Question on Tax, specifically PIC Bonus

[weap0nx]

Hello,

it's tax season, or rather was, and I'm still wondering about the PIC particularly because this year there is a dollar for dollar bonus.

There is no outright metion that an e-commerce software qualifies as automation equipment but it almost exactly matches item number 4 on the list.
Here is what item number 4 states:

"Information technology software including office
system software and software used in
connection with provision of any office
automation service, enterprise resource
planning, customer relationship management
such as reservations, registration, queue
management, ordering, billings and collections,
inventory management, record management,
knowledge management, human resource and
payroll management, financial information and
business management such as accounting and
assets management, and personnel business
travel request, information and management"

Underlined are the functions that the customized e-commerce software
purchased is able to perform. Am I allowed to claim? It is a huge sum in excess of $10,000.

 

[Epps_Sg]

Hi. Let's say your e-commerce software cost $10,000. You can get 60% cashback which is $6,000 at end of this quarter. If you bought software within 2013, you get $10,000 PIC Bonus Credit also (PIC Bonus maximum total is $15,000 from 2013 to 2015). claiming for $10,000 plus is not a lot... you can claim 60% back for up to $100,000. Beyond that amount, you can claim up to 400% tax deduction (equivalent to 68% cash back). Don't forget you can claim cashback for in-house and external training under PIC also, and for computers, tablets etc bought under company name.

In summary, for your case you spend $10,000 on the e-commerce software this year, you get back $16,000 cash...

Please verify what I said with the PIC people first:
-Email address: picredit@iras.gov.sg
-Call from 8 am to 5 pm from Mondays to Fridays:
For companies: 1800-356 8622
For self-employed/partnership: (+65) 6351 3534

Summary of PIC:
PIC allows local SMEs to get 60% cash back for up to $100,000 qualified expenditure per year, or 400% tax deduction from YA2013 to YA2015. (30% cashback if from YA2011 to YA2012)

Some more info on Productivity Improvement Credit (PIC):
PIC Seminar PowerPoint (click here)
PIC website (click here)
Qualified IT and Automation Equipment/Software for PIC(click here)


Singapore govt. is giving money to local companies for buying IT/productivity equipment/software, the govt. also giving Singapore free MRT rides in the morning costing estimated $10 million - is this start of Singapore's 'Quantitative Easing'?

 

[chopra]

I think so. !

 

[lzydata]

Singapore govt. is giving money to local companies for buying IT/productivity equipment/software, the govt. also giving Singapore free MRT rides in the morning costing estimated $10 million - is this start of Singapore's 'Quantitative Easing'?

In the budget the government said the PIC Bonus will cost $450m over 3 years. The morning free rides, as a percentage of this or other initiatives, is really spare change in comparison

 

[weap0nx]

Thanks guys, couldn't have asked for better answers

 

[IronMac]

Sorry for a potential n00b question but would this apply to registered self-employed businesses?

 

[Raider04]

Sorry for a potential n00b question but would this apply to registered self-employed businesses?

Yes it's applicable.

 

[Epps_Sg]

Sorry for a potential n00b question but would this apply to registered self-employed businesses?

Need to fulfil belwo conditions also:

Spoiler

Conditions for PIC Bonus
Incurs at least $5,000 of PIC-qualifying expenditure^ for each
YA in respect of which a PIC Bonus is claimed
Employed at least 3 local employees* (Singapore Citizens or PRs
© 2013 IRAS Singapore
with CPF contributions) in the last month of the relevant period
(last month of basis period of relevant YA or last month of
quarter or combined consecutive quarters)
Carrying on business operations in Singapore
19
^ Net of grant or subsidy by the Government or statutory board
* Employees exclude sole-proprietors, partners under contract for service, shareholders
who are also directors of companies

Best to call the PIC office to confirm - see contact number in post #2.

 

[IronMac]

Thanks Raider and Epps; I did not look hard enough.