GOVERNMENT GRANTS & SCHEMES

What is Start-up Tax Incentives?

Start-ups that meet certain qualifying conditions do not need to pay tax on the first $100,000 of chargeable income (excluding Singapore franked dividends) for any of the first 3 years of tax assessment from Year of Assessment 2005).  Additionally, there is a 50% tax exemption on the next $200,000 for each of the first three consecutive years.

This will help start-ups preserve their cash flow and profits.

Who is eligible?

  1. Company should be incorporated in Singapore
  2. A tax resident of Singapore in that YA
  3. Has no more than 20 shareholders throughout the basis period for that YA where:
    • all of the shareholders are individuals beneficially holding the shares in their own names; OR
    • at least one shareholder is an individual beneficially holding at least 10% of the issued ordinary shares of the company
Startup SG assistances

Startup SG Founder provides mentorship and startup capital grant to first-time entrepreneurs with innovative business ideas. Enterprise Singapore will match $3 for every $1 raised by the entrepreneur.

Enterprise Singapore has appointed Accredited Mentor Partners (AMP) that will identify qualifying applicants based on the uniqueness of business concept, feasibility of business model, strength of management team, and potential market value. Adapted from http://www.startupsg.net/startupsg-founder/

The Startup SG Tech grant fast-tracks the development of proprietary technology solutions, and catalyses the growth of startups based on proprietary technology and a scalable business model. Through Startup SG Tech, companies may receive early-stage funding for the commercialisation of proprietary technology. Adapted from http://www.startupsg.net/startupsg-tech/

As part of the Startup SG Equity scheme, government will co-invest with independent, qualified 3rd party investors into a startup. This scheme aims to stimulate private-sector investments into innovative, Singapore-based technology startups with intellectual property and global market potential. Adapted from http://www.startupsg.net/startupsg-equity/

Startup SG Accelerator supports incubators and accelerators in strategic growth sectors that take on the role of catalysing growth opportunities for high potential startups through their programmes, mentorship and provision of resources. Startup SG Accelerator will provide funding and non-financial support for these partners to further enhance their programs and expertise in nurturing successful startups. Adapted from http://www.startupsg.net/startupsg-accelerator/

The Startup SG Talent pillar highlights schemes that foster a more conducive environment for promising global talent to set up innovative businesses in Singapore, and for startups to attract talent to be part of their team. Schemes under this pillar include: EntrePass, T-Up and SME Talent Programme (STP) for Startups. Adapted from http://www.startupsg.net/startupsg-talent/

Startup SG Infrastructure provides startups with the spaces that they need to grow, experiment and flourish.

JTC LaunchPad @ one-north is master developed by JTC, and is an initiative supported by A*STAR, IMDA, NRF and Enterprise Singapore. It is a vibrant and nurturing environment for startups and enablers in the biomedical sciences, infocomm, media, cleantech, electronics and engineering industries. Adapted from http://www.startupsg.net/startupsg-infrastructure/

The Startup SG Investor pillar highlights tax incentives for individuals or fund management companies that are actively investing in startups and/or other Singapore companies. Adapted from http://www.startupsg.net/startupsg-investor/

The Startup SG Loan pillar highlights Government-backed loans for your working capital, equipment/factory financing and trade financing needs, offered through Participating Financial Institutions. See which loan suits you best: Adapted from http://www.startupsg.net/startupsg-loan/

The available loan assistance for your company:

Microloan

What is Microloan?
It helps small businesses get fixed interest rate loans of up to S$100,000 that will help them fund the daily operations of their business.

Who is eligible?
Registered or incorporated in Singapore
Company has 10 or less employees OR has annual sales not exceeding S$1 million
At least 30% local shareholding

Where can you apply?

Interested companies may approach any of the following Participating Financial Institutions to apply for SME Micro Loans*.

