INTERNATIONAL TAX PLAZA - Inland Revenue Authority of Singapore publishes e-Tax Guide regarding the Productivity and Innovation Credit (Fourth edition)

(September 19, 2014)

On September 19, 2014 the Inland Revenue Authority of Singapore published the fourth edition of its e-Tax Guide regarding the Productivity and Innovation Credit scheme (PIC).

PIC was introduced in Budget 2010 for Year of Assessment (“YA”) 2011 to YA 2015 to encourage productivity and innovation activities in Singapore. As announced in Budget 2014, the scheme is extended for three years till YA 2018.

In Budget 2013, an additional cash bonus (known as PIC bonus) was announced as part of a 3-year transition support package under the Quality Growth Programme. Besides encouraging investments in productivity and innovation, PIC bonus seeks to defray rising operating costs faced by businesses.

In Budget 2014, a PIC+ scheme was introduced to provide support to small and medium enterprises (“SMEs”) that are making more substantial investments to transform their businesses.

The e-Tax Guide discusses topics like a.o.:

Qualifying Equipment;
Computation of Capital Allowance under PIC – Acquisition of Qualifying Equipment;
Option to Convert Qualifying Expenditure into Cash – Acquisition of Qualifying Equipment;
PIC Bonus – Acquisition of Qualifying Equipment;
Minimum Ownership Period of Qualifying Equipment;
Computation of Deduction under PIC – Leasing of Qualifying Equipment;
Option to Convert Qualifying Expenditure into Cash – Leasing of Qualifying Equipment.

The different annexes to the e-Tax Guide discusses topics like a.o.:

Enhanced Writing-Down Allowance (“WDA”) and Deduction for Intellectual Property Rights (“IPRs”);
Enhanced Tax Deduction of Costs for Registering Patents, Trademarks, Designs and Plant Varieties;
Enhanced Tax Deduction of Qualifying Research & Development (“R&D”) Expenditure;
Enhanced Tax Deduction of Qualifying Training Expenditure;
Enhanced Tax Deduction of Qualifying Design Expenditure;
Productivity and Innovation Credit Plus Scheme (“PIC+”).

Click here to be forwarded to the e-Tax Guide as published on the website of the Inland Revenue Authority of Singapore, which will open in a new window.