Corporate Tax Rates, Corporate Income Tax Rebates, Tax

2016/5/24

Corporate Tax Rates, Corporate Income Tax Rebates, Tax Exemption Schemes and SME Cash Grant IRAS

Home > Businesses > Companies > Learning the basics of Corporate Income Tax >

Corporate Tax Rates, Corporate Income Tax Rebates, Tax Exemption Schemes and SME Cash Grant Tax Rates, Corporate Income Tax Rebates, Tax Exemption Schemes and SME Cash Grant for both local and foreign companies. Jump To

Select Subheading

The table below gives an overview of the Corporate Tax Rates, Corporate Income Tax Rebates, Tax Exemption Schemes and SME Cash Grant.

Year of Assessment (YA)

Tax rate

Tax exemption/ rebate

From 2010

17%

Partial tax exemption and tax exemption scheme for new start up companies Companies, will continue to enjoy the partial tax exemption and tax exemption for new startup companies, as provided in the tables below.

Partial tax exemption for companies % exempted from Tax

Chargeable income

Amount exempted from Tax

First $10,000

@75%

=$7,500

Next $290,000

@50%

=$145,000

Total $300,000

=$152,500

2016/5/24


Tax exemption scheme for new startup companies % exempted from Tax

Chargeable income

Amount exempted from Tax

First $100,000

@100%

=$100,000

Next $200,000

@50%

=$100,000

Total $300,000

=$200,000

For more details on the above exemptions, please refer to Common Tax Reliefs That Help Reduce The Tax Bills.

YA 2016 and YA 2017 Companies will be granted a 50% Corporate Income Tax Rebate capped at $20,000 for each YA. New!

YA 2013, YA 2014 and 2015 Companies will be granted a 30% Corporate Income Tax Rebate capped at $30,000 for each YA.

YA 2012 For YA 2012, companies will be granted a oneoff 5% SME Cash Grant.

YA 2011 For YA 2011, companies will be granted a 20% Corporate Income Tax Rebate or 5% SME Cash Grant, whichever is the higher amount.

BACK TO TOP

Corporate Tax Rates With effect from Year of Assessment 2010, a company is taxed at a flat rate of 17% on its chargeable income regardless of whether it is a local or foreign company.


Tax Rate

2016/5/24


From 2010

17%

2008 to 2009

18%

2005 to 2007

20%

BACK TO TOP

Corporate Income Tax Rebate for YAs 2013 to 2017 Corporate Income Tax Rebate is given to all companies* to help them deal with rising business costs. The Minister for Finance has announced in Budget 2016 that to help businesses, especially SMEs, to restructure in the midst of the current economic climate, the Corporate Income Tax Rebate for YAs 2016 and 2017 will be raised to 50% of the corporate tax payable, up from the 30% announced in Budget 2015. The rebate will be subject to a cap of $20,000 per YA. For YA 2013 to YA 2015, all companies will be granted a 30% Corporate Income Tax Rebate capped at $30,000 per YA. The table below summarises the rates of the rebates and maximum rebates to be given.


Corporate Income Tax Rebate

Capped at

2016 and 2017

50%

$20,000

2013 to 2015

30%

$30,000

The rebate will not apply to income derived by a nonresident company that is subject to final withholding tax. Companies need not factor in the Corporate Income Tax Rebate when filing the Estimated Chargeable

Income and the Income Tax Return (Form CS/ C) as IRAS will compute it and allow the Corporate Income Tax Rebate automatically. *includes Registered Business Trusts, nonresident companies that is not subject to a final withholding tax and companies that receive income taxed at a concessionary tax rate.

2016/5/24


How the Corporate Income Tax Rebate is Computed The rebate will be computed on the tax payable after deducting the tax setoffs (e.g. foreign tax credit).

Example (1): Company with no chargeable income Chargeable income

=

Nil

Tax payable

=

Nil

Corporate Income Tax Rebate does not apply as there is no tax to be paid.

Example (2): Company with income taxable at 17% Chargeable income (after exempt amount)

$10,000

Tax payable at 17%

$1,700

Less: Corporate Income Tax Rebate ($1,700 x 30%)

Net tax payable

$510

$1,190

Example (3): Company with income taxable at 17% and a concessionary rate of 10% Chargeable income @10%

$180,000

Chargeable income @17% (after exempt amount)

$500,000

YAs 2013 to 2015

2016/5/24


Gross tax payable ($180,000 x 10% + $500,000 x 17%)

$103,000

Less: Corporate Income Tax Rebate ($103,000 x 30% = $30,900; restricted to cap of $30,000

$30,000

Net tax payable

$73,000

Gross tax payable ($180,000 x 10% + $500,000 x 17%)

$103,000

Less: Corporate Income Tax Rebate ($103,000 x 50% = $51,500; restricted to cap of $20,000

$20,000

Net tax payable

$83,000

YAs 2016 and 2017

BACK TO TOP

SME Cash Grant for YA 2012 The SME Cash Grant is given to companies (including registered business trusts) to offset high costs during business slowdowns and is aimed at providing support for companies that face increased business costs. For YA 2012, companies are granted a oneoff SME Cash Grant pegged at 5% of total revenue*, up to a maximum of $5,000. The revenue refers to the main income source declared in the company's YA 2012 income tax return. To be eligible for the SME cash grant, the company must have made CPF contributions for at least one employee during the basis period for YA 2012; the employee must not be a shareholder of the company.

