Singapore Includes Cloud Computing In Tax Incentives,
by Mary Swire, Tax-News.com, Hong Kong
Wednesday, October 26, 2011
At a recent forum, Singapore’s Infocomm Development Authority confirmed
that businesses will, through the inclusion of related costs under the Productivity
and Innovation Credit (PIC) scheme, be able to obtain significant tax benefits
for cloud computing.
Introduced last year and improved in the 2011/12 Budget, the PIC provides businesses
with tax benefits for investing in a broad range of productivity improvement
and innovation activities.
The amount of tax deduction or allowance was increased to 400% for the first
SGD400,000 (USD317,000) of research and development (R&D) expenditure, and
businesses are also allowed to combine that annual expenditure cap for 2013
to 2015 into a new ceiling of SGD1.2m over the three years.
There is also an enhanced cash conversion option where taxpayers can opt to
receive, in lieu of tax deduction benefits, a cash payout of 30% of the first
SGD100,000 of qualifying expenditure (a maximum of SGD30,000).
Singaporean businesses, including small- and medium-sized enterprises, can
now, therefore, claim for their cloud computing expenditure, within certain
categories such as the acquisition or leasing of technological equipment, training
expenditure, the acquisition and registration of intellectual property rights,
actual costs of research and development, and costs incurred in the creation
of new products and industrial designs.
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