Double Tax Deduction for Internationalisation Scheme

To encourage internationalisation, businesses may claim automatic double tax deduction on up to $100,000 of qualifying expenses incurred from 1 April 2012 to 31 March 2020, subject to conditions. This is provided for under Sections 14B and 14K of the Income Tax Act.

Businesses may also apply to IE Singapore or Singapore Tourism Board (STB) to claim double tax deduction for qualifying expenses incurred on qualifying market expansion and investment development activities that exceeds the $100,000 cap, or on expenditure incurred for other qualifying activities, on a case by case basis.

 

Qualifying Activities

Businesses may claim automatic double tax deduction (DTD) on up to $100,000 of qualifying expenses in the following four qualifying activities, without approval from IE Singapore or STB:

(a)   Overseas business development trips/ missions;

(b)   Overseas investment study trips/ missions;

(c)   Participation in overseas trade fairs; and

(d)   Participation in approved local trade fairs.

Expenditure exceeding S$100,000 will require approval from IE Singapore or STB.Businesses should maintain documentation as proof of expenditure and purpose. Please refer to IE Singapore's circular on the “Double Tax Deduction for Internationalisation FAQ" for the eligibility criteria, list of qualifying activities and the corresponding qualifying expenses where double tax deduction can be claimed.    

Please refer to Extension of Scheme for the qualifying period of the scheme.   

In Budget 2015, the scheme was further enhanced to provide greater support for businesses expanding overseas and create skilled jobs for Singapore. Double deduction is extended to qualifying salary expenses incurred, between 1 July 2015 and 31 March 2020, for Singaporean and Permanent Resident employees posted to an overseas establishment of the approved firm or company. The amount of qualifying manpower expenses to be allowed double tax deduction under the scheme will be capped at $1 million per approved entity per year, subject to conditions. Businesses will have to apply to IE Singapore to enjoy the double tax deduction on qualifying salary expenses incurred from 1 July 2015 to 31 March 2020. 

Extension of Scheme

To continue to support businesses in their internationalisation efforts, it was announced in Budget 2016 that the Double Tax Deduction for Internationalisation Scheme will be extended to 31 March 2020:  

(a)  Automatic double tax deduction will apply for qualifying expenditure incurred from 1 April 2012 to 31 March 2020.

(b)  Approval window for qualifying expenditure incurred in excess of $100,000 and on other qualifying activities will be from 1 April 2012 to 31 March 2020.

 

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