2016/5/24


* If the revenue as per your accounts is for a period that covers two YAs, one of which is YA 2011 or YA 2012, please provide a breakdown of your revenue for the basis period relating to YA 2011 and YA 2012 in your tax computation. This is to allow IRAS to compute the correct amount of SME cash grant/ rebate for the relevant YA.

Example of how to provide a breakdown of your revenue: Company A was incorporated in Singapore on 15 Apr 2010 and commenced business on the same day. The financial year end of the company is 30 Jun. Company A's first set of accounts is prepared for the period from 15 Apr 2010 to 30 Jun 2011. As the first set of accounts covered a period of more than 12 months, there are two relevant YAs as follows:

YA

Basis Period

2011 (1st YA)

15 Apr 2010 30 Jun 2010

2012 (2nd YA)

1 Jul 2010 30 Jun 2011

The company has to prepare tax computations for the two YAs for submission in 2012. It has to also provide a breakdown of its revenue for the basis period from 1 Jul 2010 to 30 Jun 2011 in the tax computation for YA 2012. Where the breakdown is not provided, IRAS may use the time apportionment basis to compute the applicable amount of revenue.

Payment of SME Cash Grant Companies do not need to apply for the SME Cash Grant. Upon the company's filing of the YA 2012 income tax return, IRAS will compute and advise the SME Cash Grant amount. The YA 2012 SME Cash Grant has ceased on 31 May 2014 and no SME Cash Grant will be disbursed for any company's YA 2012 filing that is received after 31 May 2014.

BACK TO TOP

Corporate Income Tax Rebate and SME Cash Grant for YA 2011 To help companies cope with the rising costs of doing business, the Minister for Finance has announced in Budget 2011 that for Year of Assessment (YA) 2011, companies will receive:

1. A Corporate Income Tax Rebate; or 2. A SME Cash Grant,

2016/5/24


whichever is the higher amount.

Corporate Income Tax Rebate A 20% Corporate Income Tax Rebate, subject to a cap of $10,000, will be allowed to each company for YA 2011. The rebate will be computed on the tax payable amount after deducting tax setoffs (e.g. double tax relief and unilateral tax credit).

OneOff SME Cash Grant Recognising that many small companies are not taxable and would not be able to benefit from the Corporate Income Tax Rebate, a oneoff SME cash grant of 5% on total revenue for YA 2011*, subject to a cap of $5,000 will be separately given to them. Like the Corporate Income Tax Rebate, this SME cash grant initiative is aimed at providing oneoff support for companies that face increased business costs. * If the revenue as per your accounts is for a period that covers two YAs, one of which is YA 2011, please provide a breakdown of your revenue for the basis period relating to YA 2011 in your tax computation. This is to allow IRAS to compute the correct amount of SME cash grant/ tax rebate for YA 2011.

Please refer to the example above on how to provide a breakdown of its revenue for the basis periods for the two YAs.

Scope and Conditions Corporate Income Tax Rebate Corporate Income Tax Rebate will be given to all companies (including Registered Business Trusts) regardless of tax residency status and eligibility for concessionary corporate tax rate, except income of nonresident company that is subject to final withholding tax. SME Cash Grant To be eligible for the SME cash grant, the company or registered business trusts must have made CPF contribution for at least one employee during the basis period of YA 2011. If no CPF contribution is made, the company or registered business trust will only be eligible for the Corporate Income Tax Rebate; Companies and registered business trusts will automatically receive the higher of Corporate Income Tax Rebate amount or the SME cash grant amount. Corporate Income Tax Rebate will be given if both amounts are the same. Calculator You may use this calculator (382KB) to estimate your YA 2011 Corporate Income Tax Rebate or SME cash grant.

2016/5/24


Payment Companies do not need to apply for the Corporate Income Tax Rebate or SME cash grant. IRAS will compute the amount of the Corporate Income Tax Rebate or the SME cash grant which a company will receive when companies file their YA 2011 income tax return (i.e. Form C) by the 30 Nov filing deadline.

BACK TO TOP

Last updated 31 Mar 2016 Privacy Policy | Terms of Use | Rate This Site | Sitemap © 2016 Inland Revenue Authority of Singapore. All Rights Reserved

Corporate Tax Rates, Corporate Income Tax Rebates, Tax

Recommend Documents