§ 14 — Deductions allowed

14.—(1) For the purpose of ascertaining the income of any person for any period from any source chargeable with tax under this Act (called in this Part the income), there are to be deducted all outgoings and expenses wholly and exclusively incurred during that period by that person in the production of the income, including —(a)

except as provided in this section —(i)

any sum payable by way of interest; and

(ii)

any sum payable in lieu of interest or for the reduction thereof, as may be prescribed by regulations (including the restriction of the deduction of the sum in respect of money borrowed before the basis period relating to the year of assessment 2008),

upon any money borrowed by that person where the Comptroller is satisfied that such sum is payable on capital employed in acquiring the income;

(b)

rent payable by any person in respect of any land or building or part thereof occupied by the person for the purpose of acquiring the income;

(c)

any expenses incurred for repair of premises, plant, machinery or fixtures employed in acquiring the income or for the renewal, repair or alteration of any implement, utensil or article so employed:Provided that no deduction may be made for the cost of renewal of any plant, machinery or fixture, which is the subject of an allowance under section 19 or 19A; or for the cost of reconstruction or rebuilding of any premises, buildings, structures or works of a permanent nature;

(d)

any bad debt incurred in any trade, business, profession or vocation that became bad during the period for which the income is being ascertained, and any of the following to the extent that it has been estimated, to the Comptroller’s satisfaction, to have become bad during that period:(i)

any doubtful debt;

(ii)

any other debt for which provisions have been made for impairment losses or expected credit losses (called in this paragraph provisioned debt),

even if the bad debt, doubtful debt or provisioned debt was due and payable before the commencement of that period, but only if —

(iii)

all sums recovered during that period on account of amounts previously written off or allowed in respect of bad debts, doubtful debts or provisioned debts (other than debts incurred before the commencement of the basis period for the first year of assessment under this Act) are for the purposes of this Act treated as receipts of the trade, business, profession or vocation for that period; and

(iv)

the bad debts, doubtful debts or provisioned debts in respect of which a deduction is claimed were included as a trading receipt in the income of the year within which they were incurred;[Act 25 of 2025 wef 08/12/2025]

(e)

any sum contributed by an employer to an approved pension or provident fund or society or any pension or provident fund constituted outside Singapore in respect of any of the employer’s employees engaged in activities relating to the production of the income of the employer, the contribution of which sum by the employer was obligatory by reason of any contract of employment or of any provision in the rules or constitution of the fund or society:Provided that in the case of any contribution to the Central Provident Fund or any approved pension or provident fund designated by the Minister under section 39(8) —

(i)

a deduction in respect of any such contribution by an employer in respect of an employee for any period —(A)

commencing on or after 1 September 2010 must not exceed 15%;

(B)

commencing on or after 1 March 2011 must not exceed 15½%;

(C)

commencing on or after 1 September 2011 must not exceed 16%;

(D)

commencing on or after 1 January 2015 must not exceed 17%,

of the remuneration paid by the employer to the employee for that period, and “remuneration” in this proviso means that part of an employee’s emoluments by reference to which his or her employer’s contributions are calculated;

(ii)

where any such fund or society is first established and a special contribution is made thereto by the employer whereby persons in the employer’s employment whose employment commenced prior to the establishment of the fund or society may qualify for the benefits thereunder in respect of such prior employment, the Comptroller may, when approving the fund or society, authorise such deductions in respect of that special contribution as the Comptroller thinks fit;

(iii)

no deduction is allowed in respect of any sum contributed by an employer for the period on or after 1 January 1999 to the Central Provident Fund in respect of an employee who holds a professional visit pass or a work pass or who would be required to obtain such a pass if the employee were to work in Singapore:

And provided that no deduction is allowed in respect of any contribution or part thereof to a pension or provident fund constituted outside Singapore made in respect of an employee, if the employee has been exempted from tax on such contribution or part thereof under section 13K;

(f)

any sum contributed by a platform operator to the Central Provident Fund account of any platform worker engaged in activities relating to the production of the income of the platform operator, the contribution of which sum by the platform operator was obligatory under section 8A(1) of the Central Provident Fund Act 1953;[Act 30 of 2024 wef 01/01/2025]

(fa)

[Deleted by Act 32 of 2019]

(fb)

any sum contributed by an employer in 2013 or any subsequent year to the medisave account maintained under the Central Provident Fund Act 1953 in respect of any of the employer’s employees engaged in activities relating to the production of the income of the employer, up to a maximum deduction for each employee’s medisave account, of —(i)

