Singapore’s 2025 Budget introduces powerful enhancements to its corporate tax incentives—creating a competitive edge for M&A-driven growth, international expansion, employee retention, and innovation. If your company is eyeing global scaling or setting up a high-value hub in Asia, now is the time to act.

What’s New and Extended?

In today’s global uncertainty, Singapore has implemented significant new tax changes aimed at supporting its future and sustainability, businesses, and individuals.

Corporate income tax updates in Singapore Budget 2025

Extension of corporate income tax (CIT) rebate and the Rebate Cash Grant for year of assessment (YA) 2025:

● The CIT rebate of 50% of tax payable will be extended for companies for the YA 2025. Additionally, eligible companies that have employed at least one local employee in 2024 will receive a minimum benefit of $2,000 SGD in the form of a cash payout (CIT Rebate Cash Grant).

● The maximum total benefits of the CIT rebate and Rebate Cash Grant that a company may receive is $40,000 SGD.

Extension of double tax deduction for internationalization (DTDi) scheme:

● Tax deduction of 200% on qualifying market expansion and investment development expenses under the DTDi scheme will be extended until December 31, 2030.

Enhancement of non-taxation of companies’ disposal gains (Section13W of Singapore Income Tax Act (SITA)):

● For better certainty, the Inland Revenue 

Authority of Singapore (IRAS) has removed the S13W sunset date with enhancements as follows. Expanded the scope of eligible gains from disposal of preference shares accounted as equity by investee company under applicable accounting principles.

○ Allowed assessment of shareholding threshold condition on a group basis.

● These changes will take effect for disposal gains derives on or after January 1, 2026.

Introduction of tax deduction for issuance of new shares of holding company under EEBR schemes:

● Companies will now be allowed to claim tax deduction payments to the holding company or a special purpose vehicle (SPV) for newly issued shares of the holding company under the EEBR scheme.

● The changes will take effect from YA 2026.

Introduction of a new tax incentive—tax exemption on fund managers’ qualifying income arising from funds investing substantially in Singapore-listed equities:

● To support fund managers to launch and manage qualifying funds that invest substantially in Singapore-listed equities, a corporate tax exemption on income arising from such funds will be introduced under the Financial Sector Incentive–Fund Management (FSI-FM).

● The tax incentive schemes are provided to all Singapore fund managers meeting certain criterion for qualifying funds. Tax exemption would be granted for fees earned from fund management and investment advisory activities related to qualifying funds. The award tenure period would be five years per fund managed by fund manager (non-renewable) open for award until December 31, 2028.

Personal income tax and GST changes for 2025

Increase in personal income tax rebate for YA 2025:

● A personal income tax (PIT) rebate of 60% of tax payable will be granted to all tax resident individuals for YA 2025, capped at $200 SGD per taxpayer.

Goods and services tax Extension of goods and services tax (GST) 

remission for qualifying funds, real estate investment trusts (REITs), and Singapore-listed registered business trusts (RBTs) in the infrastructure business, ship leasing, and aircraft leasing sectors.

Apart from the announcement of the extension of GST remission for Singapore REITs and RBTs until December 31, 2030 that were previously scheduled to lapse after December 31, 2025, funds (including variable capital companies) when fund procures services (e.g., fund management service) from GST registered business will be granted GST remission until December 31, 2029.

In summary: Singapore Budget 2025 tax changes to know

● CIT:50% CIT rebate extended, new tax deduction for share issuance

● PIT: 60% PIT rebate, capped at $200 SGD

● GST: GST remission extended for funds, REITs, and registered business trusts

✅ M&A Tax Allowance Extended to 2030

Acquire with confidence. Eligible merger & acquisition deals can continue to enjoy stamp duty relief and tax allowances—supporting strategic consolidation and market expansion.

✅ Double Tax Deduction for Internationalization (DTDi)

Your overseas marketing and business development costs now work double for you. Enjoy 200% tax deductions for eligible international expansion expenses.

✅ Enhanced Tax Deductions for Employee Equity Plans

Rewarding talent just got more rewarding. Employee share-based remuneration plans are now more tax-efficient—helping you attract and retain top performers in a competitive market.

✅ Full Deductibility for R&D Collaboration

Fuel your innovation engine. Companies working with local research institutes and universities can now enjoy 100% tax deductions on qualifying R&D collaboration costs.

Who Should Pay Attention?

● High-growth companies planning cross-border expansion

● Startups and scaleups using M&A for strategic growth

● Multinational enterprises (MNEs) with international headquarters in Singapore

● Tech, biotech, and advanced manufacturing firms investing in R&D and talent

Why Singapore?

As a gateway to Asia with pro-business policies, robust legal infrastructure, and a growing innovation ecosystem, Singapore continues to lead as the ideal destination for global business operations.

With these refreshed tax incentives available until 2030, businesses have a long runway to plan bold, strategic moves—with real fiscal benefits.

🔎 Interested in optimizing your global tax position or planning your next expansion move?

Let’s talk. Our cross-border tax experts can help you navigate compliance while maximizing incentives.