Knowing Double Tax Deduction for Internationalisation Further
The coherent tax scheme in Singapore is one of the reasons for people being interested in opening a business in the city-state and on top of that, there many other programs that help businesses benefit even more on this aspect by reducing the already low tax provisions that they have to pay. Among them is the Double Tax Deduction for Internationalisation (DTDi), which helps reduce the taxes for the Singapore-based companies looking to expand in the foreign market. Here, we present you everything that you should know about the scheme.
Double Tax Deduction for Internationalisation (DTDi): What is it?
This is a program which is to encourage the internationalisation of the corporations in Singapore. With it, the Singapore companies can claim a tax reduction of 200% for the activities which are under the scope of the qualifying activities under the specified cap. The cap is S$100,000 at the moment, which will increase to be S$150,000 in the Year of Assessment 2019.
To gain a DTDi, the businesses don’t need any prior approval from the Enterprise Singapore or Singapore Tourism Board to enjoy a tax reduction for the following activities.
- Foreign business trips or missions
- International trade fairs
- Local trade fairs approved by Enterprise Singapore or Singapore Tourism Board
- Overseas investment study trips and missions
Keep in mind, this is only for the first S$100,000 spent by the company, and if the expenses exceed that, you will need approval from Enterprise Singapore, as for with the following activities.
- Designing and packaging for overseas business
- Getting a product or a service certified
- Conducting surveys or other studies
- International Advertising and business promotions
- Advertising in the approved local publications
- International trade offices
- Oversea posting of the employees
- Investment feasibilities
Eligibility for the DTDi
These are the requirements for a company to be eligible for the Double Tax Deduction for Internationalization (DTDi).
- The company should be based in Singapore and should be willing to contribute to the market trading goods and services.
- The Businesses enjoying discretionary incentives, if their headquarters in Singapore may qualify for the DTDi scheme if approved by Enterprise Singapore or Singapore Tourism Board.
The Application Process
If your business complies with the above terms, then you could apply for the DTDi. Here are the steps for you to do that. Make sure you make your application before you start the project.
1) Register in this link.
2) For the qualifying activities, not under the scope of the automatic DTDi or any investment more than S$100,000 you should submit your application online along with your SingPass/ CorpPass for activities. While your request is being processed, you might also be asked for more documents for extra verifications.
3) If your application is approved, you will need to submit the evaluation form after you complete your project. After that, Enterprise Singapore will issue a letter of support for you with the Inland Revenue Authority of Singapore (IRAS).
4) The next time you fill the annual tax return forms of the Inland Revenue Authority of Singapore (IRAS), you will need to attach the letter of support you received from Enterprise Singapore. Also, you might need to submit other documents from the IRAS, which should be made available as per the request.
Upon approval by the IRAS, you will receive the benefits from the scheme.
Well, this was all for the Double Tax Deduction for Internationalization (DTDi). We are glad if this article helped you.