$1,500 per year (for contributions made before 2018); or

(ii)

$2,730 per year (for contributions made in 2018 and in each subsequent year),

less any previous contribution that is made to the same medisave account in the same year by the employer in the employer’s capacity as a person of a prescribed description under paragraph (fc) (if applicable), and that is deductible under that provision:

Provided that no deduction is allowed in respect of any sum contributed by an employer to the medisave account maintained under the Central Provident Fund Act 1953 in respect of an employee who holds a professional visit pass or a work pass or who would be required to obtain such a pass if the employee were to work in Singapore;

(fc)

any voluntary contribution in cash made in 2013 or any subsequent year by a person of a description prescribed by the Minister for the purposes of this paragraph, to the medisave account of a self‑employed individual maintained under the Central Provident Fund Act 1953, up to a maximum deduction for each individual’s medisave account, of —(i)

$1,500 per year (for contributions made before 2018); or

(ii)

$2,730 per year (for contributions made in 2018 and in each subsequent year),

less any previous contribution that is made to the same medisave account in the same year by the person of the prescribed description in the person’s capacity as an employer under paragraph (fb) (if applicable), and that is deductible under that provision;

(g)

zakat, fitrah or any religious dues, payment of which is made under any written law; and

(h)

where the income is derived from the working of a mine or other source of mineral deposits of a wasting nature, such deductions in respect of capital expenditure as may be prescribed in rules made under section 7.[37/2014; 39/2017; 32/2019]

(1A) [Deleted by Act 32 of 2019]

(2) Despite subsection (1), payments made by way of compensation for injuries or death, salaries, wages or similar emoluments or death gratuities to an employee (or his or her legal representative) who is the husband, wife or child of —(a)

any employer;

(b)

any partner of the firm in which that employee is employed;

(c)

any individual who by himself or herself or with his or her spouse or child or all of them have the ability to control, directly or indirectly, the company in which that employee is employed; or

(d)

any individual whose spouse or child or all of them have the ability to control, directly or indirectly, the company in which that employee is employed,

are allowed as deductions only to the extent to which, in the Comptroller’s opinion, they are reasonable in amount having regard to the services performed by that employee.

(3) Despite subsection (1), where outgoings and expenses falling within that subsection are incurred, whether directly or in the form of reimbursements, in respect of a motor car (whether or not owned by the person incurring the outgoings and expenses) to which this subsection applies, the sum to be allowed as a deduction is limited to the amount which bears to such outgoings and expenses the same proportion as $35,000 bears to the capital expenditure incurred by the owner in respect of the motor car, where such capital expenditure exceeds $35,000.

(3A) Any deduction for the cost of renewal of a motor car to which subsection (3) applies must not exceed $35,000.

(4) Subsections (3) and (3A) apply to a motor car which is constructed or adapted for the carriage of not more than 7 passengers exclusive of the driver and the weight of which unladen does not exceed 3,000 kilograms, and which was registered before 1 April 1998 as a business service passenger vehicle for the purposes of the Road Traffic Act 1961, but excludes such a motor car which is —(a)

used principally for instructional purposes; and

(b)

acquired by a person who carries on the business of providing driving instruction and who holds a driving school licence or driving instructor’s licence issued under that Act.

(5) Despite subsection (1), where, in the basis period for any year of assessment, any employer (other than an employer who derives any income from any trade, business, profession or vocation which is wholly or partly exempt from tax or subject to tax at a concessionary rate of tax under this Act or the Economic Expansion Incentives (Relief from Income Tax) Act 1967) incurs medical expenses falling within that subsection in excess of the maximum allowable amount in that basis period, the amount of the excess medical expenses is not allowed as deductions.

(6) Where, in the basis period for any year of assessment, any employer derives any income from any trade, business, profession or vocation which is wholly or partly exempt from tax or subject to tax at a concessionary rate of tax under this Act or the Economic Expansion Incentives (Relief from Income Tax) Act 1967 and incurs medical expenses in excess of the maximum allowable amount in that basis period, an amount equal to the excess medical expenses is deemed to be income of the employer chargeable to tax at the rate of tax under section 42(1) or 43(1) (as the case may be) for that year of assessment.

