IRAS issues revised e-Tax Guide on Productivity and Innovation Credit (Third Edition)

23 September 2013

The revised edition of the e-Tax Guide on Productivity and Innovation Credit (PIC) was issued by the Inland Revenue Authority of Singapore (IRAS) on 20 September 2013. The PIC scheme was introduced in Budget 2010 and the first edition of the e-Tax Guide to the scheme was published on 15 July 2011, followed by a second edition on 17 August 2012.

In the third edition, amendments were made to reflect the introduction of the PIC bonus and enhancements to the PIC scheme announced in Budget 2013.

With effect from year of assessment 2013, the PIC scheme is enhanced as follows:

  1. The term “automation equipment” has been changed to “information technology (IT) and automation equipment” as PIC already supports IT-related software besides automation equipment.
  2. PIC IT and Automation Equipment (Annex A)
    • The criteria for approving automation equipment on a case-by-case basis are liberalised. Basic tools may also be approved for purposes of PIC if they meet the approval criteria.
  3. Licensing of qualifying Intellectual Property Rights (IPRs) (Annex B)
    • Licensing of qualifying IPRs is included as one of the qualifying activities under PIC.

The e-Tax guide is available on the IRAS website.

Source: Inland Revenue Authority of Singapore

Singaporeans in support of Budget measures to tighten foreign manpower and improve productivity

25 March 2013

A post-Budget poll conducted by REACH has found that eight in ten Singaporeans supported the Government’s Budget 2013 initiatives.

The poll showed that measures relating to restructuring the economy for quality growth, such as the Wage Credit Scheme, and the tightening of foreign worker policies, were the most warmly welcomed, with almost 9 in 10 respondents in favour of the latter.

Singaporeans also welcomed various initiatives including the progressive property tax structure, additional GST Voucher, personal income tax rebate and the reduction of the foreign domestic worker levy, all of which work towards building a more inclusive society.

Noting the particularly strong support for measures relating to the tightening of foreign manpower and improving productivity, REACH Chairman, Dr Amy Khor said: “Singaporeans now have more information on the Government’s plans to build a more inclusive and better Singapore in areas such as promoting social mobility through education and reviewing healthcare financing. REACH will continue to gather Singaporeans’ sentiments and concerns on these key issues.”

Source: REACH

Singapore Budget 2013 Report by Crowe Horwath First Trust Tax

22 March 2013

Crowe Horwath First Trust Tax is pleased to present our Singapore Budget 2013 Report to our valued clients.

The report provides a succinct coverage of the key tax changes for businesses and individuals in a “pre” and “post” Budget format for quick and easy comparison. It also features an Executive Overview by our Head of Tax, Mr Sivakumar Saravan, analysing these changes and their impact.

To view the full report, please click here:

Click to access budget-2013-newsletter.pdf

IRAS provides details regarding Corporate Income Tax Rebate for the Years of Assessment 2013 to 2015

18 March 2013

As announced in Budget 2013, companies will receive a 30% Corporate Income Tax (CIT) Rebate for the Years of Assessment (YA) 2013 to 2015, subject to a cap of $30,000 per YA. The IRAS has now provided details of the said rebate.

The CIT rebate will be given to all companies including Registered Business Trusts, companies that are not tax resident in Singapore and companies that receive income taxed at a concessionary tax rate. It will not apply to the amount of income derived by a non-resident company that is subject to final withholding tax.

The rebate will be computed on tax payable after deducting tax set-offs (eg foreign tax credit). Examples of how the rebate is calculated can be found on the IRAS website.

Rebate for YA 2013

The CIT rebate will be automatically computed by the IRAS when it assesses companies’ income tax returns (ie Form C/ Form C-S). Companies that have not filed their Estimated Chargeable Income (ECI) for YA 2013 may submit their ECI based on the net tax payable after taking the CIT rebate into account. Companies that have already submitted their ECI prior to the Budget Announcement can submit a revised ECI if they wish to reduce their ECI based on the net tax payable after CIT rebate.

Rebate for YAs 2014 and 2015

Companies do not need to take the CIT rebate into account in their ECI for YAs 2014 and 2015 as this will be automatically computed and allowed by the IRAS when it raises the ECI assessment. Companies that have already filed their ECI for YA 2014 need not revise their ECI filings as the IRAS is currently making system changes and will revise these assessments to take the CIT rebate into account and notify the affected companies accordingly.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website. Visit for more information.

Wage Credit Scheme is most popular topic of Budget 2013

15 March 2013

According to the REACH Post-Budget Feedback Exercise to seek Singaporeans’ views on Budget 2013, the Wage Credit Scheme (WCS) was the most hotly discussed Budget 2013 measure.

While the WCS was welcomed by REACH contributors as a generous measure to increase wages for Singaporeans, there were concerns that employers may not be willing to share the productivity gains with their employees, or may try to exploit loopholes in the scheme. In this regard, many felt that it was critical for firms to focus on increasing their productivity.

Although productivity measures such as the Productivity Innovation Credit (PIC) Bonus were generally welcomed, concerns were raised on implementation details (eg whether small firms were able to invest the minimum $5,000 to take advantage of the PIC bonus). Beyond providing a cash incentive, contributors suggested that the Government do more to encourage knowledge transfers or provide productivity solutions to companies.

Other topics discussed included the tightening of foreign worker policies; a more progressive fiscal system (on tiered Additional Registration Fee and Progressive Property Tax); and the direct assistance schemes to help Singaporeans cope with the cost of living.

REACH Chairman Dr Amy Khor said: “Budget 2013 is a bold yet balanced Budget which has been carefully crafted and calibrated to ultimately benefit Singaporeans with better opportunities and more fulfilling lives”, adding that “All these are useful feedback for the Government, as we fine-tune our policies.”

Source: REACH