5B.—(1) Where the date of amalgamation falls within the basis period for the year of assessment 2011, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis periods for the years of assessment 2011 and 2012 for which a deduction or allowance may be allowed or made to it under that PIC provision for those years of assessment shall be determined as follows:| (a) | for the year of assessment 2011, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2011; and | | (ii) | an amount computed in accordance with the formula: | | is the aggregate of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2011 for which a deduction or allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act; |
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[S 170/2022 wef 31/12/2021] |
| | (b) | for the year of assessment 2012, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2012; and | | (ii) | the balance after deducting from $800,000 the aggregate of —| (A) | X1 referred to in sub‑paragraph (a)(ii); and | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii). |
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(2) Where the date of amalgamation falls within the basis period for the year of assessment 2012, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis period for that year of assessment for which a deduction or allowance may be allowed or made to it under that PIC provision for that year of assessment shall be the lower of —| (a) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2012; and | | (b) | an amount computed in accordance with the formula: | | is the aggregate of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2011 or 2012, for which a deduction or allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act. |
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[S 170/2022 wef 31/12/2021] |
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(3) Where the date of amalgamation falls within the basis period for the year of assessment 2013, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis periods for the years of assessment 2013, 2014 and 2015 for which a deduction or allowance may be allowed or made to it under that PIC provision for those years of assessment shall be determined as follows:| (a) | for the year of assessment 2013, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2013; and | | (ii) | an amount computed in accordance with the formula: | | is the aggregate of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2013 for which a deduction or allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act; |
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[S 170/2022 wef 31/12/2021] |
| | (b) | for the year of assessment 2014, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2014; and | | (ii) | the balance after deducting from $1,200,000 the aggregate of —| (A) | X3 referred to in sub‑paragraph (a)(ii); and | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii); |
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| | (c) | for the year of assessment 2015, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2015; and | | (ii) | the balance after deducting from $1,200,000 the aggregate of —| (A) | X3 referred to in sub‑paragraph (a)(ii); | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii); and | | (C) | the lower of the amounts specified in sub‑paragraph (b)(i) and (ii). |
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(4) Where the date of amalgamation falls within the basis period for the year of assessment 2014, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis periods for the years of assessment 2014 and 2015 for which a deduction or allowance may be allowed or made to it under that PIC provision for those years of assessment shall be determined as follows:| (a) | for the year of assessment 2014, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2014; and | | (ii) | an amount computed in accordance with the formula: | | is the aggregate of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2013 or 2014 for which a deduction or allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act; |
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[S 170/2022 wef 31/12/2021] |
| | (b) | for the year of assessment 2015, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2015; and | | (ii) | the balance after deducting from $1,200,000 the aggregate of —| (A) | X4 referred to in sub‑paragraph (a)(ii); and | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii). |
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(5) Where the date of amalgamation falls within the basis period in the year of assessment 2015, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis period for that year of assessment for which a deduction or allowance may be allowed or made to it under that PIC provision for that year of assessment shall be the lower of —| (a) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2015; and | | (b) | an amount computed in accordance with the formula: | | is the aggregate of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2013, 2014 or 2015, for which a deduction or allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act. |
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[S 170/2022 wef 31/12/2021] |
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(5A) Where the date of amalgamation falls within the basis period for the year of assessment 2016, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis periods for the years of assessment 2016, 2017 and 2018 for which a deduction or an allowance may be allowed or made to it under that PIC provision for those years of assessment is determined as follows:| (a) | for the year of assessment 2016, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2016; and | | (ii) | an amount computed in accordance with the formula $1,200,000 – X6, where X6 is the total of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2016 for which a deduction or an allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act; [S 170/2022 wef 31/12/2021] |
| | (b) | for the year of assessment 2017, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2017; and | | (ii) | the balance after deducting from $1,200,000 the total of —| (A) | X6 mentioned in sub‑paragraph (a)(ii); and | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii); |
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| | (c) | for the year of assessment 2018, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2018; and | | (ii) | the balance after deducting from $1,200,000 the total of —| (A) | X6 mentioned in sub‑paragraph (a)(ii); | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii); and | | (C) | the lower of the amounts specified in sub‑paragraph (b)(i) and (ii). [S 170/2022 wef 27/11/2014] |