(6A) For the purpose of subsections (5) and (6), the maximum allowable amount in the basis period for any year of assessment is —(a)

2% of the total remuneration of the employer’s employees in that basis period in a case where the employer has —(i)

contributed the specified amount into the medisave accounts maintained under the Central Provident Fund of —(A)

at least 20% of the number of local employees who are employed by the employer as at the first day of the basis period for that year of assessment, for every calendar month in that basis period they are employed by the employer; and

(B)

every local employee who commences his or her employment with the employer during the basis period for that year of assessment, for the calendar month the employee commences his or her employment and every subsequent calendar month in that basis period he or she is employed by the employer; or

(ii)

incurred expenses in or in connection with the provision of a specified insurance plan to cover, for every calendar month in the basis period for that year of assessment, the cost of medical treatment of at least 50% of the number of local employees who are employed by the employer as at the first day of that basis period; and

(b)

in any other case, the amount determined in accordance with the formula in subsection (6B).

(6B) For the purpose of subsection (6A)(b), the maximum allowable amount in any basis period is to be ascertained —(a)

where the total amount of expenses incurred by the employer in providing qualifying insurance in that basis period is nil, in accordance with the formula

where A

is the lower of —

(i)

the total amount of medical expenses incurred by the employer for the employer’s employees in that basis period (excluding the total amount of general contributions made by the employer); and

(ii)

1% of the total remuneration of the employer’s employees in that basis period; and

B

is the lower of —

(i)

the total amount of general contributions made by the employer in that basis period; and

(ii)

the difference between 2% of the total remuneration of the employer’s employees in that basis period and A; and

(b)

where the total amount of expenses incurred by the employer in providing qualifying insurance in that basis period is not nil, in accordance with the formula

where C

is the lower of —

(i)

the total amount of expenses incurred by the employer in providing riders for the employer’s employees in that basis period; and

(ii)

1% of the total remuneration of the employer’s employees in that basis period; and

D

is the lower of —

(i)

the total amount of medical expenses incurred by the employer for the employer’s employees in that basis period (excluding the total amount of expenses incurred by the employer in providing riders for the employer’s employees); and

(ii)

the difference between 2% of the total remuneration of the employer’s employees in that basis period and C.

(6C) For the purpose of subsection (6B), a reference to expenses incurred by an employer in providing qualifying insurance excludes any reimbursement in cash by the employer of the employee for payment by the employee of premiums on such qualifying insurance.

(7) The references to medical expenses in subsections (5), (6) and (6B) are references to medical expenses which would, but for subsection (5), be allowable as deductions under this Act.

(7A) Despite subsection (1), no deduction is allowed to any person under that subsection in respect of any expenditure for which a deduction is allowed to that person under section 14ZJ.[Act 25 of 2025 wef 08/12/2025]

(8) In this section —“co‑payment” means the part of the amount of any claim, after deducting the deductible, which a person insured under the MediShield Life Scheme or an integrated medical insurance plan has to bear under the Scheme or plan;

“deductible” means the amount of any claim which a person insured under the MediShield Life Scheme or an integrated medical insurance plan has to bear before the insurer becomes liable to make payment under the Scheme or plan;

“expected credit loss” has the meaning given by section 14G(7);[Act 25 of 2025 wef 08/12/2025]

“general contribution” means any contribution falling within subsection (1)(fb) which is not —(a)

a contribution falling within subsection (6A)(a)(i); or

(b)

a sum paid by an employer to the medisave account maintained under the Central Provident Fund Act 1953 in respect of any of the employer’s employees as reimbursement of the employee for premiums paid or payable by the employee on a qualifying insurance;

“gross rate of pay” has the meaning given by section 2 of the Employment Act 1968;

“integrated medical insurance plan” has the same meaning as in the regulations made under section 34(2)(j) of the MediShield Life Scheme Act 2015 or section 77(1)(k) of the Central Provident Fund Act 1953;

“local employee” means a full‑time or part‑time employee who is a citizen or permanent resident of Singapore;

“medical expenses” means expenses incurred in or in connection with the provision of medical treatment and includes —(a)

expenses incurred in or in connection with the provision of maternity health care, natal care, and preventive and therapeutic treatment;

(b)

expenses incurred in or in connection with the provision of a medical clinic by the employer;

(c)

cash allowance in lieu of medical expenses;

(d)

expenses incurred in or in connection with the provision of insurance against the cost of medical treatment; and

(e)

contributions which are deductible under subsection (1)(fb);

