So, you’re decided to make the big leap for your business by getting an e-commerce website. You’ve heard of the Productivity and Innovation Credit (PIC) Scheme administered by IRAS but you don’t know whether you can claim the PIC grant for the purchase of an e-commerce website. Look no further. We’ve got the answer.
Businesses that are registered in Singapore and meet the requirements, can claim for PIC if they’ve made a qualifying expenditure on a new eCommerce website or for the incorporation of eCommerce features on their existing website. Businesses are setting up online shops for the many advantages they bring. Read our article on ‘Can I Claim PIC Grant For My Online Shop‘ to compare the pros and cons of owning an online and retail shop.
1. You Can Claim PIC for the Procurement of a New eCommerce Website
You are eligible to make a claim for the PIC grant when you procure a new website for your business, regardless whether it is an eCommerce Website. Website development falls under the category of ‘Acquisition & Leasing of PIC IT & Automation Equipment,’ which is one of the six activities that qualify for PIC. The one-time registration cost for the domain name of your eCommerce website is claimable as well.
What exactly is an ecommerce website? An electronic commerce website (also known as e-commerce or eCommerce website) is an online site that facilitate the trading of products or services for businesses. An e-commerce website offers the sale of goods or services to both consumers and businesses via the Internet.
2. You Can Claim PIC for the Incorporation of eCommerce Features to the Existing Website
The revamp of an existing website is not considered a provision of a new website and therefore, it doesn’t qualify for PIC. However, if there are costs incurred on the incorporation of e-commerce features to the website, these expenditures will be eligible for PIC claim as such enhancements are regarded as software development.
Some e-commerce website features may include:
|Catalogue Management System||Allows the business to manage, list, categorise, edit and display product/service’s information and images. Allows the consumer to search, sort and view information on the product/service.|
|Payment Gateway||Facilitates online payment for procurement of product/service.|
|Customer Management System||Allows the business to manage customer accounts, view customer details and orders.|
|Order Management System||Allows the business to receive an automated email upon confirmation of an order, view order information and purchase details. Enables the business to manage and update order status.|
|Discount & Promotion Management System||Enables the business to manage discount and promotion codes, set the promotion duration or criteria.|
|Search Engine Optimisation (SEO) Management System||Enables the business to configure META tags and description for product/service pages, set webpage titles, image titles and alt text. Allows the business to assess onsite SEO for webpages.|
3. You Can Claim PIC if Your Business Meets the Qualifying Conditions
Having a qualifying expenditure alone, does not validate your business to claim for PIC. Your business must meet qualifying conditions and these requirements vary, depending on whether you are opting to make a claim for PIC+ Scheme (tax deductions/allowances) or PIC Cash Payout.
|Tax Deductions/Allowances||To qualify for the PIC+ Scheme, businesses must have (a) active business operations in Singapore, (b) incurred qualifying expenditure and are entitled to PIC during the basis period of qualifying YA and (c) a revenue that is not more than $100 million or an employment size that is not more than 200 employees. This criteria will be applied at the group level if the business is part of a group.|
|Cash Payout||To qualify for the PIC Cash Payout, businesses must have (a) active business operations in Singapore (b) incurred qualifying expenditure and are entitled to PIC during the basis period of qualifying YA (c) meets the three-local-employee condition and (d) minimum qualifying expenditure of $400 for each cash payout option application.|
With online consumerism thriving, an e-commerce website will definitely be a good investment for your business. Find out how you can build your website and claim for PIC via our infographics. Share the good news to fellow entrepreneurs and business owners!
Note: PIRR Creatives does not represent Inland Revenue Authority of Singapore (IRAS) nor the PIC. The approval and payment of the respective claims lie within the sole discretion of IRAS. For an accurate and complete read about the PIC, please visit the IRAS website.