Maximise Singapore’s Tax Incentives to Grow Your Small Business

Singapore has built a reputation as one of the world’s most business-friendly hubs and rolled out a range of incentives to help small businesses thrive.

Companies established in the city can access attractive corporate income tax reliefs, claim straightforward deductions on business expenses, and qualify for exemptions from mandatory statutory audits. These measures are designed to ease compliance costs, free up cash flow, and empower entrepreneurs in shaping sustainable businesses in one of Asia’s most dynamic economies.

• SUTE & PTE Schemes Driving Greater Savings
• Boost Cash Flow & Reduce Taxes with Smart Deductions
• Save Time & Cut Costs with Audit Exemptions
• Strategic Tax Planning with AsiaBC

With a competitive 17% corporate tax rate and generous relief schemes, Singapore has become one of Asia’s most attractive destinations for start-ups and small businesses. These incentives give companies more room to reinvest profits and manage compliance costs effectively.

Start-Up Tax Exemption Scheme
SUTE was introduced to encourage entrepreneurship and support emerging local enterprises. This scheme provides generous tax breaks during the first three consecutive Years of Assessment :

• 75% tax exemption on the first SG$100,000 of chargeable income.
• 50% tax exemption on the next SG$100,000 of chargeable income.

SUTE applies to newly incorporated local companies with at least one individual shareholder who holds 10% of the company’s shares and excludes businesses such as property developers and investment holding entities.

Partial Tax Exemption
Companies that do not qualify for SUTE can still benefit from the PTE, which offers ongoing tax relief across all qualifying firms :

• 75% exemption on the first SG$10,000 of chargeable income.
• 50% exemption on the next SG$190,000 of chargeable income.

This means a company can secure up to SG$102,500 in tax savings per Year of Assessment under the PTE.

Businesses in Singapore can lower their taxable income by deducting expenses that directly relate to earning revenue. These deductions help reduce tax liabilities and improve cash flow.

To qualify, expenses must meet all of the following conditions :

• Direct link to income – Costs must be spent solely to generate business revenue.
• Not a pending liability – Expenses must already be paid or incurred, not just planned or uncertain.
• Revenue in nature – Spending should bring short-term benefits, not long-term capital gains.
• Allowed under the Income Tax Act – Costs must not appear on IRAS’ restricted list.

Whether an expense qualifies depends on its purpose and nature. IRAS provides a comprehensive A – Z guide of commonly claimed business expenses to help companies stay compliant.

ACRA introduced the audit exemption scheme for “small companies” to lower compliance costs and make financial reporting more efficient. This exemption allows eligible entities to prepare unaudited financial statements, saving both time and resources.

An organisation qualifies as a “small company” if it is a locally incorporated private entity and meets at least two of the following criteria in each of the immediate past two financial years :

• Total revenue not exceeding SG$10 million.
• Total assets not exceeding SG$10 million.
• Number of employees not exceeding 50.

If the entity is part of a corporate structure, the entire structure must also meet at least two of these criteria for the exemption to apply. An entity loses its “small company” status if it stops being a private entity or fails to meet at least two of the three criteria for two consecutive financial years.

Qualifying for audit exemption can significantly reduce compliance costs and allow small companies to focus on driving growth.

Making the most of Singapore’s tax incentives isn’t just about saving money – it’s about freeing up your capital to unlock resources for reinvesting in growth, innovation, and long-term sustainability. Leveraging schemes such as the Start-Up Tax Exemption (SUTE), Partial Tax Exemption (PTE), deductible business expenses, and audit exemptions helps companies streamline compliance while boosting profitability.

Focusing on effective tax planning enables businesses to :

• Optimise cash flow and channel savings into expansion or new opportunities.
• Maintain compliance with evolving regulations and avoid costly mistakes.
• Gain a competitive edge by tapping into every eligible incentive.

AsiaBC helps companies navigate Singapore’s tax landscape with clarity and confidence. Get in touch with our team today via WhatsApp +852 9578 0528 or email business@asiabc.com.hk to ensure your business maximises its tax benefits and stays fully compliant – while freeing up more time to focus on growth.

銀行開戶準則银行开户准则銀行戶口银行户口Tags: bankingTags:Tags: singapore, corporate tax savings, tax relief, business cash flow, sute, pte