Proposed To provide support for companies’ cash flow needs, a CIT Rebate of 50% of tax payable will be granted in YA 2025.
Companies that are active and have employed at least one local employee in Calendar Year (CY) 2024 (referred to as the “local employee condition”) will receive a minimum benefit of $2,000 in the form of a CIT Rebate Cash Grant.
The total maximum benefits (i.e., sum of CIT Rebate and CIT Rebate Cash Grant) that a company can receive is $40,000. Eligible companies will automatically receive the benefits from the second quarter of CY 2025 onwards.
A company is considered to have met the local employee condition if it has made Central Provident Fund (CPF) contributions to at least one local (i.e., Singapore Citizen or Permanent Resident) employee, excluding shareholders who are also directors of the company, in CY 2024.
For example, Company A hired 2 local employees in CY 2024. It has a tax payable of $30,000 for YA 2025. Company A will receive a $2,000 CIT Rebate Cash Grant and another $13,000 [(50% × $30,000) − $2,000] in CIT Rebate.
Current Companies are allowed tax deduction for treasury shares or previously issued shares of the company or the holding company that are transferred to employees under EEBR schemes.
Proposed
Companies will be allowed to claim a tax deduction on payments to the holding company or a special purpose vehicle (SPV) for the issuance of new shares of the holding company under EEBR schemes.
The deduction will be the lower of:
less any amount payable by employees for the shares.
The changes will take effect from YA 2026.
IRAS will provide further details by the third quarter of 2025.
Current Payments made under a CSA for innovation activities that do not meet the definition of “research and development” under section 2 of the ITA are not deductible. For the purposes of this tax deduction, CSAs are agreements or arrangements made by 2 or more persons to share the expenditure of innovation activities to be carried out under the agreements or arrangements.
Proposed
To support collaborative innovation activities, a 100% tax deduction for payments made by companies under an approved CSA for innovation activities will be introduced with effect from 19 February 2025.
EDB will provide further details by the second quarter of 2025.
Proposed To encourage companies to raise public capital and grow their economic activities in Singapore, qualifying entities may apply for a 10% or 20% Listing CIT Rebate. Refer to Table 1 for more details.
Table 1: Listing CIT Rebate for New Corporate Listings in Singapore
| Parameter | Details |
|---|---|
| Qualifying Entities | |
| Companies and registered business trusts (RBTs) that are tax residents in Singapore. | |
| Tax Benefit | Primary listings: 20% CIT rebate. |
Secondary listings (with share issuance): 10% CIT rebate.
Subject to rebate cap of:
a) $6 million per YA for qualifying entities with market capitalisation of at least $1 billion, or
b) $3 million per YA for qualifying entities with market capitalisation of less than $1 billion. | | Minimum Criteria | Achieve a primary or secondary (with share issuance) listing on a Singapore exchange and remain listed for 5 years.
Commit to incremental local business spending or fixed asset investments, and incremental skilled employment by the end of the award tenure. | | Award Tenure | 5 years per qualifying entity, non-renewable. | | Scheme Duration | Open for award until 31 December 2027. | | Administering Agency | Interested entities can approach the Singapore Economic Development Board (EDB) or Enterprise Singapore (EnterpriseSG) to enquire for more details. |
Proposed To support the ownership and management of ships and sea-containers from Singapore, the ASFA Award will be introduced with effect from 19 February 2025 to provide withholding tax (WHT) exemption on interest and related payments made by approved entities to non-resident lenders in respect of qualifying arrangements entered into on or before 31 December 2031 to finance the purchase or construction of ships and containers.
Ship and container lease payments made to non-resident lessors (excluding payments derived from any operation carried on by the non-resident through its permanent establishment in Singapore) under finance lease (FL) agreements for ASFA Award recipients will also be exempted from WHT.
The ASFA Award will be administered by the Maritime and Port Authority of Singapore (MPA).
MPA will provide further details by the second quarter of 2025.
Current Businesses are allowed a tax deduction of 200% on qualifying market expansion and investment development expenses under the DTDi scheme.
The scheme is scheduled to lapse after 31 December 2025.
Proposed To continue supporting businesses in their internationalisation efforts, the DTDi scheme will be extended till 31 December 2030.
EnterpriseSG will provide further details by the second quarter of 2025.
