The Productivity and Innovation Credit ("PIC") scheme is a scheme that supports investments in innovation and productivity. It provides tax benefits on investments made by businesses in six productivity improvement activities: * Acquisition of leasing of PIC automation equipment; * Training of employees; * Acquisition of intellectual property rights; * Registration of patents, trademarks, designs and plant varieties; * Research and development activities; and * Investment in approved design projects. Under the PIC scheme, all business can enjoy tax deduction/allowances at 400% on up to $400,000 of their expenditure per year on each of the six qualifying activities mentioned above. In addition, businesses can also exercise an option to convert their expenditure into a non-taxable cash payout. You are encourage to find out more about how the PIC scheme can support your business as you innovate and improve your business' productivity. Should you have any queries on PIC scheme, please contact IRAS at 1800-356-8622 or email to picredit@iras.gov.sg

1. 6 ways to boost
your tax savings
with Productivity &
Innovation Credit (PIC)

2. What is PIC?
The PIC scheme supports investments in
Innovation and Productivity. Businesses
can enjoy huge tax savings in the form of
Cash Payout and/or Tax Deduction when
they invest in any of these six productivity
improvement activities:
Training of
Employees
Acquisition
or Leasing of PIC
Registration of Patents, Automation Equipment
Trademarks, Designs
and Plant Varieties
Acquisition of
Intellectual
Property Rights
Investment in Design
Research and
Projects Approved by
Development
the DesignSingapore
Activities
Council

3. How PIC
benefits you?
On your spending for
accounting years 2010 to 2014
[Years of Assessment (YA)
2011 to 2015]
Cash
400% Payout Option
Tax Deduction * Youtocan applyof your total
up $100,000
to convert
* You can enjoy
deduction on
400% tax
up to
spending in all six activities
into a non-taxable cash
$400,000 of your spending
ing payout instead of claiming
each year in each of the tax deduction. This option
six activities. may be more beneficial
for businesses with low or
* This means
deduction of
a tax
up to $1.6
no taxable income.
million ($400,000 x 400%) for
each activity per YA. At * The maximum cash payout
is:
the corporate tax rate of
17%, your tax savings can
be up to $272,000 for each
ach YA 2011 and YA 2012
activity per YA. combined (30% x
combined spending
* In addition, you can
ing
combine your spending
cap of $200,000);
vity
across YAs for each activity
to enjoy the maximum PIC $100,000) for each YA
benefits as follows: from YA 2013 to YA 2015.
2011 20133
YA & 2012 to 2015
15
To qualify for cash payout, your
company must:
Combined $800,000 $1,200,000
00
spending ($400,000 x 2) ($400,000 x 3)
cap per employees (Singapore Citizens
activity or Permanent Residents with
CPF contributions, excluding
Maximum $3.2 million $4.8 million
ion shareholders who are directors
tax of the company); and
($800,000 ($1.2 million
deduction at 400%) at 400%)
per activity Singapore.
Potential $544,000 $816,000
tax savings
@ 17%

4. ly
on d
m e
omlaim
C C Training of
Employees
You can claim PIC benefits on
training costs to upgrade the skills
of your employees.
EXTERNAL TRAINING IN-HOUSE TRAINING
Training of your employees by Training of your employees by
external service providers your in-house trainers
Qualifying Training Costs
Course fees
remuneration paid to
in-house trainers for
conducting the training
In-house training must be:
A Workforce Skills Qualification On-the-job training by an
(WSQ) training course on-the-job training centre
accredited by the Singapore certified by ITE
Workforce Development Agency In-house training not
(WDA) and conducted by a WSQ accredited / certified by
in-house training provider WDA/ITE (with effect from YA
A course approved by the 2012 and subject to spending
Institute of Technical Education cap of $10,000 per YA)*
(ITE) under the ITE Approved * Note: Spontaneous consultation, day-to-day
Training Centre scheme problem-solving or meetings and
coaching/mentoring sessions between
supervisors and subordinates are excluded.

5. ly
on d
m
m ime
Co Cla
PIC Automation
Equipment
You can claim PIC benefits on
costs of acquiring or leasing any
PIC automation equipment used
in your business.
The list of automation equipment qualifying for PIC, called the PIC
Automation Equipment List, is available at www.iras.gov.sg
(Businesses > For companies > Productivity and Innovation Credit).
If the automation equipment is not in the PIC Automation Equipment
List, you may apply to IRAS to have the equipment approved for PIC
on a case-by-case basis. The criteria and application procedure are
available on IRAS website.
Examples from PIC Automation Equipment List:
cutting machine
system
How do I apply?
How to Claim/Apply When to Submit
Claim tax deduction in By the filing due date of
400% Tax
your Income Tax Return 30 Nov or 15 Dec (if you
Deduction (Form C/Form C-S) e-File Form C-S)
Submit PIC Cash Payout Any time after the end of
Application Form your financial quarter(s), but
Cash (www.iras.gov.sg > not later than the filing due
Payout Businesses > For date of the Income Tax
companies > Productivity Return (Form C/Form C-S)
and Innovation Credit)

6. Case Study
Applying for
CASH PAYOUT
Investment in accounting year 2012
Invested in a point of sale (POS) system and
sent your staff for customer service courses
Choose your
benefits
400% Tax
Deduction
Cash Payout
$3 $5
,00 ,00
Company A runs 0 0
a retail outlet
Cash Payout
Calculation
RECEIVE
Total Expenses:
$4,800 $8,000
CASH PAYOUT PIC Cash Payout x 60% = $4,800
Application Form
Apply any time after the end
of your financial quarter(s), but
not later than 30 Nov 2013
Claiming
TAX DEDUCTION
Choose your
benefits
400% Tax
Deduction
BILL Cash Payout
$50,000
Company B is a Investment in accounting year 2012
ounting
manufacturing Invested in Computer Numerical
company Control (CNC) cutting machines
UP TO Tax allowance =
Claim tax
$34,000 allowance in your $200,000
TAX SAVINGS C/C-S
Income Tax ($50,000 x 400%)
Return for YA 2013 YA 2013
based on corporate
tax rate of 17%.
by 30 Nov 2013
For more information on PIC, contact us:
Helpline for Companies: 1800-356 8622 | Email: picredit@iras.gov.sg
Website: www.iras.gov.sg
Businesses > For companies > Productivity and Innovation Credit