HRSINGAPORE Community Discussions
Taxation of Dependent Pass Fees
Dear HR Practitioners,
Are the fees paid by the company to apply/issue dependent passes considered a benefit in kind to the employee to be taxed?
Appreciate your kind advice.
It should be considered by laws (rules and regulations) of a certain country.
The first step is to determine if the benefit is taxable.
It is to determine whether the benefit provided by the company to the employee is taxable and has to be included the fees paid in their employment to apply for dependent passes when the benefit is received or enjoyed. The manner in which the company pays or provides the benefit to the employee will affect the payroll deductions the company has to withhold.
The second step is to calculate the value of the benefit.
Once determined that the benefit is taxable, then it is needed to calculate the value of the specific benefit. The value of a benefit is generally its fair market value (FMV). This is the price that can be obtained in an open market between two individuals dealing at arm's length. The cost to the company for the particular property, good, or service may be used if it reflects the FMV of the item or service. The company must be able to support the value if you are asked.
We treat this as government fees, just like foreign worker levy, instead of benefits in kind.