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Industry Insights

Enhanced Support For Businesses & Self-employed

Posted on 20/04/2020 by PrimeHR

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As announced on 26 March and 6 April 2020, the Government will enhance measures under the Stabilisation and Support Package that was first introduced at Budget 2020. This will provide greater assurance and support to workers and enterprises in this time of economic uncertainty. In addition to providing cash flow support, the Package supports firms to retain and retrain workers, and share productivity gains with them. Sectors more directly affected by the COVID-19 outbreak will receive additional support.

Economy-wide measures for workers

1) Jobs Support Scheme

The Jobs Support Scheme (JSS) will help enterprises retain their local employees (Singapore Citizens and Permanent Residents) during this period of economic uncertainty.

The government will co-fund the first $4,600 of gross monthly wages (includes employee CPF contributions but excludes employer CPF contributions) to each local employee for nine months. There are three levels of co-funding for employers in different sectors, as shown in the table below.

In addition, wage support for the month of April 2020 will be topped up to 75% for all sectors to support firms during the ‘circuit breaker’ period. Wage support for other months will remain unchanged as per the table below.



JSS will support the following groups of employers:

JSS will provide support of:

Tier 1 Aviation and Tourism
  • Airlines
  • Airport ground handlers
  • Airport operators
  • Qualifying licensed hotels
  • Qualifying licensed travel agents
  • Qualifying gated tourist attractions
  • Cruise lines
  • Cruise terminal operators
  • Purpose built Meetings, Incentives, Conferences, and Exhibition venue operators
75% of the first $4,600 of gross monthly wages per local employee
Tier 2 Food Services
  • Licensed food shops and food stalls (including hawker stalls)
50% of the first $4,600 of gross monthly wages per local employee
Tier 3 All other sectors
  • All other employers
25% of the first $4,600 of gross monthly wages per local employee


The table below shows a worked example of how the JSS payout is computed for an employer with three local employees earning different wages.

Local Employee

Gross Monthly Wages paid in Month X

Qualifying Wage in Month X (first $4,600)

JSS payout to employer for Month X, if employer is in…

Tier 1 (75%) Aviation & Tourism

Tier 2 (50%) Food Services

Tier 3 (25%) All other sectors

Employee #1

$4,000

$4,000

$3,000

$2,000

$1,000

Employee #2

$4,500

$4,500

$3,375

$2,250

$1,125

Employee #3

$5,000

$4,600

$3,450

$2,300

$1,150

Total

$9,825

$6,650

$3,275


Month X in the table above excludes April 2020, for which the JSS support levels will be 75% for all sectors, equivalent to Tier 1.

Employers will receive three JSS payouts in April, July, and October 2020, covering wages paid in the months shown in the table below.

Payout

When will my firm receive?

JSS will cover wages paid in:

CPF contributions must be made by:

1st Payout

Apr 2020

Oct-Dec 2019

14 Feb 2020

2nd Payout

Jul 2020

Feb-Apr 2020

31 May 2020

3rd Payout

Oct 2020

May-Jul 2020

14 Aug 2020


For the April 2020 top-up to the JSS, this top-up will first be computed based on wages paid in October 2019. This enhancement will be paid out along with the first payout in April 2020. Subsequent JSS payouts will be adjusted to account for actual wages paid in April 2020 compared to October 2019, as shown in the table below.


Payout

Date of Payment

Food services

Others
(excluding aviation, tourism, food services)

Computation of Payout
for first $4,600 of gross monthly wages Based on:

Payout 1

Apr 2020

+ 75% of Oct 2019 wages
+ 50% of Nov 2019 wages
+ 50% of Dec 2019 wages

+ 75% of Oct 2019 wages
+ 25% of Nov 2019 wages
+ 25% of Dec 2019 wages

Payout 2

Jul 2020

+ 50% of Feb 2020 wages
+ 50% of Mar 2020 wages
+ (75% of Apr 2020 wages
– 25% of Oct 2019 wages)

+ 25% of Feb 2020 wages
+ 25% of Mar 2020 wages
+ (75% of Apr 2020 wages
– 50% of Oct 2019 wages)

Payout 3

Oct 2020

+ 50% of May 2020 wages
+ 50% of Jun 2020 wages
+ 50% of Jul 2020 wages

+ 25% of May 2020 wages
+ 25% of Jun 2020 wages
+ 25% of Jul 2020 wages

2) Self-Employed Person Income Relief Scheme

In fighting the “moving target” that is the coronavirus pandemic, the Singapore government’s priority is to save jobs and protect Singaporeans’ livelihoods. Thus, eligible Singaporean SEPs will receive $1,000 a month, for 9 months.

