You might not know this, but it is possible to lower your taxes while supporting your favorite charity. If at all you decide to itemize deductions, it is in your best interest to consider donating profitable investments or selling losing assets before gifting the cash proceeds. That’s what you need to enjoy donation tax relief in Singapore.
However, it is harder to claim the charitable deduction than some people think in the first place. When filing your return, you reduce your taxable income by subtracting the greater of either the standard deduction or your total itemized deductions. This may include charitable donations. So, take it upon yourself to do your homework before claiming a donation tax relief.
The good news is you can maximize your donation tax relief without pushing yourself to the limit. And an ideal way to save money on taxes, be charitable, and clean out your basement at the same time is by donating household goods as well. Actually, there are many charities and church organizations that accept donations of clothing and household items to give away or resell to those in need.
But one thing to always remember is that the rules for non-cash donations tend to be a little stricter than those for cash ones. You’re allowed to donate goods at their estimated value at the donation time, not at the value they had when first purchased. So, always keep this in mind while making non-cash donations.
If at all you volunteer for a charitable organization and have reimbursed car expenses, rest in knowing you can claim them as a charitable gift. Of course, this is only possible if you have maintained excellent bookkeeping records. The miles you drive in the year for the charity need to be logged in a mileage log, including the date of each trip and purpose of the trip, not forgetting the total miles driven.
The Bottom Line
The above are merely some of the things you need to know before you finally make up your mind to request a donation tax relief in Singapore. Remember, there are numerous things you can do to maximize your tax deduction.
It narrows down to the simple tips you employ. Plan your giving, get a receipt for your donations, donate household goods, and don’t forget vehicle expenses. It is then that you can better maximize your donation tax relief.