Singapore Corporate Tax 2026: Rate, Exemptions and Rebate at a Glance

What is the corporate tax rate in Singapore in 2026?

Singapore taxes companies at a flat rate of 17% of their chargeable income. This applies equally to local and foreign companies; Budget 2026 did not change the rate. Each Year of Assessment (YA) taxes the income of the financial year that ended in the previous year: YA 2026 covers the financial year that ended in 2025.

Source: IRAS, Corporate Income Tax Rate, Rebates & Tax Exemption Schemes · MOF, Enhanced Support · As at 29 Sep 2026

The return for YA 2026 is due by 30 November 2026. What it involves: Deadline 30 November: what you file.

Which exemption applies to your company: start-up or partial?

A company receives either the start-up tax exemption or the partial tax exemption, not both. Both apply only to income taxed at the 17% rate.

Source: IRAS, Corporate Income Tax Rate, Rebates & Tax Exemption Schemes · As at 29 Sep 2026

According to IRAS, the qualifying start-up tax exemption requires the company to

• be incorporated in Singapore,
• be tax resident in Singapore for that YA (section 3),
• have its total share capital beneficially held directly by no more than 20 shareholders throughout the basis period, where all shareholders are individuals or at least one individual holds at least 10% of the issued ordinary shares.

Companies whose principal activity is investment holding, and companies that undertake property development for sale, investment or both, are excluded. The exemption applies only for the first three consecutive YAs; a year that is not used cannot be claimed later. From the fourth YA, the partial tax exemption applies. IRAS states expressly that it takes a serious view of companies set up to abuse the scheme.

Why the start-up exemption depends on tax residency

According to IRAS, a company is tax resident in Singapore when its control and management is exercised there. This is usually determined by where the board meetings at which strategic decisions are made take place. For a given YA, the preceding calendar year counts. IRAS also points out that in certain scenarios, holding board meetings in Singapore may not be sufficient.

The start-up exemption requires the company to be tax resident in Singapore, meaning it is controlled and managed there; a Pte. Ltd. incorporated in Singapore but managed from Germany or another country does not automatically meet this condition. The partial tax exemption then applies, as it is also available to non-resident companies.

If you manage the company from abroad, we clarify tax residency before any figures, in a free first consultation.

The YA 2026 rebate: 50%, cash grant and S$40,000 cap

For YA 2026 the corporate income tax rebate is 50%, capped at S$40,000 including a S$2,000 cash grant that requires at least one local employee (raised on 7 April 2026). Budget 2026 in February had provided for 40%, S$1,500 and S$30,000; the Ministerial Statement of 7 April 2026 increased these values.

• Rebate: for all taxpaying companies, whether tax resident or not. IRAS applies it automatically in the assessment; no application is needed. It is computed on the tax payable after tax set-offs (e.g. foreign tax credit), but before tax deducted at source.
• Cash grant of S$2,000: only for active companies that made CPF contributions in calendar year 2025 for at least one local employee (Singapore citizen or permanent resident); shareholders who are also directors do not count. It is paid out automatically and is not taxable.
• Set-off: if the company receives the cash grant, the rebate is reduced by S$2,000; if the rebate is S$2,000 or less, no rebate is given. Where 50% of the tax exceeds S$2,000, the total benefit stays the same.
• YA 2027: no rebate has been announced so far (as at 29 Sep 2026).

Source: IRAS · MOF, Enhanced Support · MOF, Budget 2026 Annex H-1 · As at 29 Sep 2026

Calculator: how much corporate tax your Pte. Ltd. pays

The formula is open: (chargeable income − exemption) × 17%, less a 50% rebate for YA 2026, capped at S$40,000. The four questions decide which exemption the calculator applies.

Effective tax burden: why 17% is rarely what you pay

The 17% applies to the part of the income left after the exemption. Measured against total income, the burden is therefore lower and approaches 17% as income rises. From S$200,000 both exemptions are used up; the difference between them then stays constant at S$22,500 of exempt income, i.e. S$3,825 of tax before rebate.

Three fictitious worked examples

Own calculation based on the IRAS tiers; assumes all income taxed at 17%, no losses, no other deductions; rebate 50%, total benefit capped at S$40,000 · IRAS · As at 29 Sep 2026

If the company qualifies for the cash grant, the benefit is split into the S$2,000 cash grant and the remaining rebate; in all six examples the total stays the same. The effective rate shows only the Singapore side. How profits or distributions are treated in your country of residence is not included.

Dividends and withholding tax: the one-tier system

Singapore uses the one-tier system: the tax paid by the company is final. IRAS therefore lists dividends paid by a Singapore resident company under this system among the income that is generally not taxable in Singapore. In addition, according to IRAS, Singapore currently does not impose withholding tax on dividends.

How dividends are taxed where you live depends on your country of residence. Singapore has a double tax treaty with Germany, Austria and Switzerland. This guide deliberately makes no statement on taxation in your country.

Foreign companies and foreign shareholders

• The 17% rate applies equally to local and foreign companies.
• The partial tax exemption is available to all companies not claiming the start-up exemption, including non-resident companies.
• The start-up exemption requires the company to be incorporated and tax resident in Singapore. A branch of a foreign company is not incorporated in Singapore.
• The shareholder condition requires individuals but does not refer to nationality. If a foreign corporation, such as a German GmbH, holds all the shares, the condition is not met; the company then receives the partial tax exemption.
• The YA 2026 rebate applies to taxpaying companies, whether tax resident or not.

Not yet incorporated? Set up a Pte. Ltd. so the start-up exemption can apply. Whether Singapore or Hong Kong fits your plans better: Singapore and Hong Kong compared.

What is coming in 2027 and 2028: a 400% deduction for AI expenditure

Source: MOF, Budget 2026 Annex H-1 · IRAS, Enterprise Innovation Scheme · IRAS, Budget 2026 · As at 29 Sep 2026

The EIS itself runs from YA 2024 to YA 2028 and provides a 400% deduction on up to S$400,000 of qualifying expenditure per year for each of four qualifying activities; AI adoption is added as a further activity for YA 2027 and YA 2028. The AI deduction does not yet play a role in the YA 2026 return.

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