

The Inland Revenue Authority of Singapore (IRAS) said that last year, there were about 3,000 cases of family members fighting over parent relief claim, similar to that in previous years.

In an interview with The Straits Times, Mrs Sabina Cheong, assistant commissioner of the individual income tax division at IRAS, said yesterday that the agency is seeking public suggestions on the issue.

Mrs Cheong said disputes often occur when two or more family members are taking care of a parent or parents and all of them want to claim tax relief. These family members could be siblings, grandchildren or in-laws.

"It can get very touchy or emotional when we handle duplicate claims," she added.

The parent relief is a tax break that recognises the contributions of single or married taxpayers who look after their parents.

Under current rules, only one family member can claim tax relief on a parent, and that parent has to meet certain criteria before the claim can be approved by IRAS.

For example, the parent must be at least 55 years old in the year prior to when a claim is filed and living in Singapore.

If the parent is not living in the same household as the taxpayer, the amount spent on parent support in the year of assessment must be at least $2,000.

Also, the annual income - including part-time salary and rental income - of the parent must not exceed $4,000.

Mrs Cheong highlighted several scenarios on how a dispute over parent relief can arise.

For instance, a child could be living with a parent but a sibling could be the main provider of financial support for the parent, she said.

The children may also be living apart from a parent but are taking care of the various needs of that parent, she added.

One way to resolve the dispute is to let a parent decide which family member can claim parent relief.

Mrs Cheong cited one such case: "The brother and sister could not agree on who should receive the relief, so the father decided for them."

The parent relief was increased from a maximum of $5,000 to $7,000 in Budget 2010.

If a taxpayer is supporting a handicapped parent, the relief is higher at $11,000, up from $8,000 previously.

Last year, 256,000 taxpayers filed claims for parent relief.

The dispute over parent relief becomes thornier when more family members are involved.

Mrs Cheong said: "Since those who can claim parent relief could be children, grandchildren or in-laws, this issue can potentially be more contentious."

Hence, IRAS wants to hear suggestions from the public on the issue, with the aim of minimising the number of conflicting claims, she said.

The public can give comments via a poll on feedback unit REACH, e-mail at public_consultation@ iras.gov.sg and by post.