FAQ

We have answered here some of the Frequently Asked Questions from our valuable customers. We know these are not conclusive and you might have individual questions to ask and get clarified. You need not have any inhibition to shoot those questions, by contacting us at www.picgrant.sg . Our professionals are always ready to answer them to your satisfaction.

1.What are the salient features of PIC Grant Scheme?

Singapore like other nations wants the economic thrust by the commercial businesses big, medium and small. As a welfare measure, they have devised liberal Government Grants under the broad banner of Productivity and Innovation Credit (PIC Grant Scheme).
Through these Government Grants, Small and Medium Enterprises (SME) of Singapore are granted financial help by Cash Incentives, Subsidies and Aids to the qualifying applicants.
These Grants will help these businesses to make investments for equipments and technology upgrades including software installation, so as to increase productivity and efficiency of service for the business as well as the whole nation.

2.Are there other Grants along with PIC Grants?

Yes – with the objective of helping a wide spectrum of Singapore businesses, the Singapore Government has allocated funds from 2010 onwards. The prominent other Cash Subsidies are the Innovation and Capability Voucher (ICV) and the Capability Development Grant (CDG). All these Government Grants work simultaneously and are implemented by Government Agencies like IRAS, assisted by affiliate agencies like Design Singapore Council.

3.Who can avail the benefits of PIC Grant and other Schemes?

Practically any business in Singapore can be benefited, including subsidiaries and branches of international companies in Singapore, even if the parent company is foreign. The eligibility is automatic, if they employ three or more persons as their employees. The term employee applies only to those contributing to CPF payments; and excludes shareholders or directors in the business.

4.How the PIC Grant benefits are available to the qualifying businesses?

Under the PIC Grant Scheme, the qualifying businesses can claim 400% of the qualifying expenditure as tax deduction towards innovation or 60% subsidy of the total qualifying expenditure as Cash Payout aid. You can get exact details in your individual case by contacting PICGrant.sg experts.

1.How the Qualifying Expenditure is classified?

There are 6 categories of expenses that are deemed as Qualifying Expenditure in businesses, for availing PIC Grant. Here again you can get your case analyzed by our experts, to advise you what are the categories and under what category your business becomes eligible.

1.How about Investment Holdings? Are they eligible for PIC Grant?

No – these Investment Holding companies do not come under the classification of business for the purpose of taxation, nor do they conduct any trade. These companies invest capital in other business enterprises with a profit motive, to derive rental, interest or dividend income.

1.Is it necessary to send separate application to IRAS requesting them to consider the business equipments and technology solutions adopted in our business as eligible IT and automation devices, as prescribed by PIC Grant Scheme?

No separate application is needed. The IRAS has categorically prescribed the list of equipments for innovation under PIC Grant Scheme. You need to check this list and if the equipments fall under this list, then a regular PIC Claim Application need to be submitted. Our experts can help you in this regard if you approach.

2.In the event of our automation equipment not falling under the prescribed list, can we opt for Cash Payout processing straight away?

No – the procedure is otherwise. You are advised to submit an appeal to IRAS and explain the reasons for considering the automation equipments as bona fide, to request for their approval. If your appeal gets negated by IRAS for valid reasons, then you can opt for Cash Payout aid, again with the approval of IRAS.

3.What is meant by Cash Payout?

Under the PIC Grant Scheme, direct cash subsidy is extended to deserving cases, which is called Cash Payout. Small and developing businesses cannot afford the investment of capital outlay, for incurring the qualifying expenditure for innovation and modernization purposes. In such cases, they are extended with 60% of the qualifying expenses as direct cash incentive of Cash Payout. This subsidy is not taxable. The qualifying expenditure should have been spent in a financial year to avail the proportionate subsidy. You can get in touch with our experts to ascertain more and exact details in this regard.

4.For availing these Cash Incentives, are businesses that engage part time and full time employees simultaneously eligible?

For evaluating the eligibility criteria of a business to avail Cash Incentives, IRAS has certain norms. They consider total employment by the business, whether they are part time or full time, and check only whether these employees are Singapore citizens or Permanent Residents of Singapore.

However, the following categories will not be considered as “employees” in its strict sense:

 

  • Self-employed in the business (meaning the Sole-proprietor or Partner under Service Contract)
  • A Shareholder who also acts as Director of the Company or Business.
5.For submitting to IRAS will a copy of the Cash Payout Application enough?

No – only original Cash Payout Application (hard-copy) duly signed by the authorized officials of the business are accepted by IRAS. These authorized signatories will be either the Sole Proprietor of a Business or a Director of a Company. In case, the Cash Payout Application is signed by any other person, it is mandatory to submit the application along with the Letter of Authority, authorizing that person by the authorized signatory.

6. If the qualifying expenditure is funded by a statutory body or government funds, under partial or full funding schemes, will it affect the eligibility under PIC Grant Scheme?

IRAS officials will scrutinize every individual application case-by-case for sanctioning PIC Grant Incentives. The funding will also be considered for appropriate deduction as per rules. You can contact our experts to get more and full details in your case.

7.For companies suffering taxation at concessionary rate, how the PIC Grant Scheme benefits will vary?

PIC Grant Scheme benefits are available for such companies also. The stipulation is the qualifying expenditure should have been sustained throughout the basis period for YAs 2011-2018.

8.How many claim applications need be submitted in cases of multiple sole-proprietorship enterprises, owned by a single owner?

Only one claim application need be submitted so as to cover all the sole-proprietorship enterprises owned by the single owner.

Contact us for more information of further clarification on any aspect of the PIC or PIC+ scheme.