We refer to the letter "Make PIC scheme fairer for all firms" (10 March 2014) by Dr Steven Gregory Ang Boon Kiang.

The Productivity and Innovation Credit (PIC) scheme encourages businesses to make productivity and innovation investments starting from Year of Assessment (YA) 2011.

When PIC was announced in February 2010 as part of the 2010 Budget, the intention was for the scheme to take effect immediately so that the majority of businesses could benefit from it early. It was recognised that the basis period (the preceding financial year before the YA) for some businesses to make PIC-qualifying investments for YA 2011 would have passed, or would end in a few months.

To ensure that all businesses could benefit from the scheme and also to avoid businesses from rushing the implementation of their investments, we allowed claimants to combine their $100,000 annual expenditure cap for an overall cap of $200,000 over the two years in YA2011 and YA2012 for the PIC cash payout option.

For YAs 2013 to 2018, all businesses would have a full 12-month period to claim the PIC cash payout regardless of their accounting periods.

We have since explained the matter to Dr Ang and thank him for his feedback.

Businesses that require more information or assistance on claiming PIC can refer to www.iras.gov.sg or contact us at [email protected] or 1800 356 8622 (for companies) / 6351 3534 (for self-employed/partnerships). Businesses are also encouraged to sign up for the IRAS PIC seminars in April 2014 or the PIC Clinics.

Walter Lim
Director (Corporate Communications)
Inland Revenue Authority of Singapore