Breaking Down the Tax Reliefs Available to Singapore Businesses
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- 4 min read
19 November 2025
Editor: ET
Singapore is widely known for its pro-business tax framework, making it a top destination for entrepreneurs, SMEs, and international corporations. One of the biggest advantages of operating here is the wide range of tax reliefs available to Singapore businesses, designed to lower operational costs, encourage innovation, and support long-term growth.
Whether you're a newly incorporated start-up or a growing enterprise, understanding these tax benefits helps you maximise savings while staying fully compliant. At Expede Tech Pte Ltd, we guide businesses through Singapore’s tax ecosystem to ensure every eligible incentive, rebate, or relief is properly applied.
This guide breaks down the core tax reliefs available to Singapore businesses, how they work, and how they can strategically benefit your operations.
Further Reading:Â The Key Benefits of Incorporating Your Business in Singapore
Why Understanding Tax Reliefs Matters for Singapore Businesses
For many entrepreneurs, taxes can be overwhelming. However, Singapore’s tax system is intentionally designed to be business-friendly. By knowing what tax reliefs are available to Singapore businesses, you not only reduce your payable tax but also improve cash flow, strengthen working capital, and accelerate expansion plans.
From start-up exemptions to R&D deductions, Singapore offers numerous incentives that can significantly reduce your tax burden if used correctly.
1. Start-Up Tax Exemption (SUTE) Scheme
One of the most attractive tax reliefs available to Singapore businesses—especially for new entrepreneurs—is the Start-Up Tax Exemption (SUTE).
Eligible companies can enjoy substantial exemptions in their first three years of assessment:
75% exemption on the first $100,000 of normal chargeable income
50% exemption on the next $100,000
To qualify, companies must:
Be incorporated in Singapore
Be a tax resident
Have no more than 20 individual shareholders
This relief significantly reduces the tax burden for new companies, making it easier to reinvest profits back into operations.
2. Partial Tax Exemption (PTE) Scheme
After the SUTE period, companies automatically transition to the Partial Tax Exemption (PTE)Â scheme.
Under PTE, businesses can receive:
75% exemption on the first $10,000 of chargeable income
50% exemption on the next $190,000
This scheme ensures that even mature businesses continue to benefit from reduced tax obligations.
3. Corporate Income Tax (CIT) Rebates
In some years, the Singapore government gives Corporate Income Tax (CIT) rebates to support businesses during fluctuations in global economic conditions. These rebates vary by year, depending on national fiscal priorities.
Although not permanent, these rebates provide an immediate reduction in tax payable whenever they are announced.
4. Research & Development (R&D) Tax Deductions
Innovation is a core driver of Singapore’s economic growth, and the government supports this through substantial R&D tax incentives.
Under the Enhanced R&D Tax Deduction Scheme, businesses can claim:
Up to 400% tax deduction for qualifying R&D activities conducted in Singapore
Qualifying expenditure includes staff costs, consumables, and R&D project overheads
Companies can also benefit from the Pioneer Certificate Incentive (PC)Â and Development and Expansion Incentive (DEI)Â if they engage in high-value activities such as advanced manufacturing or technology development.
5. Capital Allowances for Fixed Assets
Instead of claiming depreciation (which is not tax-deductible in Singapore), companies can claim capital allowancesfor fixed assets used in business operations. These may include:
Machinery
Office equipment
Computers & IT systems
Vehicles used for business
The capital allowance framework helps businesses offset the cost of acquiring productive assets.
6. Employment-Related Tax Reliefs
Singapore provides several tax benefits to companies investing in local talent development or staff welfare. These include:
SkillsFuture Enterprise Credit (SFEC)
Businesses receive support when investing in employee upskilling initiatives.
Double Tax Deduction for Internationalisation (DTDi)
Companies can claim 200% tax deduction on eligible expenses for overseas expansion, such as:
Market research
Trade fairs
Overseas marketing trips
This relief makes Singapore an ideal base for regional growth.
7. Loss Carry-Back and Carry-Forward Reliefs
Companies that incur business losses can apply the following reliefs:
Carry-Back Relief
Businesses may carry back unutilised losses, donations, and capital allowances to the previous year—reducing prior tax liabilities.
Carry-Forward Relief
Unutilised losses and allowances can be carried forward indefinitely, as long as the shareholding test is met.
These reliefs help stabilise cash flow during unpredictable years.
8. GST Schemes for Businesses
Singapore offers several GST-related schemes that help reduce cash-flow strain, including:
Major Exporter Scheme (MES)
Allows approved businesses to import goods without upfront GST payments.
Gross Margin Scheme
Useful for second-hand goods businesses.
Import GST Deferment Scheme (IGDS)
Businesses defer GST payment until the monthly GST return is filed.
These GST reliefs are especially beneficial for companies in trading, logistics, and wholesale distribution.
Conclusion: Leverage Tax Reliefs to Strengthen Your Singapore Business
Singapore’s tax framework is carefully designed to support innovation, business resilience, and long-term growth. By understanding the full range of tax reliefs available to Singapore businesses, you can significantly reduce taxable income, optimise operations, and reinvest more efficiently.
At Expede Tech Pte Ltd, we help companies navigate these tax incentives, ensuring compliance while maximising benefits. With professional guidance, your business can take full advantage of Singapore’s world-class tax ecosystem.