Eligible SEPs will receive 3 quarterly cash payouts of $3,000 each, in May, Jul and Oct 2020.

All SEPs who are currently receiving Workfare payouts will be automatically eligible for SIRS.

SEPs are also eligible if they:

  • Started work as an SEP on or before 25 March 2020
  • Do not also earn income as an employee
  • Earn a Net Trade Income of no more than $100,000
  • Live in a property with an annual value of no more than $13,000
  • Do not own 2 or more properties

For married SEPs, additional criteria apply:

  • The individual and spouse together do not own 2 or more properties
  • Assessable Income of the individual’s spouse does not exceed $70,000

• SEP Training Support Scheme

Introducing NTUC Training Fund (SEPs)

Leveraging the Government’s Self-Employed Person (SEP) Support Scheme and co-funded by the Government and NTUC, the NTUC Training Fund (SEPs) now allows SEPs to earn as they train. It also aims to support SEPs in deepening and/or acquiring new competencies during this lull period, in preparation for when the economy picks up and new opportunities arise.

How Can You Benefit From The Scheme?

The NTUC Training Fund (SEPs) is applicable for courses under the SkillsFuture Series and selected sector-specific training courses. The courses listed here are eligible for course fee subsidy, SkillsFuture Credit, and Training Allowance of at least $7.50 per hour.


Economy-wide measures to help business with cash flow

1) Corporate Income Tax (CIT) Rebate

To help companies with cash flow, a CIT Rebate of 25% of tax payable, capped at $15,000 per company, will be granted for Year of Assessment (YA) 2020.

2) Enhancements of Tax Treatments under the Corporate Income Tax System

These tax treatments will be enhanced under the corporate tax system for one year.

As announced in the Resilience Budget on 26 March 2020, all companies with CIT payments due in the months of April, May, and June 2020 will be granted an automatic three-month deferment of these payments. The CIT payments deferred from April, May, and June 2020 will instead be collected in July, August, and September 2020 respectively.

(Self-employed persons (SEPs) with personal income tax (PIT) payments due in the months of May, June, and July 2020 will be granted an automatic three-month deferment of these payments. The PIT payments deferred from May, June, and July 2020 will instead be collected in August, September, and October 2020 respectively.)

  1. a) Companies paying their CIT by GIRO can automatically enjoy an additional two months of interest-free instalments, when they file their Estimated Chargeable Income (ECI) within three months from their Financial Year End3. This automatic extension of instalment plan by two more months will apply to:
    1. Companies that file their ECI from 19 February 2020 to 31 December 2020;
    2. Companies that file their ECI before 19 February 2020, and have ongoing instalment payments to be made in March 2020.
  2. b) Allow up to $100,000 of the unabsorbed capital allowances and trade losses for YA2020 to be carried back up to three immediate preceding YAs, instead of one preceding YA;
  3. c) Provide an option to accelerate the write-off of the cost of acquiring plant and machinery (P&M) in financial year ending in 2020 (i.e. P&M acquired in the basis period for YA2021) over two years; and
  4. d) Provide an option to accelerate the deduction of expenses incurred on renovation and refurbishment (R&R) in financial year ending in 2020 (i.e. R&R done in the basis period for YA2021) in one year.

3) Enterprise Financing Scheme – SME Working Capital Loan and Trade Loan

The Enterprise Financing Scheme – SME Working Capital Loan (EFS-WCL), which is available to SMEs across all industries, will be enhanced from March 2020 to 31 March 2021 to help SMEs with their working capital needs. The Government will raise the maximum loan quantum to $1 million, and enhance the Government’s risk-share to 90% for loans initiated from 8 April 2020 to 31 March 2021 under the scheme.

Interested enterprises can apply directly to the Participating Financial Institutions.

The Enterprise Financing Scheme – Trade Loan (EFS-TL), supports Singapore-based enterprises’ trade financing needs, which include the financing of short-term import, export and guarantee needs. The EFS-TL, which is available to enterprises across all industries, will be enhanced for one year (from 1 April 2020 till 31 March 2021) to further help enterprises with their trade financing needs. The Government will raise the maximum loan quantum from $5 million to $10 million, and enhance the Government’s risk-share to 90% (from the current 50% to 70%) for loans initiated from April 2020 to 31 March 2021 under the scheme.

Interested enterprises can apply directly to the Participating Financial Institutions.