“medical treatment” includes all forms of treatment for, and procedures for diagnosing, any physical or mental ailment, infirmity or defect;

“MediShield Life Scheme” means the MediShield Life Scheme referred to in section 3 of the MediShield Life Scheme Act 2015 and includes the MediShield Scheme established and maintained under section 53 of the Central Provident Fund Act 1953 as in force immediately before 1 November 2015;

“part‑time employee” has the meaning given by section 66A of the Employment Act 1968;

“qualifying insurance”, in relation to any basis period of an employer, means medical insurance under the MediShield Life Scheme or an integrated medical insurance plan that is provided by an employer to employees to cover the cost of medical treatment of —(a)

at least 20% of the number of local employees who are employed by the employer as at the first day of the basis period; and

(b)

every local employee who commences his or her employment with the employer during the basis period,

for every calendar month or part thereof in the basis period that the employees are employed by the employer;

“remuneration” means any wage, salary, leave pay, fee, commission, bonus, gratuity, allowance, other emoluments paid in cash by or on behalf of an employer and contributions to any approved pension or provident fund by any employer which are allowable as deductions under this Act, but does not include any director’s fee, medical expense, cash allowance in lieu of medical expenses and benefit‑in‑kind;

“rider” means any insurance under which the insurer of the rider is liable to pay in full or in part the deductible or co‑payment relating to the MediShield Life Scheme or an integrated medical insurance plan;

“specified amount”, in relation to any calendar month, means —(a)

in the case of a full‑time employee who falls under subsection (6A)(a)(i), an amount equal to at least 1% of the employee’s gross rate of pay for the calendar month, subject to a minimum contribution of $16 per calendar month;

(b)

in the case of a part‑time employee who falls under subsection (6A)(a)(i), an amount equal to at least 1% of the employee’s gross rate of pay for the calendar month;

“specified insurance plan” means a medical insurance plan sponsored by an employer that —(a)

confers hospitalisation benefits during the period of employment of an employee and up to a period of 12 months immediately after the employee leaves his or her employment for any reason; and

(b)

treats the employee as being continuously insured when he or she is employed by another employer who provides him or her with an insurance plan that confers the hospitalisation benefits described in paragraph (a).[4/2015; 34/2016; 32/2019]

—(1) For the purpose of ascertaining the income of any person for any period from any source chargeable with tax under this Act (called in this Part the income), there are to be deducted all outgoings and expenses wholly and exclusively incurred during that period by that person in the production of the income, including —(a)

except as provided in this section —(i)

any sum payable by way of interest; and

(ii)

any sum payable in lieu of interest or for the reduction thereof, as may be prescribed by regulations (including the restriction of the deduction of the sum in respect of money borrowed before the basis period relating to the year of assessment 2008),

upon any money borrowed by that person where the Comptroller is satisfied that such sum is payable on capital employed in acquiring the income;

(b)

rent payable by any person in respect of any land or building or part thereof occupied by the person for the purpose of acquiring the income;

(c)

any expenses incurred for repair of premises, plant, machinery or fixtures employed in acquiring the income or for the renewal, repair or alteration of any implement, utensil or article so employed:Provided that no deduction may be made for the cost of renewal of any plant, machinery or fixture, which is the subject of an allowance under section 19 or 19A; or for the cost of reconstruction or rebuilding of any premises, buildings, structures or works of a permanent nature;

(d)

any bad debt incurred in any trade, business, profession or vocation that became bad during the period for which the income is being ascertained, and any of the following to the extent that it has been estimated, to the Comptroller’s satisfaction, to have become bad during that period:(i)

any doubtful debt;

(ii)

any other debt for which provisions have been made for impairment losses or expected credit losses (called in this paragraph provisioned debt),

even if the bad debt, doubtful debt or provisioned debt was due and payable before the commencement of that period, but only if —

(iii)

all sums recovered during that period on account of amounts previously written off or allowed in respect of bad debts, doubtful debts or provisioned debts (other than debts incurred before the commencement of the basis period for the first year of assessment under this Act) are for the purposes of this Act treated as receipts of the trade, business, profession or vocation for that period; and

(iv)

the bad debts, doubtful debts or provisioned debts in respect of which a deduction is claimed were included as a trading receipt in the income of the year within which they were incurred;[Act 25 of 2025 wef 08/12/2025]