Participating Financial Institutions Contact
DBS Bank Ltd 1800 222 2200
Ethoz Capital Ltd 6654 7799
Hong Leong Finance Ltd 1800 3388 338
IFS Capital Ltd 6270 7711
Malayan Banking Berhad 1800 777 0022
ORIX Leasing Singapore Ltd 6339 3622
Oversea-Chinese Banking Corporation Ltd 6538 1111
RHB Bank Berhad 1800 323 0100
United Overseas Bank Ltd 1800 2266 121
*Subject to banks’ credit approval

Interest Rates:
*Minimum 5.5% interest rate for loan tenure of 4 years and below.
* Subject to Participating Financial Institutions’ assessments of risks involved.

How to apply?
Download the application form and the application form guide
Submit the Application Form with the supporting documents
Wait 3 weeks for the bank or financial institution to reply. Processing of applications may be longer depending on the size of the loan and other factors.

Adapted from https://www.smeportal.sg/content/smeportal/en/moneymatters/loans/sme-micro-loan.html

SME Go Digital by IMDA

To support local SMEs, the IMDA has developed an array to schemes which are tailored to their specific needs.

Examples:

  • Optimising the deployment of field workers (cleaners, maintenance, delivery, inspectors, etc.) through higher visibility of needs and availability of workers
  • Better use of logistics vehicles through smart queue systems and information from traffic systems
  • Smarter automation through the use of sensors and robots in F&B, retail, construction and transport
  • New business from the Smart Environment as Singapore uses more energy management and sustainable environment technologies (such as smart lighting, emission detection, etc.)

The SMEs Go Digital programme is designed to assist SMEs to build stronger digital capabilities and deploy digital technologies based on the SME’s level of digital readiness.

For a start, SMEs can approach any SME Centre for basic Infocomm advice.

Level of Digital Readiness – Support available under SMEs Go Digital

Basic – SME Centres will provide advice on IMDA pre-approved off-the-shelf digital solutions supported by Government grants. SMEs may also refer to the pre-approved list of proven digital solutions and contact the identified solutions provider directly

Should the SMEs require more advanced advice, SME Centres will refer the SMEs to the SME Digital Tech Hub for more tailored support

Advanced – SME Digital Tech Hub will provide SMEs with more advanced advice in areas such as data analytics, cybersecurity and business transformation.

IMDA will also work closely with SMEs who are paving the way for their peers in deploying digital technologies such as smart sensors and autonomous systems in their sectors

Adapted from https://www.imda.gov.sg/industry-development/programmes-and-grants/small-and-medium-enterprises/smes-go-digital

Home Office Scheme (HO)

What is Home Office Scheme (HO)?
Any small businesses who wish to operate from home can do so by opting for this scheme. It’s necessary to be either the owner, tenant, authorized occupier of a residential property to quality.

The scheme will provide a flexible platform for entrepreneurs to conduct their business from their homes and help save on rental and refurbishment cost as well.

Who is eligible?

To set up a Home Office in a private residential property, homeowners must meet the Terms and Conditions of the Home Office Scheme. The business must satisfy the Home Office Performance Criteria.

How does it work?

There are two types of residential property.

  1. Housing & Development Board (HDB) – You will have to apply to HDB
  2. Private Home – You will have to apply to the Urban Redevelopment Authority (URA)

There is an administration fee (non-refundable) of S$20 (inclusive of GST) for each application.

Upon successful registration with URA, a one-time permit for home office use will be granted.

Capability Development Grant (CDG)

The Capability Development Grant (CDG) aims to support SMEs to scale up business capabilities and ensure business sustainability. You can take on projects in areas like product development, human capital development, business processes enhancements for productivity and business model transformation. The grant defrays up to 70 percent* of qualifying project costs such as consultancy, training, certification and equipment costs.

The application requirements for smaller scale projects, for grant support of S$30,000 or less has also been simplified. You can look forward to more streamlined application forms and documentation requirements.

With effect from 1 January 2017, SMEs seeking CDG support for consultancy-related costs under their upgrading projects will have to engage management consultants who possess Enterprise Singapore-recognised certification. Management consultants who wish to serve SMEs in their CDG-supported upgrading projects should approach any of the appointed certification bodies to get certified.

Adapted from https://www.smeportal.sg/content/smeportal/en/moneymatters/grants/capability-development-grant.html

For further clarification please contact SME Centre @ SICCI.