![]() Staff remunerations (salary, bonus, and allowances).Ex-gratia retrenchment payments and outplacement support costs, where there is no complete cessation of business.Registration of patents, trademarks, designs, and plant varieties.Reinstatement costs (expenses incurred to reinstate premises to their original condition before vacating them at the end of the tenancy agreement).Provision for obsolete stocks (specific).Provision for bad and doubtful debts (specific), (note impairment loss on trade debts).Motor vehicle expenses (such as upkeep, maintenance, running, and financing costs of goods/commercial vehicles, e.g., van, lorry, and bus).Medical expenses (restricted to 1%/ 2% of total remuneration if the company is under Portable Medical Benefits Scheme (PMBS) or Transferable Medical Insurance Scheme (TMIS).Legal and professional fees (trade and revenue transactions).Intellectual property (IP) licensing expenditure.Interest incurred on loans to re-finance prior loans or borrowings.Interest incurred on late payment of fees to a Management Corporation for a Strata Title Plan (MCST).Insurance for underwriting bad trade debts.Employee’s income tax borne by employer (under an employment contract).Exchange loss (trade and revenue in nature).Employee Equity-Based Remuneration (EEBR) Scheme.Digital taxes imposed in the form of turnover taxes (not income taxes).Voluntary cash contributions to self-employed persons’ MediSave Account.Topping-up Employees’ CPF Retirement Accounts/ Special Accounts on their behalf.Ad-hoc contributions to employees’ MediSave Account.Foreign worker levy (FWL For companies that have received FWL rebate, only the reduced FWL incurred by the companies will be allowed the tax deduction.).Borrowing costs as a substitute for interest expense or to reduce interest costs.Here is an exhaustive list of deductible expenses according to the Inland Revenue Authority of Singapore (IRAS): Expenses are not prohibited under the Income Tax Act.These refer to liabilities that could be incurred in the future depending on possible outcomes such as a pending lawsuit. Expenses are not a contingent liability. ![]() ![]() An example of this is expenses incurred in the daily operations of the business such as buying a new goods truck or a new commercial property to house the business. Expenses are revenue in nature, and not capital.Expenses are solely incurred in the production of income.They must meet all the following conditions: Deductible expensesīusiness expenses are considered deductible if they are ‘wholly and exclusively incurred in the production of income’. When they are considered deductible, they can reduce the amount of tax that you are required to pay. A few examples of this are the Central Provident Fund (CPF) contributions, salaries, building renovations, paid advertising, and so much more.īusiness expenses can be either tax-deductible or not. Business expensesĪny expense incurred to operate your business is considered a business expense. In this article, we will help you identify which of your business expenses are deductible according to Singapore tax laws. However, determining whether an expense is deductible or not is not always straightforward. One of the many aspects you can look at is business expenses. Maximising tax deductions is one of the many goals that your business will do well to achieve. ![]()
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