Key Tax Incentives Administered by the Economic Development Board and Enterprise Singapore

The Singapore government has established a number of tax incentive programmes to help companies improve efficiency, strengthen capabilities and explore new opportunities in their business. Some programmes cater to the needs of start-ups and local enterprises, while others are designed for global companies carrying out high-value and substantive economic activities in Singapore.

The tax incentives are legislated, and the approving authority is usually vested with statutory bodies such as the Economic Development Board (EDB), Enterprise Singapore (ES), the Monetary Authority of Singapore (MAS), the Singapore Tourism Board (STB), the Building and Construction Authority (BCA), and the Maritime and Port Authority of Singapore (MPA).

The key tax incentives administered by EDB and ES are listed below:

Incentives Table

Business Sector/Activity	Incentive	Tax Relief	Relief Period	Sunset Clause	Qualifying Criteria	Legislation	Administrative Body
Venture Capital	Venture Capital Fund Incentive (VCFI)	Tax exemption on qualifying income Goods and services tax (GST) remission on expenses at a fixed recovery rate Qualifying Income: Dividends derived from outside Singapore and received by the company in Singapore from approved investments in any company not resident in Singapore Interest derived from outside Singapore and received by the company in Singapore in respect of any approved convertible loan stock of a company not resident in Singapore, and Gains or profits derived from Singapore or received by the company in Singapore from outside Singapore from the disposal of any approved investment	Life of the venture capital fund, up to a maximum of 15 years	31 December 2025	The VCFI scheme requires that the fund: Has a minimum fund size of S$10 million Incurs cumulative local business spending (LBS) of at least S$100,000 multiplied by the incentive tenure, to be met by the end of the incentive tenure Invests a certain percentage into unlisted Singapore-based companies by Year 5 of the incentive or by the end of the incentive, whichever is earlier The VCFI scheme accommodates the following legal structures: Limited partnership Company (incorporated in Singapore or elsewhere), and Variable Capital Company (VCC)	Section 13G of the Income Tax Act 1947, Income Tax (Exemption of Income of Approved Venture Company) Regulations	ES
Venture Capital	Fund Management Incentive (FMI)	Concessionary tax rate of 5% on qualifying income derived from managing venture capital funds approved under the VCFI Qualifying Income: Management fees Performance bonuses	Five (5) years, renewable in tranches of up to 5 years	31 December 2025	Fund managers who have obtained the necessary MAS license are eligible to apply for the FMI. The FMI requires that the fund manager: Has a minimum assets under management (AUM) of S$40 million comprising VCFI funds Hires at least one (1) additional investment professional by the end of the FMI award. For renewals, the fund manager must hire at least 1 additional investment professional by the end of the renewal tranche	Section 43V of the ITA	ES
Global Trading	Global Trader Programme	Concessionary tax rate of 5%, 10%, or 15% on qualifying income Qualifying Income Profits from any physical trading carried out by the company in the commodities specified for the company Profits from any trading in any derivative instrument carried out by the company Commission and fees from acting as broker in any physical trading in the commodities specified for the company Income from the carrying on of any prescribed qualifying structured commodity financing activity, prescribed treasury activity or prescribed advisory services in relation to mergers and acquisitions, specified for the company	Five (5) years, renewable in tranches of up to 5 years	31 December 2026	Established companies engaged in international physical trading that are able to commit to the following in Singapore: Conduct significant trading activities Employ skilled professionals Perform strategic functions such as strategic management, compliance and risk management, financial management, and logistics management functions Make significant use of Singapore’s banking and financial services, logistics, arbitration, and other supporting services	Section 43I of the ITA, Income Tax (Concessionary Rate of Tax for Global Trading Companies) Regulations 2016	ES
Treasury Management	Finance and Treasury Centre (FTC) Incentive	Concessionary tax rate of 8% or 10% on income derived from qualifying FTC services to approved network companies (ANCs) and qualifying FTC activities carried out by the FTC on its own account with funds obtained from qualifying sources Withholding tax exemption on interest payments on loans from banks and non-bank financial institutions outside Singapore and loans and deposits from ANCs outside Singapore, where the loans relate to the conduct of qualifying FTC services and activities	Five (5) years, may be renewed in tranches of up to 5 years	31 December 2026	8% Concessionary Tax Rate: For initial award: Carry out any of the FTC activities in Singapore Employ at least Four (4) FTC professionals, all of whom shall be based in Singapore by Year 1, and maintain this until the end of the incentive period Incur annual total business expenditure (TBE) of at least S$1.5 million for the FTC by Year 1, and maintain this until the end of the incentive period For subsequent renewals: Carry out any of the FTC activities in Singapore Employ at least one (1) additional FTC professional by Year 5, all of whom shall be based in Singapore Incur annual total business expenditure (TBE) of at least S$400,000 for the FTC by Year 1, and maintain this until the end of the incentive period 10% Concessionary Tax Rate: For initial award: Carry out any of the FTC activities in Singapore Employ at least three (3) FTC professionals, all of whom shall be based in Singapore by Year 1, and maintain this until the end of the incentive period Incur annual TBE of at least S$1.5 million for the FTC by Year 1, and maintain this until the end of the incentive period For subsequent renewals: Carry out any of the FTC activities in Singapore Employ at least one (1) additional FTC professional by Year 5, all of whom shall be based in Singapore Incur an additional annual TBE of at least S$350,000 by Year 5	Section 43E of the ITA, Income Tax (Concessionary Rate of Tax for Approved Finance and Treasury Centre) Regulations 2017	EDB