(e)

any sum contributed by an employer to an approved pension or provident fund or society or any pension or provident fund constituted outside Singapore in respect of any of the employer’s employees engaged in activities relating to the production of the income of the employer, the contribution of which sum by the employer was obligatory by reason of any contract of employment or of any provision in the rules or constitution of the fund or society:Provided that in the case of any contribution to the Central Provident Fund or any approved pension or provident fund designated by the Minister under section 39(8) —

(i)

a deduction in respect of any such contribution by an employer in respect of an employee for any period —(A)

commencing on or after 1 September 2010 must not exceed 15%;

(B)

commencing on or after 1 March 2011 must not exceed 15½%;

(C)

commencing on or after 1 September 2011 must not exceed 16%;

(D)

commencing on or after 1 January 2015 must not exceed 17%,

of the remuneration paid by the employer to the employee for that period, and “remuneration” in this proviso means that part of an employee’s emoluments by reference to which his or her employer’s contributions are calculated;

(ii)

where any such fund or society is first established and a special contribution is made thereto by the employer whereby persons in the employer’s employment whose employment commenced prior to the establishment of the fund or society may qualify for the benefits thereunder in respect of such prior employment, the Comptroller may, when approving the fund or society, authorise such deductions in respect of that special contribution as the Comptroller thinks fit;

(iii)

no deduction is allowed in respect of any sum contributed by an employer for the period on or after 1 January 1999 to the Central Provident Fund in respect of an employee who holds a professional visit pass or a work pass or who would be required to obtain such a pass if the employee were to work in Singapore:

And provided that no deduction is allowed in respect of any contribution or part thereof to a pension or provident fund constituted outside Singapore made in respect of an employee, if the employee has been exempted from tax on such contribution or part thereof under section 13K;

(f)

any sum contributed by a platform operator to the Central Provident Fund account of any platform worker engaged in activities relating to the production of the income of the platform operator, the contribution of which sum by the platform operator was obligatory under section 8A(1) of the Central Provident Fund Act 1953;[Act 30 of 2024 wef 01/01/2025]

(fa)

[Deleted by Act 32 of 2019]

(fb)

any sum contributed by an employer in 2013 or any subsequent year to the medisave account maintained under the Central Provident Fund Act 1953 in respect of any of the employer’s employees engaged in activities relating to the production of the income of the employer, up to a maximum deduction for each employee’s medisave account, of —(i)

$1,500 per year (for contributions made before 2018); or

(ii)

$2,730 per year (for contributions made in 2018 and in each subsequent year),

less any previous contribution that is made to the same medisave account in the same year by the employer in the employer’s capacity as a person of a prescribed description under paragraph (fc) (if applicable), and that is deductible under that provision:

Provided that no deduction is allowed in respect of any sum contributed by an employer to the medisave account maintained under the Central Provident Fund Act 1953 in respect of an employee who holds a professional visit pass or a work pass or who would be required to obtain such a pass if the employee were to work in Singapore;

(fc)

any voluntary contribution in cash made in 2013 or any subsequent year by a person of a description prescribed by the Minister for the purposes of this paragraph, to the medisave account of a self‑employed individual maintained under the Central Provident Fund Act 1953, up to a maximum deduction for each individual’s medisave account, of —(i)

$1,500 per year (for contributions made before 2018); or

(ii)

$2,730 per year (for contributions made in 2018 and in each subsequent year),

less any previous contribution that is made to the same medisave account in the same year by the person of the prescribed description in the person’s capacity as an employer under paragraph (fb) (if applicable), and that is deductible under that provision;

(g)

zakat, fitrah or any religious dues, payment of which is made under any written law; and

(h)

where the income is derived from the working of a mine or other source of mineral deposits of a wasting nature, such deductions in respect of capital expenditure as may be prescribed in rules made under section 7.[37/2014; 39/2017; 32/2019]

(1A) [Deleted by Act 32 of 2019]

(2) Despite subsection (1), payments made by way of compensation for injuries or death, salaries, wages or similar emoluments or death gratuities to an employee (or his or her legal representative) who is the husband, wife or child of —(a)

any employer;

(b)

any partner of the firm in which that employee is employed;

(c)

any individual who by himself or herself or with his or her spouse or child or all of them have the ability to control, directly or indirectly, the company in which that employee is employed; or

(d)

any individual whose spouse or child or all of them have the ability to control, directly or indirectly, the company in which that employee is employed,

are allowed as deductions only to the extent to which, in the Comptroller’s opinion, they are reasonable in amount having regard to the services performed by that employee.

