The conclusion of the Singapore Government's Productivity and Innovation Credit scheme.
YA2018 marked the conclusion of the Singapore Government's Productivity and Innovation Credit ("PIC") scheme ("Scheme"), which encouraged companies to boost productivity by providing considerable tax incentives. The end of the well-utilised Scheme (used by 85.4% of businesses in 2017) may cause concern to the start-ups and small and medium enterprises ("SMEs") which relied on it to support research and development initiatives. Between YA2011 to YA2018, the Scheme allowed businesses to enjoy 400% tax deductions/allowances for qualifying expenditure incurred in the acquisition and leasing of PIC information technology and automation equipment, training of employees, acquisition and licensing of intellectual property rights, registration of patents, trademarks, designs and plant varieties, research and development activities, and design projects approved by the Design Singapore council. Eligible businesses had the additional option of converting up to S$100,000 of their total qualifying expenditure for each year of assessment into a non-taxable cash pay-out, in lieu of the tax deduction.
While the PIC Scheme had run its course, there remains a plethora of schemes supported by the Singapore Government which provide funding, tax and other assistance to start-ups and SMEs. Last month, the Singapore Government announced Budget 2018 which introduced a raft of new measures to support start-ups and SMEs, as well as a streamlining of existing measures to make access to such assistance more user-friendly. The tables linked below provide a summary of business incubation, cash grant, equity-based co-financing, loan financing and tax schemes available to start-ups in Singapore. Special thanks to trainee solicitor Xing Yi Tan for her assistance in the collation of information.