Singapore’s Budget 2024, themed “Building Our Shared Future Together”, was delivered in Parliament on 16 February 2024 by then Deputy Prime Minister and Finance Minister Lawrence Wong. This article summarises the measures most relevant to companies and business owners.
1. Corporate Income Tax Rebate for YA 2024
- Companies receive a 50% corporate income tax rebate for Year of Assessment (YA) 2024.
- The rebate includes a minimum cash payout of $2,000 for companies that employed at least one local employee (Singapore Citizen or PR, excluding shareholder-directors) with CPF contributions in 2023.
- The total benefit (cash payout plus rebate) is capped at $40,000 per company.
Example: A company with tax payable of $30,000 receives the $2,000 cash payout plus a further $13,000 rebate against its tax, a total of $15,000.
2. Refundable Investment Credit (RIC)
A new tax credit to attract high-value investments into Singapore:
- Supports up to 50% of qualifying expenditure on activities such as new production capacity, R&D, regional headquarters and green transition projects.
- Credits are offset against corporate income tax, and any unused amount is refunded in cash within four years.
- Awarded on application through the Economic Development Board (EDB) or Enterprise Singapore.
3. Support for Enterprises
- Enterprise Support Package: about $1.3 billion to help businesses with costs, restructuring and growth.
- Enterprise Financing Scheme: the SME Working Capital Loan cap was raised permanently from $300,000 to $500,000. The enhanced Trade Loan cap ($10 million) and domestic construction Project Loan cap ($15 million) were extended to 31 March 2025.
- SkillsFuture Enterprise Credit: a one-off $10,000 credit for eligible employers, covering up to 90% of out-of-pocket costs for workforce and enterprise transformation programmes.
- Energy Efficiency Grant: extended to more sectors, including manufacturing, construction, maritime and data centres, to co-fund energy-efficient equipment.
- National Productivity Fund: topped up by $2 billion.
4. Workforce and Wages
- Progressive Wage Credit Scheme: government co-funding of wage increases given in 2024 raised to 50% for employees earning up to $2,500 a month and 30% for those earning above $2,500 up to $3,000. From 2025, the wage ceiling was raised to $3,000.
- Local Qualifying Salary (used to count local employees for foreign worker quotas) raised from $1,400 to $1,600 from 1 July 2024.
- Workfare Income Supplement: qualifying income cap raised from $2,500 to $3,000 a month from 1 January 2025.
CPF contribution rates for senior workers from 1 January 2025:
| Employee age | Employer | Employee | Total |
|---|---|---|---|
| Above 55 to 60 | 15.5% | 17% | 32.5% |
| Above 60 to 65 | 12% | 11.5% | 23.5% |
A one-year CPF Transition Offset covered half of the employer’s increase in 2025.
5. Other Tax Changes
- Global minimum tax (BEPS Pillar Two): a 15% minimum effective tax rate, through the Income Inclusion Rule and a Domestic Top-up Tax, for multinational groups with annual revenue of at least €750 million, from financial years starting on or after 1 January 2025. This does not apply to most SMEs.
- Renovation and refurbishment deduction: designer and professional fees qualify from YA 2025.
- Property tax: lower owner-occupier property tax rates from 1 January 2025.
6. Support for Households
- $600 in CDC vouchers per Singaporean household ($300 in June 2024 and $300 in January 2025).
- A Cost-of-Living Special Payment of $200 to $400 for eligible adults in September 2024.
- A 50% personal income tax rebate for YA 2024, capped at $200.
What This Means for Your Business
Budget 2024 focused on short-term cost relief through the tax rebate, together with longer-term support for transformation, financing and wage growth. Businesses should check their eligibility for the cash payout, review the expanded grants, and plan for higher CPF contributions for senior employees.
How We Can Help You
Our team can help you assess your tax position, apply the corporate income tax rebate correctly, and identify the grants and schemes relevant to your company. Contact us to arrange a discussion.