Singapore's Budget 2025 introduces targeted tax and incentive measures to support businesses amid evolving global challenges. Here are some highlights of the key changes and how they may impact your business.
Corporate Income Tax Rebate & Cash Grant
To help businesses manage operating costs and maintain competitiveness, the government has introduced a Corporate Income Tax (CIT) Rebate and Cash Grant scheme for Year of Assessment (YA) 2025:
- 50% CIT Rebate will be automatically granted to all companies based on their tax payable.
- Minimum $2,000 Cash Grant for companies that:
- Were active in Calendar Year (CY) 2024, and
- Employed at least one local employee in the same year.
- The maximum combined benefit from the rebate and cash grant is capped at $40,000 per company.
- Eligible companies will automatically receive the payout from the second quarter of 2025 onwards.
📈 Enhanced Support: Progressive Wage Credit Scheme (PWCS)
The PWCS continues to support employers in uplifting lower-wage workers, with enhanced co-funding levels announced for the next two years:
- For wage increases in 2025:
- Government co-funding raised from 30% to 40%
- Payout to be made in Q1 2026
- For wage increases in 2026:
- Government co-funding raised from 15% to 20%
- Payout to be made in Q1 2027
This transitional wage support helps businesses adapt to rising wages while staying competitive.
🧾 Tax Rebates at a Glance
- Corporate Tax Rebate:
50% rebate on corporate income tax for YA 2025, minimum $2,000 benefit, capped at $40,000. - Personal Tax Rebate:
Individuals will receive a 60% income tax rebate for YA 2025, capped at $200 per taxpayer.
International Expansion & Financing Support
- Market Readiness Assistance (MRA) Grant: Extended until 31 March 2026, this grant offers up to S$100,000 per new market to support SMEs in overseas market promotion, business development, and setup costs.
- Double Tax Deduction for Internationalisation (DTDi): Extended until 31 December 2030, allowing businesses to claim a 200% tax deduction on qualifying expenses for international market expansion and investment development.
- Enterprise Financing Scheme (EFS):
- Trade Loan: The maximum loan quantum is permanently increased from S$5 million to S$10 million to support businesses' trade financing needs.
- Mergers & Acquisitions (M&A) Loan: From 1 April 2025 to 31 March 2030, the scope is expanded to include targeted asset acquisitions, providing more flexible financing options for businesses pursuing growth through acquisitions.
💻 Digital Transformation & Innovation
- Enterprise Compute Initiative: A new program allocating up to S$150 million to assist businesses in integrating artificial intelligence (AI) solutions through partnerships with major cloud service providers, enhancing digital capabilities and competitiveness.
- SkillsFuture Workforce Development Grant: Introduced to provide up to 70% funding for job redesign activities, helping businesses adapt to technological advancements and evolving job roles.
- Revamped SkillsFuture Enterprise Credit: Launching in the second half of 2026, this redesigned credit offers S$10,000 per company in an online wallet format, simplifying the process of offsetting costs for workforce and enterprise transformation initiatives.
🧓 Inclusive Employment Support
- Senior Employment Credit (SEC): Extended until 31 December 2026, this scheme provides wage offsets of up to 7% for employers hiring Singaporean workers aged 60 and above earning up to S$4,000 per month, encouraging the employment of senior workers.
- Uplifting Employment Credit: Extended to end-2028, this initiative offers wage offsets to employers hiring ex-offenders, promoting inclusive hiring practices and expanding the talent pool for businesses.
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