To help businesses manage the economic impacts of COVID-19, the Singapore government is offering a number of stimulus packages and grants, which offer local businesses a mix of support for ongoing employment, while seeking to minimise income and property taxes. The government has also announced additional budget measures to help businesses cope with the immediate challenges of COVID-19 and support long-term stability. The combined stimulus packages offer S$59.9 billion in support and amount to around 12% of national GDP.
Here is NetSuite’s guide to decoding Singapore’s stimulus package and grants:
Government support is available to help workers stay employed. This is available in two different ways:
Overview: The government is co-funding the first S$4,600 of wages for all employees for nine months. Employers will receive a 25% cash grant, up from 8% announced in February, for the monthly wages of each local employee on their payroll from October 2019 to June 2020. All workers are eligible to receive 75% of the first S$4,600 wages for April and May 2020, across all sectors.
There are three levels of support for employers in different sectors. Pay-outs for the remaining qualifying months beyond April and May will support 75% of the first S$4,600 for the Aviation and Tourism sector, 50% of the first S$4,600 for the Food Services sector and 25% of the S$4,600 for all other sectors.
Who is eligible? All employers who have made CPF contributions for their local employees (Singapore Citizens and Permanent Residents) will qualify for the pay-out. There is an e-Service where you can enquire about your eligibility for the scheme.
How to access it: Employers do not need to apply – the IRAS will notify by post the tier of support and the amount of JSS pay-out. If you believe you are eligible for a different tier of support, you can contact the IRAS.
Overview: This is an enhancement of the existing Wage Credit Scheme. The qualifying monthly wage ceiling for the scheme was increased to S$5,000, up from the current S$4,000. The government co-funding levels for 2019 and 2020 were raised from the current 15% and 10% to 20% and 15% respectively.
Who is eligible? Employers giving wage increases to Singaporean citizens who meet a number of conditions.
How to access it: Employers that qualify for the 2019 wage increases will be notified by the end of June 2020 and will receive a supplementary pay-out afterwards.
Income Tax Rebate
Overview: Announced as part of the February 2020 budget, businesses can access a corporate income tax rebate for the year of assessment 2020 at a rate of 25% of tax payable and capped at S$15,000 per company.
Who is eligible? All businesses that file taxes in Singapore
How to access it: The corporate income tax rebate is computed on the tax payable after deducting tax set-offs (e.g. foreign tax credit).
Overview: All companies with corporate income tax (CIT) payments due in the months of April, May and June 2020 are granted an automatic three-month deferment of these payments. The tax payments that are deferred from April, May and June 2020 will be collected in July, August, and September 2020 instead.
Who is eligible? All businesses and self-employed persons in Singapore with payments due April - June
How to access it: Eligible companies should receive a letter by April 2020. Companies that are on GIRO will be able to view their revised instalment plans at myTax Portal from 1 May 2020. Companies that are not on GIRO and are required to make a one-time CIT payment can use this calculator.
Overview: As part of the enhanced property tax rebates, the government of Singapore has announced a rebate of up to 100% of property taxes for qualifying commercial properties, with some select properties eligible for a 60% rebate. And many other businesses in non-essential properties will receive a 30% rebate on property taxes. The bill mandates that landlords are expected to pass this relief on to their tenants by reducing rent.
Who is eligible? Non-residential businesses, including hotels, serviced apartments, shops and restaurants, among others
How to access it: Follow the guide here.
Additionally, there are several grants and loans available to businesses in Singapore. These include:
Overview: The maximum loan quantum of the existing SME Working Capital Loan program has been increased from S$300,000 to S$1 million with a maximum repayment period of five years. This has also increased the government’s risk-share up to 90% (from 50% and 70% for young companies) for new applications initiated from 8 April 2020 until 31 March 2021.
Who is eligible? Businesses must be registered and physically present in Singapore, have at least 30% equity held directly or indirectly by Singaporeans (or PRs), and revenue cap of S$500 million maximum. Small and midsized businesses can have a group revenue of up to S$100 million or maximum employment of 200 employees.
How to access it: Apply at the Enterprise Singapore website.
Overview: Previously only for enterprises in the tourism sector, this has been extended to all sectors. This aims to provide access to working capital for business needs. Eligible enterprises may borrow up to S$5 million, with the interest rate capped at 5% per annum.
Who is eligible? Business registered and physically operating in Singapore with at least 30% equity held directly or indirectly by Singaporeans or permanent residents (PRs)
How to access it: Enterprises can approach Participating Financial Institutions (PFIs) directly to apply.
Overview: The Enterprise Development Grant (EDG) helps Singaporean companies grow and transform. This grant supports projects that help upgrade a business, innovate or venture overseas. In light of COVID-19, the maximum support level will be raised to 80% of the project from 1 April 2020 to 31 December 2020.
For enterprises severely affected by COVID-19, the maximum support level may be raised to 90% on a case-by-case basis.
Who is eligible? Business registered and physically operating in Singapore with at least 30% equity held directly or indirectly by Singaporeans or PRs and in a financially viable position to start and finish the project. Applications now must include a commitment to worker outcomes.
How to access it: Find the application at the Enterprise Singapore website.
Overview: The Productivity Solutions Grant (PSG) provides support for companies to adopt IT solutions and equipment to enhance business processes. Due to COVID-19, the Singapore government is enhancing PSG to encourage enterprises to continue their digitalisation and productivity upgrading efforts. The maximum funding support level will be raised to 80% from 1 April 2020 to 31 December 2020.
The scope of solutions will also be expanded to include online collaboration tools, virtual meetings and telephony tools, queue management systems and temperature screening solutions.
Who is eligible? SMEs can apply for PSG if they are registered and operate in Singapore, the IT solutions or equipment purchased will be used in Singapore and have a minimum 30% local shareholding
How to access it: Find more details on the application at the Enterprise Singapore website.
Overview: Enterprises can secure short-term trade financing loans via the Loan Insurance Scheme (LIS) from Participating Financial Institutions (PFI). With the Supplementary Budget 2020, support for the LIS premium will be increased to 80% (from 50%) until 31 March 2021.
Who is eligible? Businesses must be registered and physically present in Singapore, have at least 30% equity held directly or indirectly by Singaporeans (or PRs), and a group revenue of up to S$100 million or maximum employment of 200 employees
How to access it: Enterprises can approach PFIs directly to apply.