NOTE: PIC Cash Bonus deadline is till YA2015, worth a total of $15,000 per company, and the qualifying expenditure incurred must be at least $5,000.
Do you know that there is a possibility of reaching almost $0 net cash impact using both the PIC Tax Deduction and various grants available while achieving a boost in your productivity?
To encourage companies to raise their productivity, the Singapore government had offered to extend IRAS PIC Tax Deduction till YA2018. Out of the 6 qualifying activities, ERP System is one of that which is categorized under the Acquisition of IT and automation equipment. For companies with profit, you should be looking at PIC 400% Tax Deduction/allowance, which is increased up to $600,000 expenditure per year. For companies who have no profit left to enjoy the PIC 400% Tax Deduction, there is still another option which is the 60% Cash Payout, capped at $100,000 expenditure.
Example if an ERP software cost you $100,000 qualifying PIC expenditure, you can deduct $400,000 from your taxable and for simplicity reason, we will take 17% as the overall corporate tax and that means you will save about $68,000 tax payment and thus, your estimated net cash impact will be around $32,000. thereafter you can continue to tap on the PIC Cash Bonus of $15,000 and hence, the net cash impact will further be reduced to $17,000.
In addition, depending on which industry you are from, there is IDA iSprint or BCA PIP grant available for application before the net figure can proceed with PIC Tax Deduction.
If you wish to see which part of the IT automation system such as the hardware and/or ERP can qualify for the PIC and which grants are eligible for your company possibly, please feel free to email us at firstname.lastname@example.org and we will arrange for a Consultant to speak with you in further details.