Aviation	Aircraft Leasing Scheme (ALS)	Concessionary tax rate of 8% or 10% on income derived from the leasing of aircraft or aircraft engine and qualifying ancillary activities Withholding tax exemption on interest and qualifying related payments on loans obtained for the purchase of aircraft or aircraft engines Irrevocable election to depreciate the aircraft over any number of years from five (5) to 20 years	Five (5) years, may be renewed in tranches of up to 5 years	31 December 2027	8% Concessionary Tax Rate: For initial award: Employ at least five (5) additional skilled employees, all of whom shall be based in Singapore, by Year 5 Incur annual total business spending (TBS) of at least S$15 million by Year 5 For subsequent renewals: Employ at least one (1) additional skilled employee, all of whom shall be based in Singapore, by Year 5 Incur annual TBS of at least S$17 million by Year 5 10% Concessionary Tax Rate For initial award: Employ at least five (5) additional skilled employees, all of whom shall be based in Singapore, by Year 5 Incur annual TBS of at least S$13.5 million by Year 5 For subsequent renewals: Employ at least one (1) additional skilled employee, all of whom shall be based in Singapore, by Year 5 Incur annual TBS of at least S$15.5 million by Year 5	Section 43N of the ITA, Income Tax (Concessionary Rate of Tax for Aircraft Leasing Company) (Prescribed Activities) Regulations 2008, Income Tax (Concessionary Rate of Tax on Dividends — Aircraft Leasing Company) Order 2020	EDB
Aviation	Aircraft Investment Manager (AIM) Incentive	Concessionary tax rate of 10% on income arising from qualifying activities: Managing an approved aircraft leasing company and approved special purpose companies, and Provision of investment advisory services for and to an approved aircraft leasing company	Five (5) years	31 December 2027	The AIM is awarded as a tie-in with ALS, therefore only companies that will be managing or providing investment advisory services to an approved aircraft leasing company applying for or having an existing ALS may apply	Section 43O of the ITA, Income Tax (Concessionary Rate of Tax for Aircraft Investment Manager) (Prescribed Activities) Regulations 2008	EDB
Research and Development	Intellectual Property Development Incentive (IDI)	Concessionary tax rate on a percentage of qualifying Intellectual Property (IP) income derived during the incentive period Concessionary tax rate offered will correspond to the primary incentive which the entity is enjoying or applying for: Pioneer Service Incentive: 5% Development and Expansion Incentive (including Headquarters) – 5%: 5% Development and Expansion Incentive (including Headquarters) – 10%: 10% Qualifying intellectual property income refers to royalties or other income receivable by the approved company as consideration for the commercial exploitation of an elected qualifying intellectual property right	10 years, may be renewed in tranches of up to 10 years	31 December 2028	5% Concessionary Tax Tate (Standalone Award) For every five (5)-year qualifying period: Employ at least 20 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$10.5 million by Year 5 10% Concessionary Tax Rate (Standalone Award) For every 5-year qualifying period: Employ at least 20 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$7 million by Year 5.	Section 43X of the ITA, Income Tax (Concessionary Rate of Tax for Intellectual Property Income) Regulations 2021	EDB
Research and Development	Approved Royalties Incentive	Tax exemption or concessionary withholding tax rate on approved royalties, technical assistance fees, or contributions to research and development costs	As specified in the approval certificate	31 December 2028	Company must enter into, or desire to enter into, an agreement or arrangement with a non‑resident person for the purposes of carrying on an approved activity under which royalties or technical assistance fees or contributions to research and development costs are or will be payable to the non‑resident person	Part 7 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967 (EEIA)	EDB
Growth	Pioneer Certificate Incentive — Pioneer Industries (Manufacturing)	Tax exemption on income derived from the manufacturing of the pioneer product(s)	Five (5) years, up to a maximum of 15 years	31 December 2028	Company must: Incur additional Fixed Asset Investment (FAI) of at least S$44 million by Year 5 Employ at least 30 additional skilled employees, all of whom shall be based in Singapore by Year 5	Part 2 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967	EDB
Growth	Pioneer Certificate Incentive — Pioneer Service Companies	Tax exemption on income derived from qualifying activities: Engineering or technical services including laboratory, consultancy and research and development activities Computer-based information and other computer related services The development or production of any industrial design, and Such other services or activities as may be prescribed	Five (5) years, up to a maximum of 15 years	31 December 2028	Company must engage in, or desire to engage in, one or more qualifying activities	Part 3 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967, Expansion Incentives (Relief from Income Tax)(Qualifying Activity) Regulations, Economic Expansion Incentives (Relief from Income Tax) (Intellectual Property Income) Regulations 2018	EDB
