Quick answer
In Singapore, a business expense is deductible in 2026 if it is incurred wholly and exclusively to produce income and is not capital or private. Equipment is written off through capital allowances, often in one year for items up to SGD 5,000. Private car costs, income tax and personal spending are never deductible.
Last reviewed: November 2026 · Reviewed by Stéphane Gombauld, tax expert, technologist and digital nomad
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Check my business setup →You run a business in Singapore, through a company or as a sole proprietor, and want to know which costs reduce your tax. Some rules are generous, some catch people out. After reading, you'll know what to claim, what not to claim and how your structure changes the answer.
Singapore business expenses in 2026: the key figures
| Item | Rule for year of assessment 2026 |
|---|---|
| General test (s14 Income Tax Act) | Wholly and exclusively incurred in producing income, revenue in nature |
| Private car (S-plated) costs | Not deductible, including COE, fuel, parking and lease |
| Low-value assets | 100% in one year, up to SGD 5,000 each and SGD 30,000 in total |
| Computers, prescribed automation equipment | 100% capital allowance in one year |
| Other plant and machinery | Written off over 3 years, or over working life |
| Renovation and refurbishment (s14Q) | Deducted over 3 years, capped at SGD 300,000 per 3-year period |
| Medical expenses for staff | Capped at 1% of total remuneration (2% with portable medical benefits) |
| Enterprise Innovation Scheme (YA 2024–2028) | 400% deduction on up to SGD 400,000 per qualifying activity |
Is this guide for you?
Read on if you…
- run a Singapore Pte Ltd, sole proprietorship or partnership;
- buy equipment, rent an office or travel for work;
- want to cut tax legally without inviting an IRAS audit.
Probably not your case if you…
- are an employee – employees can claim only very limited expenses;
- are looking for personal reliefs like parent or course fee relief – see personal tax deductions and benefits of Singapore.
What counts as a deductible business expense?
Section 14 of the Income Tax Act sets the test. The cost must be:
- Incurred – you actually owe or paid it.
- Wholly and exclusively for producing income – no private element, or you split it.
- Revenue, not capital – a running cost, not the purchase of a lasting asset.
Typical deductible costs:
- staff salaries, bonuses and CPF up to statutory amounts;
- director's fees and your own salary, if you're a director of your company;
- office or co-working rent, utilities and internet;
- software subscriptions, professional fees and insurance;
- business travel and accommodation;
- entertainment of clients and staff, if clearly business-related and documented;
- interest on loans used for the business.
Costs incurred in the year before your first revenue are generally deductible too, so pre-launch expenses aren't wasted.
What can you never deduct?
Section 15 lists the exclusions. The ones that bite most:
- Private cars. All costs of S-plated or Q-plated passenger cars are disallowed: purchase, COE, road tax, fuel, parking, lease, insurance. Commercial vehicles and taxis are fine.
- Private and domestic expenses – your groceries, rent on your flat, family travel.
- Capital expenditure – deducted only through capital allowances.
- Income tax and fines.
- CPF contributions above the statutory amounts.
- Club memberships and entrance fees.
For GST-registered businesses, input GST on cars, club fees and some staff benefits is also blocked. See specific taxes in Singapore for GST basics.
How do you write off equipment and renovation?
You can't deduct a laptop like a utility bill. You claim capital allowances – basically depreciation for tax.
- Low-value assets: items of up to SGD 5,000 each are written off in full in the year bought. The total is capped at SGD 30,000 per year of assessment.
- Computers and prescribed automation equipment: 100% in one year, no cap.
- Other plant and machinery: spread over three years, or over the asset's working life if you prefer.
- Renovation and refurbishment: office fit-out costs are deducted over three years, capped at SGD 300,000 for each three-year period.
Unused capital allowances carry forward, subject to the same shareholding test as losses.
Enhanced deductions
The Enterprise Innovation Scheme gives a 400% deduction on up to SGD 400,000 each year for qualifying R&D, IP registration, IP licensing, innovation projects with approved institutions and approved training. Small companies with at least three local employees can instead convert up to SGD 100,000 of spending into a 20% cash payout. Market expansion costs abroad can qualify for 200% under the double tax deduction for internationalisation.
Does your business structure change what you can claim?
