Changes to Foreign Domestic Worker Levy Relief in Singapore

Understanding the Impact of FDWL Relief Removal

If you’ve been enjoying the Foreign Domestic Worker Levy (FDWL) Relief as a tax-saving measure, here’s some important news — from the Year of Assessment (YA) 2025, the FDWL Relief will no longer be available.

For many Singaporean employers, this relief meant that, in addition to paying the monthly levy for their domestic helper, they could offset part of their income tax by claiming the lower of:

• Twice the levy paid on their first FDW; or

• Their earned income for the year.

  
  

This was particularly helpful for working mothers, married men with children, and taxpayers with dependants, as it provided an additional deduction on top of other reliefs.

Why Was FDWL Relief Removed?

The change was part of the Government’s regular review of tax policies. This review ensures the system remains fair and targeted. Some families may have already benefited from multiple child-related reliefs and rebates. Thus, removing the FDWL Relief helps streamline the tax framework.

What Does This Mean for You?

From YA 2025 onwards, you will no longer enjoy an income tax deduction based on your FDW levy payments. This means your overall tax bill could be higher if you were previously claiming this relief.

But don’t worry — there’s still a way to save.

The Concessionary Levy: Your Best Ongoing Benefit

Even without the FDWL Relief, employers can continue to enjoy the concessionary levy rate of just $60/month for their first foreign domestic worker if they meet the eligibility criteria.

Who Qualifies for the Concessionary Levy?

You can get the $60/month levy rate if the helper is employed to care for:

1. Young children (below 16 years old) living with you;

2. Elderly persons (67 years old and above) in your household; or

3. Persons with disabilities (PWDs) needing assistance with daily activities.

   
   

The concessionary levy applies for one FDW per household.

How Much Can You Save?

The standard FDW levy rate is $300/month. By paying only $60/month, you save $240 every month, or $2,880 a year — and these savings are in cash, not just in reduced tax.

Quick Tips to Maximise Savings in 2025 and Beyond

• Ensure eligibility: If you have young children, elderly parents, or dependants with disabilities, make sure you are eligible for the concessionary levy with MOM.

• Plan your helper’s duties: Clearly state caregiving as part of the FDW’s job scope to meet the conditions.

• Explore other reliefs: Look into child-related reliefs, Grandparent Caregiver Relief, or rebates like the Parenthood Tax Rebate to help offset your taxes.

  
  

The Bottom Line

While the FDWL Relief may be gone, the concessionary levy remains a powerful way to keep your household helper costs down. For many families, the monthly levy savings can exceed the old tax relief — and it’s cash back in your pocket, not a deduction at tax time.

If you’re unsure whether you qualify for the concessionary levy or need help applying, check the MOM website or consult a licensed employment agency for guidance.

Conclusion: Navigating the New Tax Landscape

As we move forward into the new tax landscape, it’s essential to stay informed about changes that affect your finances. The removal of the FDWL Relief may seem daunting, but understanding your options can help you adapt.

Consider the benefits of the concessionary levy and ensure you meet the eligibility criteria. By doing so, you can continue to enjoy significant savings.

In addition, exploring other available reliefs can further ease your financial burden. Remember, staying proactive is key to managing your expenses effectively.

For more information on tax reliefs and eligibility, visit the MOM website.

By keeping yourself informed and planning ahead, you can navigate these changes smoothly and maintain financial stability for your household.