(3) Despite subsection (1), where outgoings and expenses falling within that subsection are incurred, whether directly or in the form of reimbursements, in respect of a motor car (whether or not owned by the person incurring the outgoings and expenses) to which this subsection applies, the sum to be allowed as a deduction is limited to the amount which bears to such outgoings and expenses the same proportion as $35,000 bears to the capital expenditure incurred by the owner in respect of the motor car, where such capital expenditure exceeds $35,000.

(3A) Any deduction for the cost of renewal of a motor car to which subsection (3) applies must not exceed $35,000.

(4) Subsections (3) and (3A) apply to a motor car which is constructed or adapted for the carriage of not more than 7 passengers exclusive of the driver and the weight of which unladen does not exceed 3,000 kilograms, and which was registered before 1 April 1998 as a business service passenger vehicle for the purposes of the Road Traffic Act 1961, but excludes such a motor car which is —(a)

used principally for instructional purposes; and

(b)

acquired by a person who carries on the business of providing driving instruction and who holds a driving school licence or driving instructor’s licence issued under that Act.

(5) Despite subsection (1), where, in the basis period for any year of assessment, any employer (other than an employer who derives any income from any trade, business, profession or vocation which is wholly or partly exempt from tax or subject to tax at a concessionary rate of tax under this Act or the Economic Expansion Incentives (Relief from Income Tax) Act 1967) incurs medical expenses falling within that subsection in excess of the maximum allowable amount in that basis period, the amount of the excess medical expenses is not allowed as deductions.

(6) Where, in the basis period for any year of assessment, any employer derives any income from any trade, business, profession or vocation which is wholly or partly exempt from tax or subject to tax at a concessionary rate of tax under this Act or the Economic Expansion Incentives (Relief from Income Tax) Act 1967 and incurs medical expenses in excess of the maximum allowable amount in that basis period, an amount equal to the excess medical expenses is deemed to be income of the employer chargeable to tax at the rate of tax under section 42(1) or 43(1) (as the case may be) for that year of assessment.

(6A) For the purpose of subsections (5) and (6), the maximum allowable amount in the basis period for any year of assessment is —(a)

2% of the total remuneration of the employer’s employees in that basis period in a case where the employer has —(i)

contributed the specified amount into the medisave accounts maintained under the Central Provident Fund of —(A)

at least 20% of the number of local employees who are employed by the employer as at the first day of the basis period for that year of assessment, for every calendar month in that basis period they are employed by the employer; and

(B)

every local employee who commences his or her employment with the employer during the basis period for that year of assessment, for the calendar month the employee commences his or her employment and every subsequent calendar month in that basis period he or she is employed by the employer; or

(ii)

incurred expenses in or in connection with the provision of a specified insurance plan to cover, for every calendar month in the basis period for that year of assessment, the cost of medical treatment of at least 50% of the number of local employees who are employed by the employer as at the first day of that basis period; and

(b)

in any other case, the amount determined in accordance with the formula in subsection (6B).

(6B) For the purpose of subsection (6A)(b), the maximum allowable amount in any basis period is to be ascertained —(a)

where the total amount of expenses incurred by the employer in providing qualifying insurance in that basis period is nil, in accordance with the formula

where A

is the lower of —

(i)

the total amount of medical expenses incurred by the employer for the employer’s employees in that basis period (excluding the total amount of general contributions made by the employer); and

(ii)

1% of the total remuneration of the employer’s employees in that basis period; and

B

is the lower of —

(i)

the total amount of general contributions made by the employer in that basis period; and

(ii)

the difference between 2% of the total remuneration of the employer’s employees in that basis period and A; and

(b)

where the total amount of expenses incurred by the employer in providing qualifying insurance in that basis period is not nil, in accordance with the formula

where C

is the lower of —

(i)

the total amount of expenses incurred by the employer in providing riders for the employer’s employees in that basis period; and

(ii)

1% of the total remuneration of the employer’s employees in that basis period; and

D

is the lower of —

(i)

the total amount of medical expenses incurred by the employer for the employer’s employees in that basis period (excluding the total amount of expenses incurred by the employer in providing riders for the employer’s employees); and

(ii)

the difference between 2% of the total remuneration of the employer’s employees in that basis period and C.

(6C) For the purpose of subsection (6B), a reference to expenses incurred by an employer in providing qualifying insurance excludes any reimbursement in cash by the employer of the employee for payment by the employee of premiums on such qualifying insurance.

