§ 14N — Deduction for renovation or refurbishment expenditure

14N.—(1) Subject to this section, where any person carrying on a trade, profession or business has incurred on or after 16 February 2008 expenditure on any renovation or refurbishment works for the purposes of that trade, profession or business (called in this section renovation or refurbishment expenditure), the person may claim a deduction in respect of the renovation or refurbishment expenditure in accordance with this section.(2) Any claim for renovation or refurbishment expenditure under this section must be made at the time of lodgment of the return of income for the year of assessment relating to the basis period in which the expenditure is incurred or within such further time as the Comptroller may allow.

(3) For the purposes of subsection (1) and subject to subsections (7), (8), (8A) and (9), a deduction is allowed for one‑third of the renovation or refurbishment expenditure for the basis period in which the expenditure was incurred and the balance is to be allowed by 2 equal deductions, one for each of the basis periods for the next 2 succeeding years of assessment.

(3A) Despite subsection (3), for the purposes of subsection (1) and subject to subsections (7), (8), (8A) and (9), where the renovation or refurbishment expenditure is incurred during the basis period relating to the year of assessment 2021, 2022, 2024 or any subsequent year of assessment, a deduction is allowed for that year of assessment for the full amount of the renovation or refurbishment expenditure so incurred, unless a person elects for the deduction to be allowed in accordance with subsection (3).[41/2020; 27/2021]

[Act 30 of 2023 wef 30/10/2023]

[Act 35 of 2024 wef 27/11/2024]

(3B) An election made by a person under subsection (3A) is irrevocable.

(4) For the purposes of this section, any renovation or refurbishment expenditure incurred by any person prior to the commencement of that person’s trade, profession or business is deemed to have been incurred by that person on the first day that person carries on that trade, profession or business but the deduction for this is subject to section 14X.[34/2016]

(5) Where it appears to the Comptroller that a deduction under this section which has been allowed to any person in any year of assessment ought not to have been allowed by virtue of subsection (9)(a), there is deemed to be income of the person chargeable to tax, for the year of assessment in which the Comptroller discovers the incorrect claim, an amount equal to such deduction.

(6) [Deleted by Act 32 of 2019]

(7) A person is not entitled to —(a)

a deduction for renovation or refurbishment expenditure under this section where a deduction or an allowance for that expenditure is allowed under any other provision of this Act;

(b)

a deduction for renovation or refurbishment expenditure under this section in any basis period subsequent to the basis period in which the person permanently ceases the trade, profession or business for which purpose the expenditure was incurred; or

(c)

[Deleted by Act 32 of 2019]

(d)

[Deleted by Act 32 of 2019]

(e)

[Deleted by Act 32 of 2019]

(f)

a deduction for any amount of renovation or refurbishment expenditure incurred by a person during a specified period that begins with the basis period for the year of assessment 2013 or any subsequent year of assessment that is in excess of $300,000 of such expenditure.[32/2019]

(8) In subsection (7)(f), “specified period” means —(a)

a period that is —(i)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment in which a deduction is first allowed to the person under this section; or

(ii)

any successive period of 3 consecutive basis periods,

except that —

(iii)

if any of the basis periods in the period in sub-paragraph (i) or (ii) is the basis period for the year of assessment 2024, then that period (called period X) ends at the end of that basis period; and

(iv)

sub-paragraph (ii) excludes any period that succeeds period X; and

(b)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment 2025, or any successive period of 3 consecutive basis periods.[Act 35 of 2024 wef 27/11/2024]

(8A) Subsection (7)(f) applies for the purpose of determining the total amount of the deductions to be allowed to all the partners of a partnership carrying on a trade, profession or business, for the renovation or refurbishment expenditure incurred by the partnership, as if —(a)

references in those provisions to an amount of renovation or refurbishment expenditure incurred by a person were references to an amount of such expenditure incurred by the partnership; and

(b)

references in those provisions to a specified period were to —(i)

a period that is —(A)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment in which a deduction is first allowed to any partner of the partnership under this section for the renovation or refurbishment expenditure incurred by the partnership; or

(B)

any successive period of 3 consecutive basis periods,

except that —

(C)

if any of the basis periods in the period in sub-paragraph (A) or (B) is the basis period for the year of assessment 2024, then that period (called period X) ends at the end of that basis period; and

(D)

sub-paragraph (B) excludes any period that succeeds period X; and

(ii)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment 2025, or any successive period of 3 consecutive basis periods.[32/2019]

[Act 35 of 2024 wef 27/11/2024]

(9) No deduction is allowed to a person under this section for any renovation or refurbishment expenditure relating to —(a)

unless otherwise approved by the Minister or such person as the Minister may appoint, any renovation or refurbishment works, the plans of which require the approval of the Commissioner of Building Control under the Building Control Act 1989;

(b)

any designer or professional fees incurred in the basis period for the year of assessment 2024 or an earlier year of assessment, or any designer or professional fees related to the works mentioned in paragraph (a) incurred in the basis period for the year of assessment 2025 or a subsequent year of assessment;[Act 35 of 2024 wef 27/11/2024]

(c)

any antique;

(d)

any type of fine art, including any painting, drawing, print, calligraphy, mosaic, sculpture, pottery or art installation;

(da)

any works carried out in relation to a place of residence provided or to be provided by the person to the person’s employees, where the expenditure is incurred on or after 18 December 2012; or

(e)

such other item as may be prescribed by the Minister by regulations.[14Q

—(1) Subject to this section, where any person carrying on a trade, profession or business has incurred on or after 16 February 2008 expenditure on any renovation or refurbishment works for the purposes of that trade, profession or business (called in this section renovation or refurbishment expenditure), the person may claim a deduction in respect of the renovation or refurbishment expenditure in accordance with this section.

