Start-Up Tax Exemption (SUTE): What New Singapore Companies Actually Get
Start-Up Tax Exemption (SUTE): what new Singapore companies actually get The practical conclusion first: if you’ve just incorporated a Singapore company, you may pay far less corporate tax in your first three years than you expect. Under the Tax Exemption Scheme for New Start-Up Companies (often called SUTE), a qualifying company generally gets 75% exemption on its first $100,000 of normal chargeable income, plus a further 50% on the next $100,000 — a maximum exemption of $125,000 each Year of Assessment (YA) — for its first three consecutive YAs. The catch is that not every company qualifies, and the exemption is not automatic to keep if your facts change. Here’s what SME founders need to know, subject to your company’s specific facts and IRAS rules. How much is the exemption? For YA 2020 onwards, a qualifying start-up’s exemption works like this (IRAS): First $100,000 of normal chargeable income — 75% exempt ($75,000) Next $100,000 — 50% exempt ($50,000) Maximum exemption: $125,000 per YA “Normal chargeable income” is income taxed at the prevailing corporate tax rate of 17%. The scheme applies only for your first three consecutive YAs. From the fourth YA onwards, your company moves to the Partial Tax Exemption (PTE) instead (more on that below). Who qualifies? To claim SUTE, your new start-up company must generally (IRAS): Be incorporated in Singapore; Be a tax resident of Singapore for that YA; and Have its total share capital beneficially held directly by no more than 20 shareholders throughout the basis period for that YA, where either all shareholders are individuals, or at least one shareholder is an individual holding at least 10% of the issued ordinary shares. Setting this up correctly from day one matters — our company incorporation team can structure your shareholding with SUTE in mind. Which companies are excluded? Most genuine trading and services SMEs qualify — but two types of company are excluded from SUTE (IRAS): Companies whose principal activity is investment holding; and Companies that undertake property development for sale, investment, or both. If your company falls into either group, it doesn’t get SUTE — but it may still be eligible for the Partial Tax Exemption. What happens after year three? (Partial Tax Exemption) From the fourth YA onwards, companies move to the Partial Tax Exemption (PTE), which is available to companies generally (unless they’re still claiming SUTE) (IRAS): First $10,000 — 75% exempt ($7,500) Next $190,000 — 50% exempt ($95,000) Maximum exemption: $102,500 per YA Don’t forget the Corporate Income Tax Rebate Separately from the exemption schemes, IRAS granted a Corporate Income Tax Rebate of 50% of tax payable for YA 2025, capped at $40,000 (less any $2,000 CIT Rebate Cash Grant where applicable) — the same as YA 2024 (IRAS). Rebates like this are announced year by year, so check the current YA’s position before relying on it. Common mistakes we see Assuming you qualify without checking the shareholder test. A single corporate shareholder holding everything can break the “at least one individual holding 10%” condition. Investment holding structures. Founders sometimes set up a holding company and are surprised it’s excluded from SUTE. Miscounting […]
Read moreDigital Bookkeeping vs the “Shoebox”: Why Singapore SMEs Are Making the Switch
Still handing over a shoebox of receipts once a year? See how digital, cloud-based bookkeeping keeps Singapore SMEs compliant and in control all year round.
