Tax Deductible Expenses For Your Singapore Company

In the course of running the business, there are certain tax-deductible expenses incurred that you can offset against your company’s taxable income.

Of course, having said that, not all business expenses are tax-deductible. It is essential that you or whoever is in charge of the preparation of the company’s tax returns are aware of what expenses can be eligible.

All 4 conditions listed below must be fulfilled for expenses to be eligible for tax deductions:

  1. Expenses incurred in the process of income-producing activities.
  2. The expenses must have already been incurred, meaning the expenses cannot be some form of future projection.
  3. Expenses are not capital in nature, but revenue in nature.
  4. Under the Income Tax Act, the expenses are not prohibited from deduction.

We have a list here of examples of what exactly is a deductible or non-deductible expense.

Deductible Expenses:

  • Accounting fee
  • Administrative expenses
  • Advertisement
  • Auditor’s remuneration
  • Bad debts (trade debtors)
  • Bank charges
  • Commissions
  • Salary
  • Director’s fees
  • Director’s remuneration
  • Exhibition expenses
  • Office upkeep
  • Periodicals & newspapers
  • Postage
  • Printing and stationery
  • Property tax
  • Rental of a business premise
  • Registration of patents and trademarks
  • Research and development
  • Retrenchment payments where the business still continue to operate
  • Secretarial fees
  • Staff remunerations (salary, bonus, and allowances)
  • Telephone and internet bills
  • Transportation
  • Utilities

Non-Deductible Expenses

  • Amortisation
  • Bad debts (non-trade debtors)
  • Country club fees
  • Personal vehicle expenses
  • Depreciation (you can claim capital allowances instead)
  • Dividend payments made on preference shares
  • Donations
  • Exchange loss (non-trade or capital in nature)
  • Fines
  • Fixed assets acquisition cost (you can claim capital allowances instead)
  • Goodwill payment
  • Installation of fixed assets
  • Penalties
  • Renovation or refurbishment works
  • Retrenchment payments where the business has ceased operating completely

This list is non-exhaustive but rather give you a guide on what type of expenses are eligible for tax deductions.

In general, personal expenses that are not related to the business such as your daily meal expenses, and fixed assets purchase expenses are all non-deductible for tax purposes.

If you require assistance in your corporate tax filing, please do not hesitate to get in touch with us today!


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