Double Tax Deduction for Internationalisation

Companies planning to expand overseas can benefit from the DTDi tax deduction scheme with a 200% tax deduction on eligible expenses for international market expansion and investment development activities

DTDi supports activities across key stages of a company's overseas growth journey

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About this programme

Companies planning to expand overseas can benefit from the Double Tax Deduction Scheme for Internationalisation (DTDi), with a 200% tax deduction on eligible expenses for international market expansion and investment development activities.

DTDi supports activities across key stages of a company's overseas growth journey, including:
Please refer here for a full list of qualifying activities and expenditure available for DTDi.

Please refer here for the list of approved local trade publications, list of approved virtual trade fairs and the list of standards and certifications approved by EnterpriseSG.

Automatic DTDi
You can automatically claim 200% tax deduction on the first S$150,000 of eligible expenses for nine activities per year of assessment. No prior approval from EnterpriseSG is required for the following activities:

Eligible expenses on qualifying activities outside the nine areas, and expenses exceeding S$150,000 will require EnterpriseSG's approval.
Note: Companies will need to apply to EnterpriseSG for qualifying expenses under overseas market development trips/missions and investment study trips/missions listed here:
- Fees paid to secure speaking spots at overseas business/trade conferences to pitch products/services to attendees
- Logistic costs of transporting materials/samples used during the overseas market development trips/missions and investment study trips/missions
- Third party consultant cost to arrange business networking events to promote products/services

Eligibility

Business entity resides in Singapore with a primary purpose of promoting the trade of goods or provision of services
Businesses enjoying discretionary incentives¹ may also be allowed to qualify for the DTDi scheme on a case-by-case basis, subject to approval by EnterpriseSG or the Singapore Tourism Board
- Incentivised businesses must have their global headquarters in Singapore, with the primary purpose of trading in goods or providing services, and have an intention to internationalise.
¹ Discretionary incentives refer to those under: (a) ITA - Sections 13A, 13E, 13P, 13S, 43C, 43D, 43E, 43G, 43I, 43J, 43L, 43P, 43Q, 43R, 43U, 43V, 43X or (b) Economic Expansion Incentives (Relief from Income Tax) Act – Part 2, 3, 4 and 8.
Project must meet the following key objectives:
- Promotes the company's new products and services to new target market(s)
- Identifies new customers in target market(s) for the company’s existing products and services
- Promotes the company’s new products and services to existing customers
- Promotes the company’s existing products and services to existing markets so as to increase market share
Applications must be submitted on the DTDi portal prior to starting the project.

Benefits of DTDi

The examples below illustrate potential tax savings through DTDi when an eligible expense is not an Allowable Business Expense¹ under the Income Tax.

Case 1: Company A spent S$10,000 to participate in an overseas tradeshow to reach out to its buyers in Europe

	Without DTDi support	With DTDi support
Revenue	S$100,000	S$100,000
DTDi eligible expense of S$10,000	(S$10,000)	(S$20,000)
Other expenses	(S$20,000)	(S$20,000)
Taxable income	S$70,000	S$60,000
Tax payable (@ 17% as of YA2015)	S$11,900	S$10,200
Savings from DTDi	N.A.	$1,700

Case 2: Company B posts a staff into an overseas subsidiary to drive its marketing efforts in-market. Staff basic salary is $2,000 per month.

	Without DTDi support	With DTDi support
Revenue	S$100,000	S$100,000
DTDi eligible expense of S$2,000 x 12 months	N.A. (If the expense is not deductible under S14 of the Income Tax Act)	(S$48,000)
Other expenses	(S$20,000)	(S$20,000)
Taxable income	S$80,000	S$32,000
Tax payable (@ 17% as of YA2015)	S$13,600	S$5,440
Savings from DTDi	N.A.	$8,160

¹ Allowable expenses generally relate to expenses incurred and related to the specified business. For more details please refer to IRAS website.

How to apply

Please refer here if you are new to Enterprise Singapore Incentive Management System (ESIMS).

Submit application online

Submit your application online with your Corppass for activities:

that do not fall under automatic DTDi
with quantum exceeding the first S$150,000 for that year of assessment under automatic DTDi

Applications must be submitted before project commencement.

Application process

We will process your application upon receipt of complete information. We may request for supporting documents to verify eligible expenses.

Submit evaluation forms

For approved applications, submit your evaluation forms upon project completion. We will thereafter proceed to issue a Letter of Support to support your claims with the Inland Revenue Authority of Singapore (IRAS).

Attach Letter of Support to IRAS

Attach the Letter of Support from EnterpriseSG to IRAS when filing the company's annual income tax return. All other relevant supporting documents (like invoices, receipts, etc), should be compliant and made available to IRAS upon request.

Assessment by IRAS

IRAS will assess if expenses submitted qualify for tax deductions.

View the detailed DTDi ESIMS Userguide here.

Claims

After completing the project, you should submit the Evaluation Form for Enterprise Singapore to issue the Letter of Support for your claims with IRAS.

Companies are not required to submit upfront documentation to IRAS for expenditure not exceeding S$150,000. You will, however, need to produce documentation as proof of expenditure and purpose, should IRAS request. These include the purpose and itinerary of the trip, list of companies met, invoices and receipts of the qualifying expenses.