The deduction rules are the same, but who benefits and at what rate changes.
| Entity | Liability | Minimum capital | Setup cost and time | Tax on profits after expenses | Can a non-resident run it remotely? |
|---|---|---|---|---|---|
| Private limited company | Limited | SGD 1 | ACRA fee SGD 315; 1–3 days | 17%, with partial or start-up exemption | Yes, with one locally resident director |
| Sole proprietorship | Unlimited | None | Low; same day | Owner's personal rates, 0–24% | Needs a local authorised representative |
| Limited liability partnership | Limited per partner | None | Low; 1–2 days | Each partner at personal rates | Needs a local manager |
A company can deduct the salary it pays you; a sole proprietor can't pay himself a deductible salary. Sole proprietors with revenue up to SGD 200,000 file a simple four-line statement in Form B. Compare structures in legal forms of business in Singapore, the rates in corporate income tax in Singapore, or get help through Heavnn business setup.
Here's the catch for remote founders. If the company is run from abroad, its control and management may sit outside Singapore. It can then lose Singapore tax residence, or create a permanent establishment – a taxable presence – where you work. Your deductions then follow that country's rules, not Singapore's.
Example – Aisha, Australian marketing consultant
Aisha's Pte Ltd, in its fourth year, earns SGD 300,000 in 2026. It deducts her SGD 120,000 salary, SGD 12,000 co-working rent, SGD 8,000 software, SGD 10,000 travel, SGD 4,000 client entertainment and two SGD 3,000 laptops written off in full. Total deductions: SGD 160,000. Chargeable income of SGD 140,000, after partial exemption, gives SGD 11,475 of tax. Her leased S-plated car, SGD 15,000 a year, is not deductible, so she keeps it out of the accounts.
Aisha's deductions are clean and documented. Are yours?
Heavnn reviews your expenses and structure so you claim everything you're allowed to, and nothing more.
Check my business setup →Common mistakes (and what they cost)
- Claiming your private car through the company → expense disallowed, back tax and penalties of up to 200% of the tax undercharged.
- Deducting a SGD 12,000 server in one go as a low-value asset → over the SGD 5,000 per-item limit; IRAS spreads it, and you owe the difference.
- Charging your apartment rent to the company without a lease or business use → private expense, disallowed.
- Keeping no receipts for entertainment → the claim fails on audit; records must be kept for five years.
- Running the company from abroad → the company may become taxable in your home country, making Singapore deductions irrelevant.
Frequently asked questions
What business expenses are tax-deductible in Singapore in 2026?
Costs wholly and exclusively incurred to produce business income, of a revenue nature, are deductible. That includes salaries, CPF up to statutory limits, rent, utilities, software, professional fees, business travel, documented entertainment and loan interest. Capital purchases are claimed through capital allowances instead. Private costs, private car expenses and income tax are never deductible.
Can I deduct my car in Singapore?
Not if it's a private passenger car. All costs of S-plated and Q-plated cars, including the COE, purchase price, fuel, parking, road tax and insurance, are disallowed under section 15. Commercial vehicles such as vans and lorries, and cars used as taxis or for driving instruction, are deductible. Input GST on private cars is also blocked.
How are laptops and equipment written off?
Through capital allowances. Computers and prescribed automation equipment get 100% in one year. Other low-value assets up to SGD 5,000 each are written off in one year, capped at SGD 30,000 in total per year of assessment. Other plant and machinery is written off over three years or its working life.
Can a sole proprietor deduct a home office?
Partly. If you use a specific part of your home for business, you can claim a reasonable share of rent and utilities, based on the space and time used for business. Mortgage interest on your home is only deductible where part of the property produces income. Keep a clear basis for the split.
Are pre-incorporation expenses deductible?
Generally yes. Business expenses incurred in the accounting period immediately before your company earns its first revenue are deductible, for example market research, website development costs of a revenue nature and early professional fees. Incorporation costs themselves are also deductible within limits. Keep invoices in the company's name where possible.
How long must I keep receipts in Singapore?
Five years from the relevant year of assessment. That covers invoices, receipts, bank statements, contracts and the working papers behind your return. IRAS can ask for them during a review, and missing records lead to disallowed claims and possibly penalties. Digital copies are accepted if they're complete and readable.
Related guides
- Corporate income tax in Singapore – rates, exemptions and filing.
- Legal forms of business in Singapore – choosing your structure.
- Specific taxes in Singapore – GST and stamp duties.
- Tax fraud regulations of Singapore – what wrong claims cost.
- Tax landscape overview of Singapore – the full Singapore tax picture.
- Business expenses in Hong Kong and business expenses in Thailand – regional comparison.
- All country tax guides
Sources
- IRAS – Corporate income tax
- IRAS – Individual income tax (self-employed)
- Income Tax Act 1947, Singapore Statutes Online
- ACRA – Accounting and Corporate Regulatory Authority
- Ministry of Finance Singapore – Budget
This guide is general information, not personalised tax advice. See how we research and review.
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