Background

Augustine Goh was born on 17 December 1980 in Singapore. During the calendar year ended 31 December 2020, he decided to be a private-hire car driver after being jobless for so long. On 1 April 2020, Augustine attained his Private-Hire Car Drivers Vocational Licence (PDVL) and started operations as a private-hire car driver in partnership with Grab.

Self-Employment Matters

During the calendar year ended 31 December 2020, Augustine recorded the following transactions pertaining to his self-employment:

Transaction 1: Applied for PDVL online via GoBusiness Licensing Portal and paid a non-refundable application fee of $40 per new application;

Transaction 2: Rented a Mazda 3 from GrabRentals, a private-hire car rental business affiliated with Grab, with no contract at $44 per day;

Transaction 3: Derived gross passenger fares of $58,500 by driving six days per week for 39 weeks in the calendar year ended 31 December 2020;

Transaction 4: Received Grab performance rebate, computed based on 20% of commissions paid to Grab, for meeting certain targets;

Transaction 5: Incurred $400 per week of driving on fuel before the application of a 29% fuel discount for renting a car from GrabRentals;

Transaction 6: Incurred $25 per month on mobile data with Singtels SIM only 20GB Plan, of which only 35% was used for private-hire car driving;

Transaction 7: Incurred $80 per month on season parking charges for a parking lot at Augustines residential area at Bedok;

Transaction 8: Paid commissions to Grab computed based on 20% of gross passenger fares, the rate of which was non-negotiable;

Transaction 9: Incurred $10 per week of driving on car maintenance, which included washing, waxing and vacuuming; and

Transaction 10: Made compulsory contributions to Augustines Medisave Account as required by the relevant legislation.

Augustine did not drive the Mazda 3 he rented on his rest days to reduce wear and tear of the vehicle to the furthest extent possible.

Personal Matters

Augustine, being single, stays with his parents. His brother, Benji Goh, stays with his wife elsewhere. Benji pays for their parents living expenses, which is about $1,800 per month. Augustine agrees that Benji and his wife claim 80% of personal reliefs on their parents. Augustines parents belong to Singapores Merdeka Generation. They are both retired in Singapore with no income. They enjoy hiking at Bukit Timah Nature Reserve over the weekends and take care of their grandchild occasionally. Augustine was a combat medic during national service. He was not a key appointment holder and did not perform reservist duties during the calendar year ended 31 December 2020. He did, however, make a donation of $1,200 to Singapore Red Cross Society.

Required: Compute Augustines income tax payable for the Year of Assessment (YA) 2021. Show all workings in your answer. Account for all income and deductions in your income tax computation. For example, if an income is not taxable, that income must be included in your income tax computation as $0. Similarly, if an expense or relief is not claimable, that expense or relief must be included in your income tax computation as $0. (25 marks)