Singapore: Tax incentives to encourage development of intellectual property

Singapore: Tax incentives, development of IP

In the budget for 2017, the Minister for Finance announced new tax incentives for the development and commercialisation of intellectual property (IP). The tax incentives will provide concessionary tax rates on income from qualifying patents and other IP rights.

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The incentive program—known as the "intellectual property development incentive—has an effective date of 1 July 2017, and will use a "modified nexus approach" which is a substance-based test. To qualify, businesses must undertake research and development (R&D) in Singapore. The tax incentives include:

  • Enhanced deductions for R&D expenditures
  • Enhanced deductions or allowances for registration, acquisition, and in-licensing of IP under Singapore's "productivity and innovation credit" regime
  • Concessionary tax rates for IP-related income

Further details are expected to be released in May 2017.

 

Read a March 2017 report [PDF 291 KB] prepared by the KPMG member firm in Singapore

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