6 tax deductions Singapore startups didn't know

November spells tax time for Singapore companies. We examine six tax deductions not commonly understood by startups in Singapore.

Get ready to impress your tax accountant with these six deductions.

Wage credit scheme

There’s been a steep increase for employee’s payroll. How do you as a director combat that?

The government will co-fund up to 40% of wage increases given to Singapore Citizen employees for those who earn $4,000 and below per month. This scheme is valid until 2015. There are also automatic payments received each year from CPF board based on monthly submissions.

This scheme was introduced tohelp businesses that are cash-strapped in this tight labour market. In other words, you’ll have more money to make investments.

Startup Tax Exemption (SUTE)

You’re a start-up. You have enough strain on your cash flow. The future looks bleak. What should you do?

With SUTE, you can have a piece of mind. Under this scheme, a newly incorporated company that meets the qualifying conditions can claim for full tax exemption on the first $100,000 of normal chargeable income for each of its first three consecutive Year of Assessments.

This scheme was launched to support entrepreneurship and help local enterprises grow. Now that you know this, gone are the nightmares of the tax man bugging you for three years.

Corporate income tax rebate

This is the easiest scheme to get rich. It’s literally like writing yourself a cheque.

Announced in 2013, all Singapore companies are eligible. Nope, there’s no catch to it. This scheme was launched to help companies cope with rising business costs.

You’ll receive 30% rebate up to $30,000 off your tax bill for 2013, 2014 & 2015. You’re only applicable for the Partial tax rebate scheme from the fourth year onwards.

Productivity & Innovation Credit

Are you obsessed with the newest iPad Air? Or do you just need to have the most expensive all-in-one printer – Xerox 700i? Go ahead, get them.

Buy the latest, most expensive gadgets and receive significant tax deductions or partial cash back.

Other activities where you can claim for PIC includes:

- Training, including internal training;

- IT spend including cloud services, software, hardware & printers;

- IP including registering your trademark;

- Upto $15,000 cash bonus - Eg. An investment of $1000 in a cloud accounting implementation is eligible for a total of $1600 cashback & cash bonus;

- Cheque received every quarter from Inland Revenue.

Angel Investors Tax Deduction Scheme

Invest in startups in Singapore and receive fat tax benefits. We’re talking up to $250,000 each year.

The scheme makesit a super attractive incentive to galvanize Angel funding for local startups.

The investor will enjoy 50% tax deduction on the investment costs at the end of a two-year holding period, up to a maximum of S$500,000 of investments in each Year of Assessment.

Condition? The minimum investment must be at least S$100,000 within 12 months from becoming an approved investor.

Investments made from 1 March 2010 to 31 March 2015 are eligible for the tax deduction.

Section 14Q deductions

Who wouldn’t want their office to look beautiful? It’s expensive you say?

Fret not, with 14Q deductions, you can claim for most renovation and any items that are office-related. The only exceptions are designer fees, art pieces and antiques.