Productivity and Innovation Credit (PIC) is a great system that is created by Inland Revenue Authority of Singapore (IRAS). This system is very popular among many business owners in this country. If you are a business owner, you may want to learn about how the PIC scheme works. There are some important things that you should know about this scheme. By learning about these items, you should be able to understand the whole system of the PIC scheme. This system is created to encourage all businesses to invest on the productivity and innovation system.
Who Can Get Benefits from PIC Scheme?
Many people want to know about this scheme. This is reasonable because PIC scheme has a lot of benefits for all business owners. This system is mainly created for all small and medium enterprises in Singapore. All businesses are able to get benefits by getting the cash payout and also tax deduction. If you want to improve your business performance and profit, you may want to learn about this PIC scheme and its benefits. You should know that not all businesses are able to get benefits from this system. There are some activities that are specially covered under this scheme.
Top Activities Covered Under This PIC Scheme
There are top 6 activities that are going to be covered by this scheme, including leasing of the PIC automation equipment, intellectual property acquisition, research and development, intellectual property registration, employees training, and also approved design project. In order to check these activities, you are able to visit the official website of the IRAS Singapore. There are some important information that you can read from this official site. You should be able to find some activities that may be related with the PIC system. If you want to know how to get benefits from this system, you should learn more about some business types that can go well with this scheme.
Benefits for All Business Owners
There are many benefits that are offered by this scheme. Because of these benefits, you should learn about this scheme, so you can improve your profit significantly. Here are two main options that are offered by the IRAS Singapore for all business owners in this country. You should choose the best package that is suitable for your needs.
IRAS PIC Grow SME in Singapore
1. Tax deduction
The PIC system allows you to have up to 400% tax deduction on your expenditure from all eligible activities. This deduction is able to cover up to $400,000 expenditure per year for every activity. You need to read the detailed information about this tax deduction from the official site of IRAS. This tax deduction is very useful to help all business owners reduce the total amount of tax that they are going to pay to the Singapore government.
2. Cash Payout
This is another option that is available for all business owners. You are allowed to convert your expenditure of up to $100,000 from all activities per year of assessment (YAs). All converted expenditure is not tax deductible. You should also know that the cash payout system is non-taxable. In order to get this option, you have to hire at least 3 local Singapore employees. The employees should have Singapore citizens or PRs. The current business should have operations in Singapore.
How to Claim PIC scheme?
a. Tax Deduction
It is not a difficult thing to claim for the tax deduction or cash payout option. You are able to claim the tax deduction to get tax return from your income. All companies should submit the income tax return before the due date on November, 30. The partnership or sole proprietor should submit the income tax return before the due date on April, 15.
b. Cash Payout
Before you can claim for this option, you need to download the PIC cash payout application form. This form is available on the IRAS website. There are some guidelines on how you can fill out this application form. Don’t forget to submit the form before the due date.
They are some important information that you should learn about PIC grants scheme. This scheme becomes very important for all business owners. Your company can get a lot of benefits from this system. It is specially created to help all business owners develop their businesses easily. Visit the official site of the IRAS Singapore to learn more about this system.
How it works