Currently, businesses may claim 100% write-off under Section 19A(10A) of the ITA on each asset costing $1,000 or lesser, subject to a cap of no more than $30,000 per YA.
Where this cap is reached in a YA, capital allowance under Section 19 or Section 19A(1) of ITA would apply.
The value of each asset qualifying for 100% write-off would be increased to no more than $5,000.
All other existing terms and conditions would continue to apply.
YA 2013
This tax change would bring about further reduction of businesses' income tax compliance costs as there would be a bigger pool of assets which do not require the tracking of tax written down values over a few years. However, the magnitude of the increase in the pool of qualifying assets may not be significant since the cap of $30,000 remains the same. It would be ideal if the cap of $30,000 is also increased in recognition of inflation over the past seven years as well as to allow inclusion of more items of low value assets.
IRAS would release further details of the change by 30 June 2012.
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