You can claim deduction for expenses that are incurred in the production of income. It must also be revenue in nature; the deduction must not be prohibited under the Income Tax Act; and the expenses must be incurred. Examples of deductible and not deductible expenses:
| Deductible expenses | Not deductible expenses |
|---|---|
| Accounting fee Administrative expenses Advertisement Auditors’ remuneration |
Amortisation |
| Bad debts (trade debtors) Bank charges Book-keeping services |
Bad debts (non-trade debtors) |
| Commission CPF, skill development levy, foreign workers’ levy |
CPF contributions (Voluntary*) Certificate of entitlement (COE) for motor vehicles** |
| Directors’ fees Directors’ remuneration |
Depreciation (you may claim capital allowances) Donations |
| Entertainment Exchange loss (trade and revenue in nature) Exhibition expenses |
Entrance fee (country club or other clubs) Exchange loss (non-trade or capital in nature) |
| Fixed assets written off Fixed assets acquisition cost Fines |
|
| Goodwill payment | |
| Impairment loss on trade debts Insurance (e.g. fire, workmen compensation) Interest expenses |
Impairment loss on non-trade debts Income tax Installation of fixed assets Insurance (certain life insurance) Interest expenses (interest adjustment) |
| Legal and professional fees (trade and revenue transactions) | Legal and professional fees (non-trade or capital transactions |
| Medical expenses (restricted to 1% of total remuneration) Motor vehicle expenses (goods / commercial vehicles, e.g. van, lorry and bus) |
Medical expenses (amount exceeding 1% of total remuneration) Motor vehicle expenses (“S” plate private passenger cars) |
| Office upkeep | |
| Periodicals & newspapers Postage Printing & stationery Property tax Provision for bad and doubtful debts (specific)(note impairment loss on trade debts) Provision for obsolete stocks (specific) |
Penalties Preliminary expenses Private and domestic expenses Private hire car Provision for bad and doubtful debts (general)(note impairment loss on trade debts) Provision for obsolete stocks (general) |
| Rental of business premises Repairs and maintenance Restoration costs (according to tenancy agreement) Research and development |
Renovation or refurbishment works (you may claim Section 14Q deduction for qualifying expenditure incurred from 16 Feb 2008 to 15 Feb 2013) |
| Secretarial fees Staff remunerations (salary, bonus and allowances) Staff training Staff welfare/benefits Stock obsolescence |
|
| Tax fees (service fees paid to tax agent) Telephone Transport (public transport and goods / commercial vehicles) Travelling |
Transport (“S” plate private passenger cars) |
| Wages Water & electricity |