Growth	Development and Expansion Incentive (DEI) for Manufacturing	Concessionary tax rate of 5%, 10%, or 15% on income over base income Qualifying income refers to income derived from qualifying manufacturing activities undertaken in Singapore The base income is the average income from qualifying activities of the entity for the 36 months immediately preceding the DEI	Five (5) years, may be renewed in tranches of up to 5 years, up to a maximum of 40 years	31 December 2028	5% Concessionary Tax Rate For every five (5)-year qualifying period: Incur additional FAI of at least S$13 million by Year 5 Employ at least 30 additional skilled employees, all of whom shall be based in Singapore by Year 5 10% Concessionary Tax Rate For every 5-year qualifying period: Incur additional FAI of at least S$7 million by Year 5 Employ at least 20 additional skilled employees, all of whom shall be based in Singapore by Year 5 15% Concessionary Tax Rate For every 5-year qualifying period: Incur additional FAI of at least S$5 million by Year 5 Employ at least 13 additional skilled employees, all of whom shall be based in Singapore by Year 5	Part 4 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967	EDB
Growth	DEI for Services	Concessionary tax rate of 5%, 10% or 15% on qualifying income in excess of the base income Qualifying income refers to income derived from qualifying services or activities (excluding headquarters and manufacturing activities) undertaken in Singapore The base income is the average income from qualifying activities of the entity for the 36 months immediately preceding the DEI	Five (5) years, may be renewed in tranches of up to 5 years, up to a maximum of 40 years	31 December 2028	5% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one service activity Employ at least 18 additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$8 million by Year 3 Employ at least 30 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$13 million by Year 5 10% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one service activity Employ at least 15 additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$5.5 million by Year 3 Employ at least 25 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$9 million by Year 5 15% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one service activity Employ at least eight (8) additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$3 million by Year 3 Employ at least 13 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$5 million by Year 5	Part 4 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967, Economic Expansion Incentives (Relief from Income Tax) (Qualifying Activity) Regulations, Economic Expansion Incentives (Relief from Income Tax) (Intellectual Property Income) Regulations 2018	EDB
Headquarters	Development and Expansion Incentive (DEI) for Manufacturing — International Headquarters Award	Concessionary tax rate of 5%, 10% or 15% on qualifying income in excess of the base income Qualifying Activities: Management, coordination and control functions of business activities for the group Sourcing and procurement Supply chain managementp Marketing control and planning Human resource management Provision of legal services Provision of finance services Provision of brand management services	Five (5) years	31 December 2028	5% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one (1) of the headquarters activities in Singapore Employ at least 18 additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$8 million by Year 3 Employ at least 30 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$13 million by Year 5. 10% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one of the headquarters activities in Singapore Employ at least 15 additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$5.5 million by Year 3 Employ at least 25 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$9 million by Year 5 15% Concessionary Tax Rate For every five (5)-year qualifying period: Carry out at least one (1) of the headquarters activities in Singapore Employ at least eight (8) additional skilled employees, all of whom shall be based in Singapore by Year 3 Incur additional annual TBE of at least S$3 million by Year 3 Employ at least 13 additional skilled employees, all of whom shall be based in Singapore by Year 5 Incur additional annual TBE of at least S$5 million by Year 5	Part 4 of the Economic Expansion Incentives (Relief from Income Tax) Act 1967	EDB
Productive Equipment	Approved Foreign Loan Scheme	Tax exemption or concessionary withholding tax rate on interest payments made to a non-resident for loans to a company to purchase productive equipment	As specified in the approval certificate	31 December 2028	Company must obtain, or desire to obtain, a loan of not less than $20 million from a non‑resident person by means of an agreement under which credit facilities are granted for the purchase of productive equipment for the purposes of its trade or business	Part 6 of the Economic Expansion Incentives (Relief from Income Tax) Act 196 (EEIA)	EDB
Productive Equipment	Investment Allowance for Emissions Reduction	Investment allowance of a specified percentage not exceeding 100% of the amount of the fixed capital expenditure incurred on an approved project for reducing greenhouse gas emissions	Five (5) years	31 December 2026	Company must carry out a project that reduces greenhouse gas emissions	Part 8 of the EEIA	EDB
Productive Equipment	Investment Allowance for Automation	100% investment allowance on approved capital expenditure for approved automation projects, capped at S$10 million per project	Five (5) years	31 March 2026	Company must engage in large scale deployment of automation solutions to improve resource efficiency through automation and technology	Part 8 of the EEIA	ES

The information presented in this article is as at 23 October 2024.

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This article should be used as a general guide only. No reader should act solely upon any information found in this article. We recommend that professional advice be sought before taking action on specific issues and making significant business decisions. Crowe Singapore expressly disclaims all and any liability to any person in respect of anything, and of the consequences of anything, done or omitted to be done by any such person in reliance, whether wholly or partially, upon the whole or any part of the contents of the above article. While every effort has been made to ensure the accuracy of the information contained herein, Crowe Singapore shall not be responsible whatsoever for any errors or omissions in it.

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