1. If your business has incurred expenses to renovate or refurbish the business premises, you can claim tax deduction on this expenses under Section 14N of the Income Tax Act 1947. Please do note that only businesses that are carrying on a trade or business can claim this Section 14N deduction. Investment holding companies cannot claim this Section 14N deduction.
2. The following items qualify for tax deduction, provided that they do not affect the structure of the business premises:
- General electrical installation and wiring to supply electricity
- General lighting
- Hot/ cold water system (pipes, water tanks, etc.)
- Gas system
- Kitchen fittings (sinks, pipes, etc.)
- Sanitary fittings (toilet bowls, urinals, plumbing, toilet cubicles, vanity tops, wash basins, etc.)
- Doors, gates and roller shutters (manual or automated)
- Fixed partitions (glass or otherwise)
- Wall coverings (such as paint, wallpaper, etc.)
- Floorings (marble, tiles, laminated wood, parquet, etc.)
- False ceilings and cornices
- Ornamental features or decorations that are not fine art (mirrors, drawings, pictures, decorative columns, etc.)
- Canopies or awnings (retractable or non-retractable)
- Windows (including the grilles, etc.)
- Fitting rooms in retail outlets
- Hacking work on premises
- Water meter installed to enable renovation works
- Hoarding works
- Insurance for renovation works qualifying for Section 14N deduction
3. However, do take note that tax deductions are not allowed on expenditure relating to:
- Antiques
- Fine art including painting, drawing, print, calligraphy, mosaic, sculpture, pottery or art installation
- Works carried out to a place of residence provided to or to be provided to employees
4. The tax deduction for renovation or refurbishment expenditure is capped at $300,000 for every relevant 3-year period. You are not allowed to claim the remainder amount if your total renovation or refurbishment expenses exceed $300,000. However, you may claim capital allowances instead for for costs incurred on furniture (e.g. cabinets, shelves, venetian blinds, carpets, movable workstation partitions).
5. Businesses have the option to claim a 1-year write off or 3-year write off for the renovation or refurbishment expenditure incurred. Section 14N deduction cannot be deferred. The balance of the Section 14N deduction yet to be claimed is not allowed as a tax deduction in the subsequent year of assessments.
8. Contact us if you require assistance to claim tax deduction on Renovation or Refurbishment Expenses incurred to your business premises. At PL Biz Consulting Pte Ltd, we have the right people and expertise to compute the correct amount of tax deductions that your business can claim to reduce the amount of tax payable.
