Income Tax – Deductibility of expenses on transportation services such as Uber Singapore


No doubt Uber is getting more popular in Singapore.  Basically, it’s an online ride-booking app that helps commuters book a taxi or private car to take them to their desired destination for a fee that could be more expensive or cheaper than booking a regular cab  depending on the time and availability of cars to book.

One income tax issue arising from this new trend is whether expenses incurred on transportation services such as Uber for business purposes would be deductible for tax purposes.  Are they in nature of private car or private hired car expenses which for Singapore tax purposes are not deductible, even though they might be incurred for business purposes?

It has been clarified by IRAS that expenses on transportation services such as Uber would be deductible.  IRAS states that such expenses should be distinguished from those to hire a private car in that the former represents payments for services to commute from one place to another without the passenger having any control or possession of the motor car.   In the case of hiring charges for SZ-plated and S-plated cars, the motor car would be at the disposal of the hirer.

So, expenses on engaging Uber services for business purposes would be tax deductible for Singapore tax purposes even though the vehicle is a S-plate car.

If you have any questions regarding the above, please contact us at support@whm-consulting.com.

Be Well!
Jack:)

 

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