SINGAPORE BUDGET 2008 - HIGHLIGHTS OF TAX BENEFITS

Tax benefits for companies  

Start-up exemption Scheme

To promote entrepreneurship, a company can now be partly owned by corporation to enjoy the tax exemption of $100,000 on normal chargeable income for each of its first three consecutive tax filing years. Tax exemption is now allowed as long as there is at least one individual shareholder that holds at least 10% of the shares.

Tax incentive for Furniture and Fittings

with effect from 15 February 2008, expenditure incurred on fixture, fittings and furniture except those relating to structure or expansion of building space can be claim up to a maximum of $150,000 every 3 years of business.

R & D Incentive for Start-Up Enterprise

Start-up enterprise is allowed to convert $225,000 of its losses arising from tax deduction for R &D, to cash grants of up to $20,250. 

Tax deduction for R & D Expenditure - All Companies

Tax deduction for R & D is increased to 150% effective from year of assessment 2009 to 2013. Locally done R &D that are not related to the companies existing business can also qualify for the deduction

R & D tax Allowances

New R & D allowances is granted for YA 2009 to 2013 amounting to 50% of the first $300,000 of chargeable income for each year of assessment. The allowance can be utilised against the incremental expenditure on ongoing R & D within 3 years of assessment the allowance is given. 

Foreign Tax Credit for Foreign-Source income

With effect from YA 2009, unilateral tax credit is claimable on foreign tax incurred on all types of foreign income earned on countries that had yet to conclude the Avoidance of Double Tax Agreement (DTA)