COVID-19 Business Support and Tax Measures
Through the Resilience Budget and Solidarity Budget, several measures of support and tax have been introduced to relieve the cash flow problems faced by businesses. Here are the support and tax relief measures that the government has inducted in order to cushion the impacts of the COVID-19 pandemic on businesses.
1. Jobs Support Scheme
As a result of the Resilience Budget, businesses across various industries will be receiving cash grants from May to July 2020. For all industries excluding Aviation, Tourism, and Food, a 25% cash grant will be given. Businesses in Aviation and Tourism industries will be given a 75% cash grant, and businesses in the Food industry will be given a 50% cash grant.
2. Wage Credit Scheme
As an enhancement to the Wage Credit Scheme, qualifying gross monthly wage ceilings will increase from $4000 to $5000 for 2019 and 2020. The additional payout for the 2019 increment in wage has also been advanced to June 2020.
3. Immigration Measures
Employment and dependent passes with original expiry dates between 6 April 2020 and 5 May 2020 have been extended to 5 June 2020.
Tax Relief Measures
1. Extension of Tax Filing Deadlines
The deadline for filing income tax returns for trusts, clubs, and associations has been extended to 30 June 2020. The same applies to the deadline for filing Estimated Chargeable Income for companies with financial years ending in January and February 2020.
2. Extension of Corporate Income Tax Payment
Businesses with income tax payment originally due between April and June 2020 will enjoy an extension of payment deadline by three months.
3. Local Tax Residency
A local tax resident is one that exercises corporate control and management within Singapore. There are firms with only one nominee director in Singapore that do not hold the Board of Directors meetings within Singapore. Furthermore, decision making may not stem from the nominee director in Singapore. As such, it will be deemed that the control and management of the firm are not exercised within Singapore. However, due to current travel regulations, such firms may qualify as local tax residents for the Year of Assessment 2021, if they meet the requirements. Subsequently, these firms will be able to reap the benefits of local tax residents, such as tax benefits under Singapore’s Avoidance of Double Taxation Agreements and tax exemption for new start-up companies.
4. Property Tax Rebates for Commercial Properties
Commercial properties in Singapore will also be given Property Tax Rebates (PTRs). For commercial properties such as hotels, restaurants, tourist, and entertainment attractions, there will be a 100% PTR. Integrated Resorts such as Marina Bay Sands and Resorts World Sentosa will receive a PTR of 60%. Lastly, non-residential properties such as offices and warehouses will receive a PTR of 30%.
5. Extension of Filing Foreign Account Tax Compliance Act and Common Reporting Standards Returns
The deadlines for filing Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standards (CRS) returns have also been extended to 31 August 2020.