Benefit-in-kind and Perquisites from Employment Part 2 of 4 

eKTP 72

011.  Benefit-in-kind (BIK) vs Perquisite

Types of benefit

a) Household servants, Gardener, Driver, Domestic Helper, Guard

Benefit-in-kind

• Hired by employer
• Employee entitled to the benefits
• Taxable under S13(1)(b)

Perquisite

• Hired by employee
• Reimbursed by employee
• Taxable under S13(1)(a)
  

b) Utilities bills (e.g. electricity, water and other utilities)


c) Mobile phone / telephone **

Benefit-in-kind

• Bills under employer’s name
• Employer subscribes to these utilities
• Employee enjoys the benefits provided by the employer
• Taxable under S13(1)(b)

Perquisite

• Bills under employee’s name
• Employer gives money to employee to settle bill
• Employer pays directly to authorities concerned
• Taxable as perquisite under S13(1)(a)

** Monthly bills paid by the employer for the fixed line telephone, mobile phone bills, pager or personal data assistance (PDA) registered under the name of employee is fully exempted from tax.
 

d) Club membership

Benefit-in-kind

• Corporate membership
• Entrance fee - Not taxable
• Annual membership fee - taxable
• Under S13(1)(b) income

Perquisite

• Individual membership
• Entrance fee - taxable
• Annual membership fee - taxable
• Under S13(1)(a) income

022.  Others taxable as Benefit-in-kind

 a) Motorcar and other related benefits

• Private usage – Taxable
• Private usage:Used for traveling between the office and homeKept at employee’s home

Private usage:

• Used for traveling between the office and home
• Kept at employee’s home

• Taxable value:Formula method (i.e. cost of asset / prescribed life span), or MIRB’s prescribed value (car and fuel)Also applicable to secondhand and leased/rented motorcarIf Motorcar > 5 years, taxable value of motorcar is half of prescribed valueTaxable value of fuel is unchanged

Taxable value:

• Formula method (i.e. cost of asset / prescribed life span), or MIRB’s prescribed value (car and fuel)
• Also applicable to secondhand and leased/rented motorcar
• If Motorcar > 5 years, taxable value of motorcar is half of prescribed value
• Taxable value of fuel is unchanged

• Fuel provided without carTaxable value = Total value of petrol provided

Fuel provided without car

• Taxable value = Total value of petrol provided

To-be continued...