(7) The references to medical expenses in subsections (5), (6) and (6B) are references to medical expenses which would, but for subsection (5), be allowable as deductions under this Act.

(7A) Despite subsection (1), no deduction is allowed to any person under that subsection in respect of any expenditure for which a deduction is allowed to that person under section 14ZJ.[Act 25 of 2025 wef 08/12/2025]

(8) In this section —“co‑payment” means the part of the amount of any claim, after deducting the deductible, which a person insured under the MediShield Life Scheme or an integrated medical insurance plan has to bear under the Scheme or plan;

“deductible” means the amount of any claim which a person insured under the MediShield Life Scheme or an integrated medical insurance plan has to bear before the insurer becomes liable to make payment under the Scheme or plan;

“expected credit loss” has the meaning given by section 14G(7);[Act 25 of 2025 wef 08/12/2025]

“general contribution” means any contribution falling within subsection (1)(fb) which is not —(a)

a contribution falling within subsection (6A)(a)(i); or

(b)

a sum paid by an employer to the medisave account maintained under the Central Provident Fund Act 1953 in respect of any of the employer’s employees as reimbursement of the employee for premiums paid or payable by the employee on a qualifying insurance;

“gross rate of pay” has the meaning given by section 2 of the Employment Act 1968;

“integrated medical insurance plan” has the same meaning as in the regulations made under section 34(2)(j) of the MediShield Life Scheme Act 2015 or section 77(1)(k) of the Central Provident Fund Act 1953;

“local employee” means a full‑time or part‑time employee who is a citizen or permanent resident of Singapore;

“medical expenses” means expenses incurred in or in connection with the provision of medical treatment and includes —(a)

expenses incurred in or in connection with the provision of maternity health care, natal care, and preventive and therapeutic treatment;

(b)

expenses incurred in or in connection with the provision of a medical clinic by the employer;

(c)

cash allowance in lieu of medical expenses;

(d)

expenses incurred in or in connection with the provision of insurance against the cost of medical treatment; and

(e)

contributions which are deductible under subsection (1)(fb);

“medical treatment” includes all forms of treatment for, and procedures for diagnosing, any physical or mental ailment, infirmity or defect;

“MediShield Life Scheme” means the MediShield Life Scheme referred to in section 3 of the MediShield Life Scheme Act 2015 and includes the MediShield Scheme established and maintained under section 53 of the Central Provident Fund Act 1953 as in force immediately before 1 November 2015;

“part‑time employee” has the meaning given by section 66A of the Employment Act 1968;

“qualifying insurance”, in relation to any basis period of an employer, means medical insurance under the MediShield Life Scheme or an integrated medical insurance plan that is provided by an employer to employees to cover the cost of medical treatment of —(a)

at least 20% of the number of local employees who are employed by the employer as at the first day of the basis period; and

(b)

every local employee who commences his or her employment with the employer during the basis period,

for every calendar month or part thereof in the basis period that the employees are employed by the employer;

“remuneration” means any wage, salary, leave pay, fee, commission, bonus, gratuity, allowance, other emoluments paid in cash by or on behalf of an employer and contributions to any approved pension or provident fund by any employer which are allowable as deductions under this Act, but does not include any director’s fee, medical expense, cash allowance in lieu of medical expenses and benefit‑in‑kind;

“rider” means any insurance under which the insurer of the rider is liable to pay in full or in part the deductible or co‑payment relating to the MediShield Life Scheme or an integrated medical insurance plan;

“specified amount”, in relation to any calendar month, means —(a)

in the case of a full‑time employee who falls under subsection (6A)(a)(i), an amount equal to at least 1% of the employee’s gross rate of pay for the calendar month, subject to a minimum contribution of $16 per calendar month;

(b)

in the case of a part‑time employee who falls under subsection (6A)(a)(i), an amount equal to at least 1% of the employee’s gross rate of pay for the calendar month;

“specified insurance plan” means a medical insurance plan sponsored by an employer that —(a)

confers hospitalisation benefits during the period of employment of an employee and up to a period of 12 months immediately after the employee leaves his or her employment for any reason; and

(b)

treats the employee as being continuously insured when he or she is employed by another employer who provides him or her with an insurance plan that confers the hospitalisation benefits described in paragraph (a).[4/2015; 34/2016; 32/2019]