Current The M&A scheme allows a Singapore company that makes a qualifying acquisition of the ordinary shares of another company to claim the following tax benefits, subject to conditions:
The scheme is scheduled to lapse after 31 December 2025.
Proposed To continue supporting companies to grow through M&A, the scheme will be extended till 31 December 2030.
Current Section 13W of the Income Tax Act 1947 (ITA) provides that gains derived from the disposal of ordinary shares by companies will not be taxed if:
Proposed
The sunset date under section 13W will be removed and the following enhancements will be made:
These changes will take effect for disposal gains derived on or after 1 January 2026.
The Inland Revenue Authority of Singapore (IRAS) will provide further details by the third quarter of 2025.
Current The LIA scheme grants an approved recipient:
At least 80% of the gross floor area of the qualifying building must be used by the approved recipient or its related users. To be considered related, the users must have at least 75% of their shareholdings held in common (or have entitlement to at least 75% of the income in the case of a partnership), whether directly or indirectly.
The scheme is scheduled to lapse after 31 December 2025.
Proposed To continue encouraging businesses to intensify their land use, the LIA scheme will be extended till 31 December 2030.
The shareholding requirement for building users to be considered as related will be lowered from “at least 75%” to “more than 50%”. This change will apply to LIA applications made from 1 January 2026.
The Building and Construction Authority and EDB will provide further details by the third quarter of 2025.
Current Approved insurers and insurance brokers are granted a concessionary tax rate (CTR) of 10% on the relevant qualifying income under the IBD, IBD-Captive Insurance (IBD-CI) and IBD-Insurance Broking Business (IBD-IBB) schemes.
The IBD and IBD-CI schemes are scheduled to lapse after 31 December 2025.
Proposed To continue supporting Singapore’s value proposition as an Asian insurance and reinsurance centre, the IBD and IBD-CI schemes will be extended till 31 December 2030.
Further, an additional CTR tier of 15% will be introduced with effect from 19 February 2025 for the IBD, IBD-CI and IBD-IBB schemes.
The Monetary Authority of Singapore (MAS) will provide further details by the second quarter of 2025.
Current The tax incentives for Project and Infrastructure Finance include:
These incentives are scheduled to lapse after 31 December 2025.
Proposed The QPDS scheme will be allowed to lapse after 31 December 2025.
Project bond investors can continue to avail themselves of tax incentives for debt securities such as the Qualifying Debt Securities (QDS) scheme, if the debt securities qualify as QDS and the conditions of the QDS scheme are satisfied. Investors of QPDS issued on or before 31 December 2025 will continue to enjoy the tax benefits under the QPDS scheme for the remaining life of the issue of the securities, if the conditions of the QPDS scheme are satisfied.
To support Singapore-based infrastructure project sponsors that leverage Singapore’s financial ecosystem to invest in and finance overseas infrastructure projects, the tax incentive under (b) will be extended till 31 December 2030.
Current Approved incentive recipients are eligible for a CTR of 10% or 13.5% on qualifying income (where applicable) under the FSI scheme.
Proposed An additional CTR tier of 15% will be introduced with effect from 19 February 2025 for the FSI-Standard Tier, FSI-Trustee Company and FSI-Headquarter Services schemes.
MAS will provide further details by the second quarter of 2025.
Current Approved incentive recipients are granted a CTR of 10% on relevant qualifying income under the FSI-Fund Management (FSI-FM) scheme.
Proposed To enhance Singapore’s value proposition to fund managers seeking to scale up their activities via public fundraising and grow their investment activities in Singapore, an enhanced CTR tier of 5% will be introduced under the FSI-FM for newly listed fund managers. Refer to Table 2 for more details.
Table 2: Enhanced CTR for New Fund Manager Listings in Singapore
| --- | --- |
Current Approved incentive recipients are currently not granted any corporate tax exemption under the FSI-FM scheme.
Proposed To support fund managers to launch and manage qualifying funds that invest substantially in Singapore-listed equities, a corporate tax exemption on income arising from such funds will be introduced under the FSI-FM. Refer to Table 3 for more details.
Table 3: Tax Exemption on Fund Managers’ Qualifying Income Arising from Funds Investing Substantially in Singapore-Listed Equities
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Current The following income tax concessions are granted to S-REITs and their investors:
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