To boost the productivity and innovative entrepreneurship on Singapore’s soil, the Inland Revenue Authority of Singapore (IRAS) introduced Productivity and Innovation Credit (PIC) scheme on the annual budget, 2010. Systematic way of running and innovative mind are two very basic things a company or business needs to overcome mitigations and to lead the market race. The PIC scheme was amended to improve the effectiveness and to enhance competitiveness in the free market capital. By setting the goal to improve the production quality, IRAS encouraged all businesses to take advantage of PIC Scheme by investing in a range of qualifying activities. According to the PIC scheme, eligible companies will receive 100% matching cash bonus on spending of a minimum of $5,000 on qualifying activities in a Year of Assessment (YA). The most positive aspect of PIC scheme is 400% tax deductibility on qualifying expenses.
A lot of prospective clients of PIC scheme had a serious doubt that whether software can be claimed under the PIC scheme in terms of the price or training cost, or not. But surely the clients are now assured about the benefit as IRAS explained that the software as well as hardware, both are covered under the PIC scheme and also can be claimed. For further information, in 2013, the Government of Singapore made this PIC scheme for software more liberal and the term ‘automation equipment’ has been changed to ‘IT and automation equipment’ to reflect the fact that PIC scheme already supports IT-related software besides automation equipment.
The qualifying activities for businesses to be eligible for PIC scheme or PIC+ scheme, includes purchase of IT products such as software and also training for employees. If any company need to send their employee for training purpose with the purchased software and to have hand on experience, the course fee spent, can be rightfully claimed under the PIC scheme and the cost will be reimbursed.