How the Productivity and Innovation Credit (PIC) Scheme Benefits You

With the Productivity and Innovation Credit (PIC) scheme subsidised by the government, businesses can now take the opportunity to upgrade their IT and automation equipment in the office to increase the productivity and efficiency of their work flow / work processes towards their business expansion.

Under the scheme of Productivity and Innovation Credit (PIC) scheme, businesses can enjoy tax savings in the form of deductions/allowances of up to 400% or opt for non-taxable cash payouts when they invest in any of the Six Qualifying Activities.

The six activities covered under Productivity and Innovation Credit (PIC) scheme are:

a. Acquisition or leasing of PIC information technology (“IT”)3 and automation equipment (“qualifying equipment”); b. Acquisition or licensing4 of intellectual property rights (“IPRs”);

c. Registration of certain IPRs;

d. Research and development (“R&D”);

e. Training;

f. Design.

Only equipment in the prescribed PIC IT and Automation Equipment List qualify for PIC under the activity “Acquisition and Leasing of PIC IT and Automation Equipment”.

Image or graphics processing equipment, including display, facsimile, optical character reader, laser printer, plotter, image setter, digital printing, direct imaging equipment and scanner is one of the claimable item under PIC IT and Automation Equipment in one of the Six Qualifying Activities.

Businesses that invest in equipment not in the prescribed list but that serve to automate or mechanise their business processes and enhance productivity may apply to IRAS to have their equipment approved for PIC benefits on a case-by-case basis.

More details of the Productivity and Innovation Credit (PIC) scheme can be obtained from IRAS Singapore.

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