Dosh from the government

Recently my mum has been asking me about “the money that government gives upon having a baby”, which prompted me to do some research. I do hope they don’t have a change in policy anytime soon, which was what happened to me as a kid. When I was born the government was saying “stop at 2”, so my parents went all the way and stopped at 1. What do you know, at the precise time I was applying for primary school, they decided “3 or more if you can afford it” was the way to go. I ended up in last priority in primary school admissions and had to go to a school that nobody wanted to go to. It all worked out fine in the end but I could just as easily have been led astray as a result of going to a crappy school. Anyway, I digress. School admission was a different topic for a different day. Today’s topic is $$$$.

I’ve listed below the monetary benefits that the Singapore government is dishing out at the moment to encourage more people to have babies. If I’ve missed out anything, do drop me a comment!

Baby Bonus

I’ve heard this term thrown around alright, but I didn’t really know what it was and initially even got it mixed up with the CDA account, which I now understand is a separate creature altogether (see next item).

Essentially baby bonus is a cash gift of up to $4,000 for the first and second child and $6,000 for the third and fourth child. A child is eligible if he or she is:
a. born on or after 17 August 2008;
b. a Singapore Citizen or becomes a Singapore Citizen;
c. born alive to the mother; and
d. the mother is lawfully married to the child’s father.

I’m still a little perturbed by the use of the term “up to” on the baby bonus website because it doesn’t then go on to say under what circumstances will parents get less than $4,000. Is it a case of me being too nit-picky about words again and whoever drafting it not really meaning anything with the words “up to”? Or perhaps some parents may not get the full amount if the baby becomes ineligible before the age of 18 months since payment is staggered with payments at 1st month, 6th month, 12th month and 18th month.

A one-stop service for joining the Baby Bonus Scheme is available at the birth registration counters at the hospitals and the Immigration & Checkpoints Authority (ICA). The hospitals are Gleneagles Hospital, KK Women’s and Children’s Hospital, Mount Alvernia Hospital, Mount Elizabeth Hospital, National University Hospital, Parkway East Hospital, Raffles Hospital, Singapore General Hospital and Thomson Medical Centre.

CDA Account

All children born on or after 17 August 2008 will enjoy Government contributions in the form of a dollar-for-dollar matching for the amount of savings contributed to the child’s Children Development Account (CDA).

The CDA is a special savings account that can be opened at any OCBC Bank or Standard Chartered Bank branch for a child who is eligible for CDA. Parents can save in the CDA any time until 31 December in the year your child turns 6 years of age. The savings will be matched up to the cap of $6,000 each for the 1st and 2nd child, $12,000 each for the 3rd and 4th child and $18,000 each for the fifth and subsequent child. The Government will match the savings in the following month. Savings will be recorded the moment they are deposited even if they are utilised before the government matching.

The savings in the CDA may be used to pay fees for all children who are attending approved institutions registered with MCYS under the Baby Bonus Scheme. These include child care centres, kindergartens & special education schools registered with the Ministry of Education, and early intervention programmes registered with the National Council of Social Service (NCSS) or the Centre for Enabled Living (CEL). The CDA savings can also be used to purchase MediShield or Medisave-approved private integrated plans for all your children and pay for all your children’s medical-related expenses. These would include consultation fees, treatment fees and prescription costs incurred at healthcare institutions.

Income tax: Qualifying Child Relief

The qualifying child must – 

  • Be unmarried; and
  • Be a legitimate child, step child or legally adopted child; and
  • Be below 16 years old or studying full-time at any university, college or other educational institution; and
  • Does not have an annual income (e.g. salary, NS pay and tax exempt income such as bank interest, dividend and pension. However, scholarship and similar allowances are excluded) exceeding $2,000 in the previous year.

With effect from Year of Assessment (YA) 2010 onwards, the income threshold has increased from $2,000 to $4,000.

Qualifying Child Relief (QCR) and Handicapped Child Relief are mutually exclusive in each year of assessment. Also, QCR is shared between 2 spouses.