4) Loan Insurance Scheme 

The Loan Insurance Scheme (LIS) helps SMEs secure short-term trade loans by having commercial insurers co-share loan default with Participating Financial Institutions. A portion of the insurance premium paid by SMEs to insurers is supported by the Government. The Government will increase support for the LIS insurance premium from 50% to 80% for one year, (from 1 April 2020 to 31 March 2021), to help SMEs across all industries manage their trade financing costs.

Interested enterprises can apply directly to the Participating Financial Institutions.

5) Temporary Bridging Loan Programme for All Sectors

Administered by Enterprise Singapore, the Temporary Bridging Loan Programme (TBLP) was launched in March 2020 to provide additional cash flow support for tourism sector enterprises for one year (till 31 March 2021). The TBLP will be expanded to all sectors from 1 April 2020. The maximum loan quantum will also be increased to $5 million, with the interest rate capped at 5% p.a. The Government will provide 90% risk-share for loans initiated from 8 April 2020, to 31 March 2021 under the programme.

Interested enterprises can apply directly to the Participating Financial Institutions.


Sector-specific support

1) Property Tax Rebate for Non-Residential Properties

Non-residential properties will be granted a rebate for Property Tax (PT) payable for the period 1 January 2020 to 31 December 2020.

The property owner is required to pass on to his tenant the full amount of PT rebate attributable to the rented property, in a timely manner and unconditionally. The PT rebate is to be passed on by making a cash payment to the property owner's tenant, or by reducing or offsetting future rental payments.


Property tax payable for

Property tax rebate as announced at the FY 2020 Budget

Enhanced property tax rebate as announced at the FY 2020 Supplementary Budget

A) Hotel room or function room of a hotel registered under the Hotels Act

30%

100%

B) Serviced apartment or serviced apartment function room

C) Premises of the following that are used or intended to be used for Meetings, Incentive Travel, Conventions and Exhibitions (MICE):

  • Suntec Singapore Convention and Exhibition Centre;
  • Singapore EXPO; and
  • Changi Exhibition Centre.

D) All the premises of the following:

  • Changi Airport;
  • Singapore Cruise Centre;
  • Marina Bay Cruise Centre Singapore; and
  • Tanah Merah Ferry Terminal.

15%

E) Premises that are used or intended to be used as:

  • Backpackers’ hostel, boarding house, guest house or students’ hostel that is not a hotel;
  • Hotel that is not a registered hotel;
  • Shop or warehouse retail building;
  • Restaurant;
  • Sports and recreation building;
  • Amusement centre;
  • Cinema or theatre;
  • Medical clinic, hospital, nursing home, hospice, place of rehabilitation or convalescent home;
  • Childcare centre or kindergarten;
  • School;
  • Driving school;
  • Purpose-built workers’ dormitory; or
  • Tourist attraction.

F) All the premises of the following:

  • Marina Bay Sands; and
  • Resorts World Sentosa.

The above rates in (A) – (E) do not apply to Marina Bay Sands and Resorts World Sentosa.

10%

60%

G) Other non-residential properties. Some examples are:

  • Premises used for an industrial or agricultural purpose
  • Offices
  • Business or science park
  • Petrol station
  • Warehouse

0%

30%

The above PT Rebate does not apply to any other premises or part of any premises used or intended to be used for any residential purpose.


2) Rental Waivers for Tenants in Government-owned / managed Non-Residential Facilities

As announced on 26 March 2020, to help alleviate costs for businesses, the government will enhance rental waivers. The following tenants will qualify for rental waivers:

  1. a) Stallholders of Hawker Centres and Markets. Stallholders who qualified for the one month’s worth of rental waiver announced in Budget 2020 will now get three months’ worth of rental waiver (i.e. two months more), with a minimum waiver of $200 per month.
  2. b) Commercial Tenants. Commercial tenants who qualified for the half a month’s worth of rental waiver announced in Budget 2020 will now get two months’ worth of rental waiver in total (i.e. one and a half months more). Eligible tenants/lessees may include those providing commercial accommodation, retail, F&B, recreation, entertainment, and healthcare, services.
  3. c) Other Non-Residential Tenants. Government agencies such as JTC, SLA, HDB, URA, BCA, NParks, and PA will provide one month’s worth of rental waiver to eligible tenants of other non-residential premises who do not pay Property Tax. Eligible tenants/lessees may include those in premises used for industrial or agricultural purpose, or as an office, a business or science park, or a petrol station.

Should you require assistance please call us at +65 6334 4328.