Gerard Ong
Tax consultant at Ernst & Young
38 upvotes received
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Tax consultant at Ernst & Young
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  • Asked by Daniel Lee

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered 4w ago
    14 Christmas trees that have a yellow star 🌟 on top
  • Asked by Daniel Lee

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered 4w ago
    Me enduring fire as a senior throughout the 2018 tax peak season -_-
  • Asked by Daniel Lee

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 19 Dec 2018
    My personal finance resolution for 2019 would be to complete the shift of a majority of my portfolio into a more defensive, stable allocation, in anticipation of an expected market downturn.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 29 Oct 2018
    If your parents have met the FRS, then there's no tax relief when you top-up their CPF RA. In that case, the only purpose would be for earning the interest rates from cpf. However, do note that the monies topped up will only be disbursed to your parents gradually via monthly payouts from 65 onwards; it won't be available as a lump sum withdrawal.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 21 Oct 2018
    Yes you should, my parents did the same thing for me.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 16 Oct 2018
    Apart from cashback and/ or miles, another benefit is that you only have to pay for your purchases about 1+ month after the actual expenditure. This means that the money that would have been spent gets to sit in your bank account for that one extra month. And earn interest! For free! Credit cards usually have their first 1-2 years of annual fees automatically waived. After which, you can call in for case-by-case waiver. As long as you can pay your credit card bills on time, there are no costs to using one, but plenty of benefits.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 09 Oct 2018
    Capitaland Limited builds and sells the malls. The trust buys the malls and rents it out for rental income. The rent goes to unit holders of the trust, which may include Capitaland Limited. The managing agent that manages the malls is a separate private company, which is a wholly-owned subsidiary of Capitaland.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 01 Oct 2018
    Yes, you can do that. But a few things to take note of: 1. The tax relief for top-up to parents' CPF is limited to 7k. So if you contribute 10k, you only get a 7k reduction of taxable income. 2. Assuming your parents are above 55 years old (since you said they can withdraw anytime), you will only get tax relief if their RA balance is below FRS. If their RA balance is higher than FRS, you don't get tax relief. (source: https://www.iras.gov.sg/IRASHome/Individuals/Locals/Working-Out-Your-Taxes/Deductions-for-Individuals/CPF-Cash-Top-up-Relief/#title4) 3. When you topup cash to your parents' RA, the amount topped up can thereafter only be withdrawn slowly via monthly payouts, it cannot be withdrawn in one-shot immediately after you top-up. Quote from CPF webisite: "Top-up monies, CPF LIFE Bonus and Deferment Bonus are specifically meant to increase members’ monthly payouts under the Retirement Sum Scheme/CPF LIFE. Hence, they should only be streamed out in the form of monthly payouts." Graphical illustration from CPF: https://www.cpf.gov.sg/Assets/members/Documents/IllustrationoftopupmoniesinRA.pdf Numerical analysis done by Heartland Boy: https://heartlandboy.com/money-withdraw-from-your-cpf-at-55/
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 29 Sep 2018
    Just FYI, if you donate the 100k in one lump sum, you won't necessarily "lose out" on the excess tax relief. Unutilised donations can be carried forward to offset future income, up to a maximum of 5 years. But having said that, it's probably still better to spread out the donations than to do it in one shot, because you won't get your usual personal reliefs if the lump sum donation is sufficient to fully offset your annual income.
  • Asked by Anonymous