A working mother and satisfying all conditions under working mother’s child relief (see below) may claim both QCR and WMCR on the same child. With effect from Year of Assessment (YA) 2009 onwards, the quantum for QCR has increased to $4,000. In addition, the maximum claim allowable for QCR and WMCR has doubled to $50,000 per child.  

Income Tax: Working Mother’s Child Relief

This can be claimed by a working mother who satisfies ALL of the following conditions:

  • Is a Singapore tax resident
  • Is married, divorced or widowed in previous year
  • Has earned income in the previous year. Earned income refers to income from employment, trade, pension, business, profession or vocation
  • Has a child who is Singapore citizen as at 31 Dec of previous year and satisfied all conditions under qualifying child relief (QCR) or handicapped child relief (HCR).

This relief on the same child even if qualifying child relief is already claimed.

The amount of working mother’s child relief (WMCR) claimable for each child is based on a specified percentage of the working mother’s earned income corresponding to the child order. For the first child its 15%, second 20%, third and beyond 25% each. Working mothers can claim WMCR up to 100% of their earned income for all her qualifying children.

The total amount of QCR/ HCR and WMCR claimable for each child is capped at $50,000.

Income Tax: Foreign Maid Levy Relief

This is not necessarily applicable to all parents but happens to be applicable in my case as I do not currently have a maid but plan to get one to help with household chores while I or my mum takes care of the baby.

This relief may be claimed if in the previous year, the claimant is a

  • Married woman who lived with your husband, OR
  • Married woman and your husband was not resident in Singapore, OR
  • Woman separated from your husband, divorced or widowed and had children who lived with you and on whom you could claim child relief.

This relief can only be used to offset against earned income.

Twice the total foreign domestic worker levy paid in the previous year on one foreign maid can be claimed regardless of whether the husband paid the levy.

Income Tax: Parenthood Tax Rebate

Parenthood tax rebate is used to offset payable income tax and may be shared between spouses based on agreed apportionment. Unutilised parenthood tax rebate can be carried forward until fully utilised.

From Year of Assessment (YA) 2009 onwards,  one can claim PTR if one is a married Singapore tax resident and the qualifying child is –

(a)  A legitimate child

  • Born to  your family on or after 1 January 2008; and
  • Becomes a Singapore citizen at the time of birth or within 12 months thereafter.

(b)  An illegitimate child

  • Born on or after 1 January 2008 and whose birth occurs before the marriage of  the natural parents; and
  • Whose natural parents become lawfully married before he reaches 6 years old; and
  • Becomes a Singapore citizen at the time of marriage of his natural parents or within 12 months thereafter.

(c)  A child

  • Legally adopted on or after 1 January 2008 but before he reaches 6 years old; and
  • Becomes a Singapore citizen at the time of legal adoption or within 12 months thereafter

From PA 2009 onwards, PTR for the first child is $5,000, second child $10,000 and third child onwards $20,000 each.

Foreign Domestic Worker Levy Concession

With this concession, the monthly levy for up to 2 foreign domestic workers drops to $170 as compared to the normal levy of $265.

A levy concession for up to two foreign domestic workers can be applied for if the applicant satisfies any of the following conditions:

  1. The employer or spouse has a child who is a Singapore citizen and below 12 years old living with him/her
  2. The employer or spouse has a grandchild who is a Singapore citizen and below 12 years old living with him/her

Grandparent Caregiver Relief

This can be claimed if:

  • the mother of the child is a working mother who is married, divorced or widowed,
  • the mother or the mother’s spouse’s/ex-spouse’s parent or grandparent is:
    • Living in Singapore in the previous year, AND
    • Looking after any of your children who is a citizen of Singapore and is 12 years old or younger in the previous year, AND
    • Not carrying on any trade, business, profession, vocation or employment in the previous year.

This can be claimed on top of parent relief / handicapped parent relief on the same parent or grandparent if the (handicapped) dependant is able to perform some caregiving activities.

This is also on top of foreign maid levy relief, provided the parent or grandparent still help to take care of your children.

$3000 can be claimed on just one parent/grandparent.


There are other possible concession permutations like taking care of elderly or disabled relatives but I have only listed the ones directly applicable to parenthood.


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