- Corporate income tax support
- Enhanced Job Support Scheme
- Relief in the form of loans
- Ministry of Manpower support
- Central Provident Fund Board support
- Foreign worker support
- Employer leave options
- Options for employees
On 3 April, in light of the increased transmission of COVID-19, Prime Minister Lee Hsien Loong announced a month-long lockdown. With most businesses being unable to operate until 4 May, this will likely cause strain on a lot of companies and households.
In this blog, we shall give information on relief options available to help support your business and its employees over the lockdown period.
Comprehensive information about each of the support measures available is provided in this booklet, which lays out all of the schemes detailed in the Unity, Resilience and Solidarity Budgets.
Support for Businesses
Support Provided by Inland Revenue Authority of Singapore
As announced in the Resilience Budget on 26 March and the Solidarity Budget on 6 April 2020, the Inland Revenue Authority of Singapore will be implementing a series of support measures to ease financial pressure on businesses.
Automatic Deferral of Corporate Income Tax (CIT)
All companies due to make CIT contributions in April, May or June will be granted an automatic 3 month deferment. If you use GIRO then this will be reflected in the “my tax portal” section, providing you with a new due date. If you are not using GIRO, please use the Corporate Tax Payment Deferment Calculator, to determine the new date for payment.
Should you want further information or if you do not wish to defer your CIT, please refer to the IRAS web page here.
Corporate Income Tax Rebate
In the Government’s Stabilisation and Support Package from 18 February, they announced that there would be a 25% rebate on corporate income tax, up to a maximum of $15 000.
Enhanced Job Support Scheme (JSS)
The Job Support Scheme (JSS) was launched to help businesses retain their local employees during this period of uncertainty. The below Budgets make provision for this:
- Solidarity Budget – wage subsidy raised for all sectors to 75% of gross monthly wages for the first $4,600 of wages paid to all local employees (citizens and permanent residents) in April 2020.
- Resilience budget – Depending on which of the three tiers your business sector fits into, you can expect a grant of 25%, 50% or 75% of your gross wages for the first $4,600 of wages paid to all local employees. This scheme shall run for 9 months, from October 2019 to July 2020. Payments can be expected in three tranches in April, July and October 2020.
A great feature of the scheme is that employers do not need to apply for JSS, it is calculated automatically from the CPF contributions. Therefore you can expect this subsidy to support your business over this period.
For more information on this support measure and to see which grant bracket your business fits into, please refer to the IRAS information page here.
Relief in the Form of Loans
Unity Budget – 18 February
- Enterprise Finance Scheme (EFS) – In the Stabilisation and Support Package it was announced that loans of up to $600 000 would be provided to SMEs in the form of working capital.
Resilience Budget – 26 February
- Temporary Bridging Loan Programme – This programme has been extended to all sectors, with the maximum amount now being $5 Million.
- Enterprise Finance Scheme (EFS) – The maximum loan quantum for SME working capital was increased to $1 million.
- EFS Trade Loans – Trade loans were increased to a maximum of $10 million, whilst the Government also increased its risk share to 80% for these loans.
- Loan Insurance Scheme – Loan insurance premiums can be subsidised by up to 80% under this scheme.
Solidarity Budget – 6 April
- Government risk share – For the EFS-Trade Loans, EFS-SME Working Capital Loans and Temporary Bridging Loan Programme, The Government has increased its risk share to 90%.
Support Provided by the Ministry of Manpower (MOM)
In addition to the above, MOM has released several support programmes for businesses. For more information on all of the schemes mentioned below, please follow this link.
For business employers with foreign workers, information on:
- Levy rebate and levy waiver for business employers
- 3-month extension of levy payment timeline for SMEs
- Transfer foreign workers across sectors to manage manpower needs
- Refund of Man-Year Entitlement (MYE) for constructions firms
- Temporary Housing Support for employers affected by Malaysia’s MCO
For business employers affected by Leave of Absence (LOA) or Stay Home Notices (SHN), further information on:
- LOA/SHN Support Programme for employers in healthcare, education and eldercare sectors
- LOA/SHN Support Programme for employers in all other sectors
- LOA/SHN Support Programme for employers implementing company-imposed LOA
For business employers implementing a flexible work arrangement (FWA), further information on:
- Enhanced Work-Life Grant (WLG) for flexible work arrangements
For Self Employed Persons (SEPs), further information on:
- LOA/SHN Support Programme for SEPs in healthcare, education and eldercare sectors
- LOA/SHN Support Programme for SEPs in all other sectors
- LOA/SHN Support Programme for SEPs on self-imposed LOA
For Foreign Domestic Worker (FDW) employers, further information on:
- SHN support for FDW employers
Support Provided by the Central Provident Fund (CPF) Board
The Unity, Resilience and Solidarity budgets made for several support measures that the CPF can provide. These are explained in more detail on the CPF Website.
These budgets have made provision for three cash payouts for Singapore citizens:
- The Solidarity Budget is to automatically pay $600 to each adult Singapore citizen in April 2020. More information is found in the CPF website linked above.
- The Resilience budget will pay adult Singapore citizens over the age of 21 a further payment in the form of the Care and Support Package. This will be paid out in June 2020. More information on the amounts can be found in this infographic, under “Supporting Families”.
- The Workfare Special Payment Package is also available as a cash payout of up to $3000 for Singapore citizens who received workfare payments for work done in 2019.
If you are a permanent resident with an immediate family member who is a Singapore citizen, you can also receive the Solidarity Budget cash payout. In order for this you must apply through go.gov.sg/sppr.
Additionally, this page covers a special allowance for remote working, which are not subject to CPF.
Leave Options for Employers if employees are unable to work
Regardless of all the support measures put in place, in some situations it is not practicable to continue business operations during the lockdown, meaning that employees will need to be put on leave.
Where employees are able to work, but are prevented from doing so due to the lockdown, employers and employees can agree that annual leave be used to cover some or all of the lockdown period on full pay. You are also always able to extend extra paid leave days to all employees should you so wish.
Where none of the paid leave types are an option, if it is possible to find an agreement between the employer and employees, instead of ending the employees service you can form a special leave type on SimplePay. For further information on creating a custom leave type on SimplePay, please visit our help page here.
If it is agreed that the employee is not to be paid during this period, it may be beneficial to direct them to the table in this link. The Key Scheme labelled “Temporary Assistance” can provide some money for them in the interim.
Options for Employees
Deferment of Tax Payment
If your employee pays tax under the GIRO or lump sum method, they are entitled to apply to defer tax by 3 months.
- For employees paying tax under GIRO, you can opt to defer your tax due in May, June and July 2020. In order to partake in this scheme they must sign up by 31 July 2020. They can sign up for the deferment here.
- For employees due to pay tax as a lump sum in May, June or July 2020, they can also defer payment by 3 months.
For more information on deferments of employee tax, please follow this link.
Taxpayers who need help with tax payment
If as a result of the COVID-19 pandemic you are in financial difficulty and are struggling to pay taxes, you can directly apply for a longer payment plan on GIRO, under “my payment plan”, which can be found in the “My tax portal”.
If a deferment is going to prove insufficient and you require other forms of help, IRAS encourages you to get into contact with them, where they will consider applications on a case by case basis.
This is just a summary of some of the options available to support businesses and employees. For the comprehensive list of support available, we would recommend that you read through the linked booklet at the top of the blog.
Should you have any questions on this blog, please feel free to get in contact with our support team at [email protected]
Keep well. Stay home. Stay safe.