Development and Expansion Incentive (DEI) for Services

Who qualifies

• Must be registered in Singapore.
• The entity must be registered and operating in Singapore and meet EDB’s qualifying service-activity, employment, and expenditure conditions; headquarters and manufacturing activities are excluded from DEI(Svc).
• Qualifying services are engineering/technical services (including laboratory, consultancy and R&D), computer services, industrial design, entertainment/leisure/recreation, publishing, education, medical, agricultural technology, automated warehousing, financial, business consultancy/management/professional, international trade, auction-house, and qualifying logistics/freight-forwarding services.
• For the 5% rate: carry out at least one service activity; 18 additional Skilled Employees and additional annual Total Business Expenditure of at least S$8.0 million by Year 3; 30 employees and S$13 million by Year 5.
• For the 10% rate: at least one service activity; 15 additional Skilled Employees and S$5.5 million additional annual TBE by Year 3; 25 employees and S$9 million by Year 5.
• For the 15% rate: at least one service activity; 8 additional Skilled Employees and S$3 million additional annual TBE by Year 3; 13 employees and S$5 million by Year 5.
• Additional employment and TBE are measured against the entity’s last Financial Year as recorded in the Supplementary Form and Core Form respectively.
• TBE is annual operating expenditure incurred in Singapore and excludes overseas expenses, capital investments, depreciation, raw materials, components and packaging.
• Skilled Employees are Managers, Professionals, Associate Professionals and Technicians, or Skilled Production Craftsmen; based in Singapore means the employee is a Singapore tax resident.
• Qualifying income excludes all intellectual property income, as specified in the Economic Expansion Incentives (Relief from Income Tax) Act.
• The entity must maintain a separate account for non-qualifying activity and submit an annual progress update in the prescribed format and/or an external auditor’s report.
• Not eligible if the entity falls within Singapore Government sanctions lists, engages in illegal activities, regulated military goods or tobacco, is under investigation for regulatory breaches, is a MAS-licensed financial institution, or is an MPA-regulated shipping entity, unless specifically referred by MAS or MPA.
• Breach of the Letter of Award terms results in termination of the incentive and recovery of any associated benefits.
• Singapore's Domestic Top-up Tax applies to profits of group entities with an effective tax rate below 15% for MNE groups with annual group revenue of EUR 750 million or more in at least two of the four preceding financial years; EDB incentive recipients are not precluded and should assess the implications.

What it funds

• Core capabilities — strategy, HR, finance, branding, processes

Concessionary tax rate of 5%, 10% or 15% on qualifying income in excess of base income; base income is the average qualifying-activity income of the 36 months immediately preceding the incentive and is taxed at the normal corporate rate.

Payment: Delivered as a tax deduction, allowance or credit.

How to apply

Submit a formal application to EDB containing the Core Form and Supplementary Form.

1. Prepare the Core Form with projected incremental investment in employment, fixed assets, and total business expenditure.
2. Prepare the Supplementary Form with proposed activities and skilled employment.
3. Submit the formal application to EDB.

Documents

• Core Form
• Supplementary Form

Contact: https://www.edb.gov.sg/en/contact-us

Application window: Qualifying period stated in the factsheet is five years. No closing date stated.