Q1. When should I file tax?
IRAS. Please note that filing starts from 1 Mar 2016. You are required to submit the completed paper Form B by 15 Apr 2016. For e-filing, the filing due date is 18 Apr 2016.
Q2. I am driving part-time, do I file my Grab income with my employment income tax?
IRAS: A part-time GrabCar driver is considered as a self-employed person. You can declare your income from GrabCar driving as trade income under “Trade, Business, Profession or Vocation” of your personal Income Tax Return. This is separate from your employment income which you would declare under “Employment” source in the tax return.
Q3. As a sole proprietor, where should I go to file taxes?
IRAS: As a sole-proprietor, you should report your business income in your income tax return under ‘Sole Proprietorship’ in the ‘Trade, Business, Profession or Vocation’ section.
Q4. Is there a standard format required by IRAS for submission of my business accounting?
IRAS: You have to report the 4-line statement of your business as follows:
1. Revenue (Total fees received)
2. Gross Profit/Loss (For service business, the gross profit is equal to your revenue)
3. Allowable Business Expenses
4. Adjusted Profit/Loss
For Revenue of $100,000 or less, you have to report only 2-line statement ie REVENUE and ADJUSTED PROFIT/LOSS
For revenue of $500,000 or more, you are required to submit certified Statement of Accounts. A complete set of certified Statement of Accounts comprises the certified Profit & Loss Account and Balance Sheet.
Q5. Do I need to declare:
- my cash incentives?
- free credits (e.g. incentives, sign up credit, promotional credit)?
- GrabPay earnings that have not been cashed out?
- Referral incentives?
IRAS: Based on the understanding that the incentives and free credits provided by GrabCar are meant to incentivize the drivers when they meet certain targets, these incentives and credits constitute additional income of the Grabcar drivers. In this regard, the drivers have to include this additional income as part of their revenue for the year when the incentives and credits are provided to them even if they have not been “cashed out”.
Q6. Which of the following can I claim for tax deductions purposes?
a. (i) GrabCar levy
(ii) Admin charges by Grab car for reprint of statement and topping up of “e-wallet”
IRAS: We are given the understanding that the Grabcar levy is a portion of the passengers’ fares that Grabcar is entitled to. In this respect, the drivers may claim the levy that has been charged by Grabcar and the Admin charges imposed by Grabcar as part of their business operating expenses. Please advise the Grabcar drivers to declare the gross revenue amount (i.e. 100% of the fares) and claim the levy and Admin charges paid to Grabcar as business expense.
b. (i) Petrol costs
(ii) Car rental
(iii) Rental deposit
(iv) Maintenance costs (if applicable)
(v) Car accessories (e.g. handphone holder)
(vi) LTA fees (e.g. car conversion costs)
(viii) Parking / parking fines / road tax
IRAS: Expenses for a private hire car will be deductible only if the person is carrying on the business of hiring out cars and the private hire cars are used by the person principally for hiring. Grabcar drivers will not be allowed deduction on their motor car operating expenses since they are not in the business of hiring out cars.
Thus, the private hire car expenses and hiring charges incurred by Grabcar drivers are not tax-deductible. Any expenses incurred directly or in the form of reimbursement on using private hire cars or private cars such as repair, maintenance, parking fees, petrol costs, car rental are disallowable.
c) (i) Insurance costs
(ii) Mandatory medical checkups
IRAS: Expenses which are wholly and exclusively incurred in the production of income are deductible. Your own insurance and medical checkups expenses are private in nature and are non-tax deductible.
d) (i) Mobile Data Plan
(ii) Mobile device
IRAS: For expenses incurred by you on your Mobile Data Plan and mobile device, only that portion of the expenses incurred for your business usage is allowable as deductions. The portion of the charges incurred for your private usage is not allowable.
e) ACRA registration
IRAS: Business start-up expenses, such as ACRA registration fee, are capital expenses and not deductible. Thus, the initial ACRA registration cost is disallowable but subsequent business license renewal fees are allowable business expenses.
Q7. If I have further tax enquiries, which number should I call?
IRAS: 1800 3568300