2. I am married. How do I claim the "Married Person's Allowance", choose either "Joint Assessment" or "Personal Assessment", or nominate my spouse to claim the deduction for "Home Loan Interest"?
a) Claiming the "Married Person's Allowance"
- If you are married for the full year or part of the year and your spouse does not have any income chargeable to Salaries Tax during the year, you should complete Part 8.1 in order to get the "Married Person's Allowance" under Salaries Tax assessment. There is no need for you to complete either Part 4.4 to elect "Joint Assessment" or Part 6 to elect "Personal Assessment".
- If you have chosen "Joint Assessment" under Salaries Tax in Part 4.4 and/or "Personal Assessment" in Part 6 of your tax return, you should also complete Part 8.1 in order to get the "Married Person's Allowance".
b) Choosing "Joint Assessment"?
Generally speaking, if both husband and wife have income from salaries and one of them has an assessable income lower than his/her entitlements to allowances and concessionary deductions, choosing Joint Assessment will be advantageous. In order to choose the “Joint Assessment” option, both husband and wife have to complete their own tax returns.
If only one spouse has income from salaries and the other does not, there is no need to choose "Joint Assessment". Under Salaries Tax, so long as the salary-earning spouse has completed Part 8.1 of the Tax Return properly, the "Married Person's Allowance" will be granted.
c) Choosing "Personal Assessment"?
There is no need to choose "Personal Assessment"; if you ONLY have salary income. You may still claim allowances and deductions under Salaries Tax assessment. However, if you earn rental income (on which you may be required to pay property tax) or have business profits, you should consider if the choice of "Personal Assessment" can reduce your overall tax liability. For instance, if you have borrowed money to purchase a property for letting out, deduction of mortgage interest from your rental income can only be claimed when you choose "Personal Assessment".
For married taxpayers, their spouse must sign Part 9 of the Tax Return to confirm their agreement to choose either the "Joint Assessment" or the "Personal Assessment".
d) The nomination of a spouse to claim the "Home Loan Interest" deduction is applicable only if your spouse has no income chargeable to tax (including rental income, salaries income and business profits). If your spouse has income chargeable to tax, he/she cannot nominate you to claim this deduction. However, you may seek the full "Home Loan Interest" deduction through the choice of either "Joint Assessment" or "Personal Assessment".