(2) Any claim for renovation or refurbishment expenditure under this section must be made at the time of lodgment of the return of income for the year of assessment relating to the basis period in which the expenditure is incurred or within such further time as the Comptroller may allow.

(3) For the purposes of subsection (1) and subject to subsections (7), (8), (8A) and (9), a deduction is allowed for one‑third of the renovation or refurbishment expenditure for the basis period in which the expenditure was incurred and the balance is to be allowed by 2 equal deductions, one for each of the basis periods for the next 2 succeeding years of assessment.

(3A) Despite subsection (3), for the purposes of subsection (1) and subject to subsections (7), (8), (8A) and (9), where the renovation or refurbishment expenditure is incurred during the basis period relating to the year of assessment 2021, 2022, 2024 or any subsequent year of assessment, a deduction is allowed for that year of assessment for the full amount of the renovation or refurbishment expenditure so incurred, unless a person elects for the deduction to be allowed in accordance with subsection (3).[41/2020; 27/2021]

[Act 30 of 2023 wef 30/10/2023]

[Act 35 of 2024 wef 27/11/2024]

(3B) An election made by a person under subsection (3A) is irrevocable.

(4) For the purposes of this section, any renovation or refurbishment expenditure incurred by any person prior to the commencement of that person’s trade, profession or business is deemed to have been incurred by that person on the first day that person carries on that trade, profession or business but the deduction for this is subject to section 14X.[34/2016]

(5) Where it appears to the Comptroller that a deduction under this section which has been allowed to any person in any year of assessment ought not to have been allowed by virtue of subsection (9)(a), there is deemed to be income of the person chargeable to tax, for the year of assessment in which the Comptroller discovers the incorrect claim, an amount equal to such deduction.

(6) [Deleted by Act 32 of 2019]

(7) A person is not entitled to —(a)

a deduction for renovation or refurbishment expenditure under this section where a deduction or an allowance for that expenditure is allowed under any other provision of this Act;

(b)

a deduction for renovation or refurbishment expenditure under this section in any basis period subsequent to the basis period in which the person permanently ceases the trade, profession or business for which purpose the expenditure was incurred; or

(c)

[Deleted by Act 32 of 2019]

(d)

[Deleted by Act 32 of 2019]

(e)

[Deleted by Act 32 of 2019]

(f)

a deduction for any amount of renovation or refurbishment expenditure incurred by a person during a specified period that begins with the basis period for the year of assessment 2013 or any subsequent year of assessment that is in excess of $300,000 of such expenditure.[32/2019]

(8) In subsection (7)(f), “specified period” means —(a)

a period that is —(i)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment in which a deduction is first allowed to the person under this section; or

(ii)

any successive period of 3 consecutive basis periods,

except that —

(iii)

if any of the basis periods in the period in sub-paragraph (i) or (ii) is the basis period for the year of assessment 2024, then that period (called period X) ends at the end of that basis period; and

(iv)

sub-paragraph (ii) excludes any period that succeeds period X; and

(b)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment 2025, or any successive period of 3 consecutive basis periods.[Act 35 of 2024 wef 27/11/2024]

(8A) Subsection (7)(f) applies for the purpose of determining the total amount of the deductions to be allowed to all the partners of a partnership carrying on a trade, profession or business, for the renovation or refurbishment expenditure incurred by the partnership, as if —(a)

references in those provisions to an amount of renovation or refurbishment expenditure incurred by a person were references to an amount of such expenditure incurred by the partnership; and

(b)

references in those provisions to a specified period were to —(i)

a period that is —(A)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment in which a deduction is first allowed to any partner of the partnership under this section for the renovation or refurbishment expenditure incurred by the partnership; or

(B)

any successive period of 3 consecutive basis periods,

except that —

(C)

if any of the basis periods in the period in sub-paragraph (A) or (B) is the basis period for the year of assessment 2024, then that period (called period X) ends at the end of that basis period; and

(D)

sub-paragraph (B) excludes any period that succeeds period X; and

(ii)

a period of 3 consecutive basis periods beginning with the basis period for the year of assessment 2025, or any successive period of 3 consecutive basis periods.[32/2019]

[Act 35 of 2024 wef 27/11/2024]

(9) No deduction is allowed to a person under this section for any renovation or refurbishment expenditure relating to —(a)

unless otherwise approved by the Minister or such person as the Minister may appoint, any renovation or refurbishment works, the plans of which require the approval of the Commissioner of Building Control under the Building Control Act 1989;

(b)

any designer or professional fees incurred in the basis period for the year of assessment 2024 or an earlier year of assessment, or any designer or professional fees related to the works mentioned in paragraph (a) incurred in the basis period for the year of assessment 2025 or a subsequent year of assessment;[Act 35 of 2024 wef 27/11/2024]

(c)

any antique;

(d)

any type of fine art, including any painting, drawing, print, calligraphy, mosaic, sculpture, pottery or art installation;

(da)

any works carried out in relation to a place of residence provided or to be provided by the person to the person’s employees, where the expenditure is incurred on or after 18 December 2012; or

(e)

such other item as may be prescribed by the Minister by regulations.[14Q