Common Reporting Errors

 

Form IR8A

Common Reporting  Errors to AvoidPoints to Note

Entering cents for the fields under:

Income (items a to e)

Deduction (Employee's compulsory contribution to CPF, Donations, Contributions for Mosque Building Fund and Life Insurance premiums)

We give the benefit to taxpayers when rounding up or down to the nearest dollar.

For income fields, drop the cents. For the items d1 to d9, drop the cents only after obtaining the total for items d1 to d9.

For deduction fields, round up to the next dollar.

E.g. 1
Salary of $31,220.98 is to be entered as $31,220 (drop the cents).

E.g. 2
Deduction such as CPF contributions of $5,566.22 is to be entered as $5,567 (round up).

Including non-taxable components of lump sum payments under item d4.

Declare only the taxable components under item d4 for the gratuity, notice pay, ex-gratia payment and other payments.

The non-taxable components are to be declared under "Compensation for loss of office".

For more information on taxable lump sum payments, please refer to our webpage on  Retrenchment and retirement benefits .

Deducting the amount of payment in-lieu of notice paid by employee for insufficient resignation notice.

Payment by the employee is not tax deductible. Thus, this amount should not be deducted from the employee's total employment income.

Reporting overseas employment income and employee's CPF contribution for employees who are posted overseas.

For employees’ overseas posting not incidental to Singapore employment in the Form IR8A, please note that it is not compulsory for employers to state the amount of overseas employment income. Employers participating in AIS are only required to select “Income from Overseas Employment” under Exempt/Remission Income Indicator.

However, you are still required to report the amount of donations, contributions to Mosque Building Fund and Life Insurance Premiums deducted through the employee's salary.

Including the employer's CPF contribution with employee's compulsory contribution to CPF.

Only employee's compulsory contribution to CPF should be reported in the deductions section of the Form IR8A. 

Employer's compulsory CPF contribution should be excluded.

Including excess/voluntary contribution to CPF, which has been refunded or to be refunded to employer, as taxable income under item d7.

If you have claimed or have the intention to claim a refund for the excess/voluntary employer's CPF contribution from CPF Board, please ensure that you:

1) Do not report the excess employer's CPF contribution as taxable income under item d7; and

2) Complete Section C of the Form IR8S to provide details of the refund claimed or to be claimed on excess CPF contributions made.

Form IR8S

Common Reporting  Errors to AvoidPoints to Note

Section A
Incorrectly reporting capped wages/CPF contributions  instead of actual Ordinary Wages (OW), Additional Wages (AW) and CPF contributions made by both the employer and employee

Report the  actual  monthly wages (ordinary and additional) paid to the employee.

Report the  actual  monthly CPF contributions made by both the employer and employee.

Section B
Not reporting the amount of excess/voluntary CPF contribution

Complete Section B only if there is excess CPF contribution.

i.e. Actual CPF contributions minus Allowable/Capped CPF contributions

Appendix 8B

Common Reporting  Errors to AvoidPoints to Note

Not declaring free shares granted/awarded to employees from parent or local company.

Free shares granted or awarded to employees are a taxable benefit, which arises from their employment in Singapore. 

You are required to report this employment benefit in the Appendix 8B.

Not converting the value of shares or stock options granted/awarded to employees in foreign currency into Singapore currency.

You must convert the value of the shares or stock options in foreign currency into Singapore currency when completing Appendix 8B. Use the actual exchange rate as at the date when the employee exercised the stock option or the actual exchange rate as at the date of grant or the date the moratorium is lifted.

For more information, please refer to item 6 of the  Explanatory notes on Appendix 8B .

Incorrectly reporting gains from Employee Stock Option (ESOP) / Employee Share Ownership (ESOW) with selling restriction (moratorium) imposed.

Payment by the employee is not tax deductible. Thus, this amount should not be deducted from the employee's total employment income.

The gains accrue on the date when the selling restriction (moratorium) is lifted and not on the date of exercise or grant. 

For example, shares are awarded to employee in the year 2012 with a moratorium imposed until 2014.  The gains should be reported in the Form IR8A and Appendix 8B for the Year of Assessment 2015.

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