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The following donations made by Greenery Pte Ltd
The following donations made by Greenery Pte Ltd. The company closes it’s accounts on 30 November every year. Year ended 30 November 2020:
Date Institutions Amount S$ Remarks
1/1/20 National Kidney Foundation* 12,000 Cash 30/1/20 NUS library* 8,000 Books 4/4/20 St. John’s Home for the Aged* 600 Beds 30/6/20 Children Aid Society* 4,000 Cash 3/8/20 Singapore Polytechnic 1,200 Cash
------- 25,800
=====
*approved institutions of public character The amount of tax deductible for Greenery Pte Ltd for the year of assessment 2021 will be:
a. $25,800
b. $40,000
c. $43,000
d. $17,200
Expert Solution
As per Tax laws of Singapore, only following donations made to Institutes of Public Character (IPC) are allowed as tax deduction @ 250% of the amount donated.
1.Cash Donations
2.Computer Donations
3.Share Donations
4.Artefact Donations
5.Donations under the Public Art Tax Incentive Scheme (PATIS)
6.Land and Building Donations
From above it can be concluded that following donations made by Greenery Pte Ltd shall be allowed as tax deduction for assessment 2021:
1. National Kidney Foundation - $12,000 - Cash
2. Children Aid Society - $4,000 - Cash
Total allowable deductions = $16,000
Amount allowed as deduction = 16,000 * 250% = 40,000
Hence the correct option is $40,000 i.e. Option b.
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