PRODUCTIVITY AND INNOVATION CREDIT BONUS

Last updated on February 28, 2013 OVERVIEW: PIC BONUS About PIC Bonus The Productivity and Innovation Credit (PIC) Bonus gives businesses a dollar-for-dollar matching cash bonus for YAs 2013 to 2015, subject to an overall cap of $15,000 for all 3 YAs combined. This is given on top of the existing 400% tax deductions/allowances and/or 60% cash payout (223PIC cash payout224) under the PIC scheme. To enjoy the PIC Bonus, businesses must have made a claim for the 400% tax deductions/allowances and/or the PIC cash payout. The PIC Bonus is taxable.

Last updated on February 28, 2013 QUALIFYING CONDITIONS Qualifying Conditions Businesses eligible for the PIC Bonus are sole-proprietorships, partnerships and companies that have: during the basis period for the YA in which a PIC Bonus is claimed; active business operations in Singapore; and at least 3 local employees (Singapore citizens or Singapore permanent residents with CPF contributions) excluding sole-proprietors, partners under contract for service and shareholders who are directors of the company.

Last updated on February 28, 2013 COMPUTING PIC BONUS YA 2013 YA 2014 YA 2015 Qualifying PIC Expenditure $5,000 $5,000 $5,000 OPTION 1: PIC Cash Payout $3,000 ($5,000 x 60%) $3,000 ($5,000 x 60%) $3,000 ($5,000 x 60%) OPTION 2: PIC Tax Credit $3,400 tax deduction ($5,000 x 68%) $3,400 tax deduction ($5,000 x 68%) $3,400 tax deduction ($5,000 x 68%) PIC Bonus $5,000 $5,000 $5,000 Total PIC Benefits $8,000 $8,000 $8,000 or $8,400 or $8,400 or $8,400 You will receive an equal amount in PIC bonus on every dollar that you spend on qualifying activities, subject to a cap of $15,000 over YAs 2013 to 2015. NOTE: Choose Option 1 if your business is not currently profitable or if you want a cash payout. Choose Option 2 if your business is profitable to reap the maximum tax credit. 1 1 1 2 2 2

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