Engaging Consultants to File PIC Claims
For companies
Simple and Straightforward PIC Claim Procedure
The application processes for Productivity and Innovation Credit (PIC) are kept simple and straightforward
for businesses, particularly small and medium enterprises (SMEs). Most SMEs filed their PIC claims
themselves, but there are some businesses that engage PIC Consultants to assist them in claiming PIC
benefits. These consultants may charge a fee for their services.
What Businesses Need to Look Out for When Engaging Consultants to File PIC Claims
Regardless of whether businesses file the PIC claims on their own or with the help of consultants,
businesses are ultimately responsible for the accuracy of the claims.
Businesses that wish to engage PIC Consultants are advised to engage those who are competent and able
to provide the correct advice. IRAS recommends that businesses obtain the PIC Consultants’ advice in
writing, verify the accuracy of the information in the application form (e.g. ensure that the description of
the PIC item and the amount incurred stated in the form match those in the invoices, etc.) before
submitting the application to IRAS.
Common Mistakes to Avoid
In the course of reviewing PIC claims, IRAS has identified several common mistakes made by some PIC
Consultants. We encourage businesses to take note of these common mistakes and the correct procedures
to submit the PIC claims, as shown below.
Common Mistakes on PIC Claims
Correct Procedures
Submitting incomplete PIC cash payout application
forms
All cash payout application forms are to be properly
completed and duly signed.
Example
•
The revenue figure in the application form is
blank;
•
The form is not signed.
Claiming both PIC cash payout and 400% tax
deduction on the same PIC expenditure
Example
Submitting a claim for PIC cash payout on training
expenditure of $10,000 and making a separate claim
for 400% tax deduction on the same training
Businesses can opt to either convert qualifying
expenditure into cash payout or claim the 400% tax
deductions against their income. Businesses cannot
claim both enhanced tax deductions and cash
payouts on the same expenditure.
expenditure in the income tax return.
Claiming for expenditure on equipment that does
not fall under the PIC IT and Automation Equipment
List
Example
Submitting a PIC claim for basic telephones,
furniture and audio equipment
Claiming for non-qualifying expenditure
Businesses can only claim for expenditure on
prescribed IT and automation equipment, i.e.
equipment in the PIC IT and Automation Equipment
List .
If the equipment is not in the list, businesses must
apply to IRAS for it to be approved, on a case-by
case basis, before making a claim for PIC on that
equipment.
Claims should only be made on qualifying
expenditure.
Example
Some non-qualifying expenditure include:
•
GST paid by a GST-registered trader on an
item that qualifies for PIC (GST component is
not claimable for income tax purpose as the
GST trader can claim input tax in its GST
return)
•
Expenditures that are not applicable to the
IT and automation equipment such as
warranty fees and service maintenance fees
•
Consultancy fees and PIC audit fee claimed
as training expenditure
Insufficient records to substantiate claims
Example
Some companies have not been able to furnish
documents to support their claims, when requested,
such as:
•
Evidence of payment, e.g. bank statement
•
Invoices
•
CPF payment records
Businesses are required to maintain all supporting
documents for a period of 5 years. These should be
submitted to IRAS upon request.