    Gerard Ong
    Gerard Ong, Tax consultant at Ernst & Young
    11 Answers, 38 Upvotes
    Answered on 21 Sep 2018
    Firstly, congrats on taking the courage to start up a business overseas. It is said that one of the few ways to accumulate substantial wealth is to start your own business, so here's wishing you all the best. On to your question - although your queries seem straightforward on the surface, there are actually many considerations that have to be examined, so I shall break my answer up into different sections, for clarity and for ease of reading. Structure of your business Are you going to run your business as a sole proprietorship or will you be incorporating a corporate entity (i.e. a company)? There are slight differences between these two. But since you say this is a start-up, and the answers to your questions generally won't differ materially between these two options, I shall assume for the rest of this response that you will be running a sole proprietorship. Distinguihsing between source and residency While most people would assume that profits derived from a business outside Singapore is not taxable in Singapore, this is not always the case in all instances. The key consideration here would be the location of your tax residency. For instance, if you decide to open a business in eg. Malaysia, but you merely send a manager to man the shop there, while you physically remain in Singapore to call the shots, make strategic decisions, exercise management and control in Singapore, then you are actually running a Singapore business. In this case, all profits are considered accruing in Singapore and subject to Singapore tax. Malaysia will also tax your business because it is sourced in Malaysia. You will be effectively taxed twice, then you will have to rely on the Double Taxation Agreement (if there is one with the foreign country) to claim a tax refund via foreign tax credits, subject to conditions. However, if you are indeed permanently moving over to the foreign country to run the business full-time over there, then you will be a tax resident of said country. This is a simpler scenario. Your business profits will only be taxed in the foreign country, and Singapore has no rights to tax your business. Again, since this is a start-up, I will assume this is your preferred method. Business taxes Your income from the business (net of deductible expenses) will be taxed in the foreign country at that country's individual tax rate. If you are running a permanent business there, you will likely need to register your business with either their accounting regulatory body or the tax authorities, and you will be issued a tax reference number. Thereafter, you will need to file a tax return annually in that country and pay your taxes due. Individual taxes If you pay yourself a salary through an employment contract with the business, you will also have to pay tax on your salary at the individual tax rate. Similarly, you will need to file an individual tax return with the relevant tax authorities. CPF CPF contributions are not mandatory if you exercise employment outside of Singapore. You may make voluntary contributions to your CPF if you wish. Do note that the foreign country may also operate their own equivalent social security plan. If you are a tax resident of that country, you may be required to contribute to the national pension fund / unemployment insurance / social security program. Please consult a local tax advisor in that country to find out more details. As a self-employed person, you are required to make mandatory contributions to your CPF Medisave Account (MA). A self-employed person is defined as any Singapore citizen or Singapore Permanent Resident (SPR) who derives income from Singapore or from outside Singapore through any trade, business, profession or vocation. If you have a net trade of income of at least $6,000 annually, you must make contributions to your MA. The contribution rate varies from 4% to 10.5%, depending on your age and income level. For more details, refer to this table. You will need to pay your MA contributions by 31 May of the following year. You can declare your income and make the necessary payment at any CPF Service Centre, SingPost branches, or online via SingPass. GST Depending on the foreign country requirements, if you meet the GST registration criteria, you may be required to collect and pay GST / sales tax to the foreign tax authorities. Future business plans You mentioned that you may expand your business back to Singapore in future. This will likely complicate tax matters, as both countries will seek to tax all your business profits. If you choose not to incorporate separate entities to house each business of the two countries, it will be challenging to convince the tax authorities to assess tax payable only on the income that is attributatble to the enterprise in that country. As mentioned at the start, tax residency is a key consideration. If you move back to Singapore in future to oversee and manage your business, your business will be Singapore-sourced. You will then have to file tax returns in both countries, and claim foreign tax credits. Additionally, since your business will no longer be a tax resident of the foreign country, your customers in that country will start withholding tax when making payments to you (sometimes incorrectly, as certain service income may not be taxed in that country). However, this is a problem for another day, so I shall not go into details at this juncture. Disclaimer In providing my comments in this communication, I have relied upon my understanding of current tax legislation, guidelines and known practices of the relevant tax and other relevant authorities as of this date. Should these legislation, guidelines or known practices change, some of the issues/conclusions discussed in this communication may change as well. The information and views set out in the above response are those of the author, and do not necessarily represent nor reflect the official opinions or advice by his employer. As always, please do your own due dilligence and consult your own tax advisors before making any business decisions.
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