Read moreWhat Happens If You Miss the ACRA Annual Return? (Singapore SME Guide)
If you have missed your company’s ACRA annual return (AR), file it as soon as possible. A late lodgement penalty of S$300 applies if you file within three months after the due date, and S$600 if you file more than three months late (ACRA). The penalty is calculated automatically on BizFile when you submit, so the longer you wait, the more it costs — and continued default can escalate to enforcement action against directors. The good news: for most SMEs this is fixable, and filing now stops the situation getting worse. What the annual return actually is The annual return is a yearly filing every Singapore company must lodge with ACRA confirming key company information — directors, shareholders, registered address, and (where required) financial statements. It is separate from your tax filing with IRAS. Many first-time business owners assume “I filed my taxes, so I’m done” — but ACRA and IRAS are two different obligations with two different deadlines. When the annual return is due For a non-listed company (which covers most SMEs), the AR must generally be filed within 7 months after your financial year end (FYE) (ACRA). If your company has a share capital and keeps a branch register outside Singapore, the deadline is 8 months. A related requirement: private companies must generally hold their AGM within 6 months after FYE, unless the company is exempt from holding an AGM (ACRA). A quick example: if your FYE is 31 December 2025, your AR filing deadline is generally 31 July 2026. File on 20 August 2026 (20 days late) and the penalty is S$300. The penalties, in plain terms For filing due dates on or after 14 January 2022, ACRA applies a simple two-tier late lodgement penalty (ACRA): Up to 3 months late: S$300 More than 3 months late: S$600 This penalty is charged per company, per late annual return, and is applied automatically at the point of lodgement on BizFile. It can get worse than a fee A late penalty is the first consequence, not the last. Where a company keeps defaulting, ACRA may take further enforcement action — including offering a composition sum, prosecution, disqualification or debarment of directors, and ultimately striking the company off the register (ACRA). A debarred director cannot be appointed to act as a director or secretary of another company while the order stands. In other words, ignoring the AR does not just cost the company — it can follow the individual director. One more practical trap: you cannot change your FYE once the filing deadline for the AGM, AR, or financial statements has already passed (ACRA). So missing the deadline can quietly remove options you might have wanted later. What to do if you have missed it File now, don’t wait. The penalty jumps from S$300 to S$600 once you cross three months late, so filing sooner directly saves money. Get your information in order — updated director and shareholder details, registered address, and financial statements if your company is required to file them. Consider an extension only before the deadline. ACRA allows a 60-day extension of time to file, but it […]
Read moreGST InvoiceNow in Singapore: What It Is, When It Applies, and How to Get Ready
GST InvoiceNow is rolling out in phases from 2025 to 2031. Find your date, understand what changes, and see how BTA helps your business get ready.
Read moreCorporate Income Tax Filing YA 2026: The 30 November Deadline Every Singapore Company Should Know
Your YA 2026 Corporate Income Tax Return is due 30 Nov 2026 — even if dormant or loss-making. Here’s what Singapore companies must file, and how BTA helps.
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10 Best Accounting Software for Small Businesses in Singapore
Running a small business in Singapore demands focus and action—chasing every dollar shouldn’t wear you down. With the right accounting software for small businesses in Singapore, you can manage invoices, track expenses, and stay compliant with tax rules effortlessly. These tools speed up routine tasks, reduce errors, and keep your records well-organised. They also provide clear insights into your cash flow and overall business performance. With just a few clicks, you can monitor balances, control spending, and stay on top of payments. Below, we highlight 10 smart tools that simplify accounting and give you greater control. These options help keep your finances steady, so your business is prepared for whatever comes next. Why Accounting Software Matters Owning a small business in Singapore comes with many responsibilities, but managing your finances doesn’t have to be complicated. The right accounting software for small businesses in Singapore makes it easy to track expenses, send invoices, and stay compliant with tax regulations. These tools save time, minimise errors, and give you a clear picture of your business performance. You can monitor payments, expenses, and reports—all from one convenient platform. Below are 10 reliable software options for small businesses in Singapore that help you stay organised and focus on growth. 1. Xero With top-notch accounting services in Singapore, Xero offers a clean interface and powerful tools for small business owners. You can send invoices, track payments, and automatically sync your bank transactions to keep records up to date. The system also helps you stay on top of tax filings, with built-in support for IRAS GST compliance. Xero’s cloud access allows you to manage finances from any device, and it integrates with over 1,000 apps—from payroll to eCommerce platforms. While some users report occasional delays in bank syncing, Xero remains one of the most trusted solutions for small businesses in Singapore. 2. Dext Software Dext is an AI-powered financial management tool designed to automate and simplify accounting processes like data entry, expense categorization, and real-time financial tracking. It replaces manual bookkeeping tasks and gives businesses full control over their finances—anytime, anywhere. Originally popular in the UK, Dext is now available in Singapore through a partnership with Business Tax Accountancy (BTA). 3. QuickBooks QuickBooks allows business owners to create custom invoices, track sales, and generate instant reports. You can snap photos of receipts and store them directly in the app. It connects to your bank account, reducing the need for manual entries. The mobile app lets you handle tasks on the move. It may take time to learn the interface, but once mastered, it becomes a strong part of your business tools. 4. ABSS (formerly MYOB) ABSS supports inventory tracking, custom invoicing, and purchase recording. Its interface suits small business owners who want reliability. It offers a one-time software license without recurring fees. Though it doesn’t have a mobile app, ABSS still functions well for desktop users. It suits businesses needing more control over sales, stock, and reporting. 5. Financio Financio creates a simple way for businesses to manage finances. You can switch languages easily, send e-invoices, and access everything on mobile or desktop. The platform comes […]
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