Corporate income tax
- Corporate income tax rebate at a rate of 25% of tax payable for YA 2020, capped at $15,000.
- Automatic additional two months extension of interestfree instalments for payment of tax on ECI filed within specified period.
- The carry-back relief scheme is enhanced by increasing the carried back years to 3 immediate preceding YAs from the current 1 YA, for YA 2020. Taxpayers may also elect to carry back based on an estimated amount of qualifying deductions, subject to conditions.
- Changes to capital allowance (CA) claim.
- Option to accelerate to:
– 2-year CA claim from the 3-year for qualifying assets acquired in the basis period for YA 2021. Once accelerated write-off is selected, no deferment of claims is allowed.
– 1-year renovation and refurbishment claim from the 3-year (under section 14Q of the Income Tax Act) for qualifying expenditure incurred during the basis period for YA 2021.
- Option to simplify section 19 CA claims for qualifying plant and machinery acquired in or after FY 2022 or when acquired prior to the FY, CA claims were deferred.
- Option to accelerate to:
Goods and services tax
- GST rate to remain at 7% in 2021.
- GST will continue to be absorbed on publicly subsidised healthcare and education.
- Assurance Package will be provided when the GST rate is raised.
- Extend DTDi scheme to 31 December 2025 and the scope is expanded to include qualifying third-party consultancy costs and other qualifying overseas business missions costs for expenses incurred on or after 1 April 2020.
- Extended M&A scheme to cover qualifying acquisitions made on or before 31 December 2025. However, stamp duty relief will lapse for instruments executed on or after 1 April 2020 and no waiver for the condition that the acquiring company must be held by an ultimate holding company that is incorporated in and is a tax resident of Singapore.
- Extend the upfront certainty of non-taxation of companies’ gains on disposal of ordinary shares to 31 December 2027.
- Extend the IBD and IBD-CI schemes to 31 December 2025. However, the IBD-MHL scheme will lapse after 31 March 2020.
- Extended venture capital funding for Singaporebased companies, the Section 13H scheme and Fund Management Incentive to 31 December 2025.
- Section 14E incentive will lapse after 31 March 2020.
- Extended withholding tax exemption for non-resident mediators and arbitrators, and the 10% concessionary withholding tax rate for NRPEs to 31 March 2022.
- Incentives extended to 31 December 2025 include LIA and section 19D WDA.
- Incentives extended to 31 December 2026 include MSI scheme, WHT exemption for qualifying payments made on qualifying financing arrangements, FTC and GTP.
- Lapsed of the Angel Investors Tax Deduction after 31 March 2020.
Other tax changes
- Property tax rebate ranging from 10% to 30% for the period 1 January 2020 to 31 December 2020, for qualifying commercial properties such as licensed hotels, serviced apartments, and prescribed Meetings, Incentive, Conferences and Events (MICE) venues.
- Changes to road tax for Electric Vehicles and Hybrid Cars.