Earned Income Relief

Earned Income Relief is income relief for individuals who are gainfully employed or carrying on a trade, business, profession or vocation.

How do you qualify for Earned Income Relief?

You will receive this relief if you have taxable income from any of the following sources in the previous year;

Employment
Pension
Trade, business, profession or vocation

Earned Income

Earned income is the taxable earned income from employment, pension, trade, business, profession or vocation less allowable expenses.

Amount of Earned Income Relief

The amount of income relief is based on your age and taxable earned income in the previous year.

The table shows the maximum amount claimable.

Amount of Earned Income Relief
Your age as of 31 Dec the previous year	Year of Assessment (YA) 2012 and before	Year of Assessment (YA) 2013 onwards
Below 55	$1,000	$1,000
55 to 59	$3,000	$6,000
60 and above	$4,000	$8,000

If the amount of taxable earned income is lower than the maximum amount claimable, the relief will be capped by the amount of taxable earned income.

Example as follows;

“55 Years Old as of 31 Dec 2015”

If you are 55 years old and earned income in 2015, you will get Earned Income Relief of $6,000 or the amount of earned income, whichever is less, for the Year of Assessment 2016?

Earned Income Relief for Handicapped Persons

Earned Income Relief will be higher for those with permanent physical or mental disability that severely affects their ability to work.

The table shows the maximum amount claimable.

Maximum amount claimable
Your age as of 31 Dec the previous year	Year of Assessment 2012 and before	Year of Assessment 2013 onwards
Below 55	$2,000	$4,000
55 to 59	$5,000	$10,000
60 and above	$6,000	$12,000

If the amount of taxable earned income is lower than the maximum amount claimable, the relief will be restricted to the amount of taxable earned income.

Claiming Earned Income Relief

The good news is you do not need to claim Earned Income Relief. If you are eligible, the IRAS will automatically grant this relief to you when your tax return is processed.

First-Time Claim for Handicapped Earned Income Relief

Those claiming Handicapped Earned Income Relief for the first time must complete and submit a Handicapped related tax relief form by email, fax or post to the IRAS.

The IRAS will automatically grant you Handicapped Earned Income Relief in subsequent years if you are eligible. You do not need to enter your claim in your tax return in subsequent years.