The IRAS has issued the fifth edition of the e-Tax Guide on Productivity and Innovation Credit on 22 November 2016 with a view to incorporating the Budget 2016 changes:
- Expiry of the PIC Scheme in YA 2018,
- Reduction in the PIC cash payout rate from 60% to 40% for qualifying expenditure incurred on or after 1 Aug 2016,
- Compulsory e-Filing of PIC cash payout applications with effect from 1 Aug 2016.
Other amendments include the following:
- Remove information on PIC bonus which expired after YA2015.
- The evaluation criteria for the case-by-case approval of automation equipment (see Annex A) Remove paragraph on the clarification of the basic tool criteria c. Enhanced Writing-Down Allowance (“WDA”) and Deduction for Intellectual Property Rights (“IPRs”)
- Enhancement to allow companies to make an irrevocable election to claim the WDA over a five, ten or fifteen-year period (on a straight line basis) on capital expenditure incurred in acquiring the IPR – with effect from YA 2017.
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