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(5B) Where the date of amalgamation falls within the basis period for the year of assessment 2017, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis periods for the years of assessment 2017 and 2018 for which a deduction or an allowance may be allowed or made to it under that PIC provision for those years of assessment is determined as follows:| (a) | for the year of assessment 2017, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2017; and | | (ii) | an amount computed in accordance with the formula $1,200,000 – X7, where X7 is the total of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2016 or 2017 for which a deduction or an allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act; [S 170/2022 wef 31/12/2021] |
| | (b) | for the year of assessment 2018, the lower of —| (i) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2018; and | | (ii) | the balance after deducting from $1,200,000 the total of —| (A) | X7 mentioned in sub‑paragraph (a)(ii); and | | (B) | the lower of the amounts specified in sub‑paragraph (a)(i) and (ii). [S 170/2022 wef 27/11/2014] |
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(5C) Where the date of amalgamation falls within the basis period in the year of assessment 2018, the amount of any PIC expenditure under a PIC provision incurred by the amalgamated company during the basis period for that year of assessment for which a deduction or an allowance may be allowed or made to it under that PIC provision for that year of assessment is the lower of —| (a) | the amount of the PIC expenditure under that PIC provision incurred by the amalgamated company during the basis period for the year of assessment 2018; and | | (b) | an amount computed in accordance with the formula $1,200,000 – X8, where X8 is the total of every amount of PIC expenditure under that PIC provision incurred by an amalgamating company during the basis period for the year of assessment 2016, 2017 or 2018 for which a deduction or an allowance is allowed or made to that company under that PIC provision, including any such expenditure for which a cash payout is granted to that company under section 37G of the Act. [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] |
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| (6) For the avoidance of doubt, the deduction or allowance which may be allowed or made to the amalgamated company under paragraphs (1) to (5C) shall be subject to section 37G(14A) of the Act. [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] |
(7) For the purpose of determining the applicability of section 14A(1C), 14D(5)(a) and (b), 14O(4), 14P(2A), 14Q(5), 19A(2BA) or 19B(1BA) of the Act (reduction of the expenditure used for computing the deduction or allowance where the person claiming it did not carry on a trade or business during a specified basis period) to an amalgamating company and the amalgamated company in a case where the date of amalgamation falls within the basis period for the year of assessment 2011 or 2012 —| (a) | in relation to the amalgamating company, any trade or business carried on by the amalgamated company on or after the date of amalgamation, shall be deemed to have been carried on by the amalgamating company as if the amalgamating company existed on or after that date; and | | (b) | in relation to the amalgamated company, any trade or business carried on by any of the amalgamating companies prior to the date of amalgamation, shall be deemed to have been carried on by the amalgamated company as if the amalgamated company existed prior to that date. [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] |
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(8) For the purpose of determining the applicability of section 14A(1D), 14D(5)(c), (d) and (e), 14O(5), 14P(2B), 14Q(6), 14T(3), 19A(2BB) or 19B(1BB) of the Act (reduction of the expenditure used for computing the deduction or allowance where the person claiming it did not carry on a trade or business during one or 2 specified basis periods) to an amalgamating company and the amalgamated company in a case where the date of amalgamation falls within the basis period for the year of assessment 2013, 2014 or 2015 —| (a) | in relation to the amalgamating company, any trade or business carried on by the amalgamated company on or after the date of amalgamation shall be deemed to have been carried on by the amalgamating company as if the amalgamating company existed on or after that date; and | | (b) | in relation to the amalgamated company, any trade or business carried on by any of the amalgamating companies prior to the date of amalgamation shall be deemed to have been carried on by the amalgamated company as if the amalgamated company existed prior to that date. [S 170/2022 wef 28/11/2013] [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] |
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(8A) For the purpose of determining the applicability of section 14A(1DA), 14D(5)(da), (db) and (f), 14O(5AA), 14P(2C), 14Q(6AA), 14T(4B), 19A(2BC) or 19B(1BC) of the Act (reduction of the expenditure used for computing the deduction or allowance where the person claiming it did not carry on a trade or business during one or 2 specified basis periods) to an amalgamating company and the amalgamated company in a case where the date of amalgamation falls within the basis period for the year of assessment 2016, 2017 or 2018 —| (a) | in relation to the amalgamating company, any trade or business carried on by the amalgamated company on or after the date of amalgamation is considered to have been carried on by the amalgamating company as if the amalgamating company existed on or after that date; and | | (b) | in relation to the amalgamated company, any trade or business carried on by any of the amalgamating companies prior to the date of amalgamation is considered to have been carried on by the amalgamated company as if the amalgamated company existed prior to that date. [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] |
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(9) In this regulation —“Productivity and Innovation Credit Scheme expenditure” or “PIC expenditure”, in relation to any PIC provision, means —| (a) | in the case of section 14A(1A), (1B) or (1BA) of the Act, qualifying intellectual property registration costs under that provision; [S 170/2022 wef 27/11/2014] | | (b) | in the case of section 14D(2) of the Act, qualifying expenditure under that section; [S 170/2022 wef 31/12/2021] | | (c) | in the case of section 14O(1), (2) or (2A) of the Act, qualifying training expenditure under that provision; [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] | | (d) | in the case of section 14P(1), (2) or (2AA) of the Act, qualifying design expenditure under that provision; [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] | | (e) | in the case of section 14Q(1), (2) or (2A) of the Act read with section 14Q(6C) of the Act, expenditure on the leasing of any PIC automation equipment under a qualifying lease or procuring cloud computing services under that provision; [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] | | (ea) | in the case of section 14T(1) or (4) of the Act, expenditure on the licensing from another person of any qualifying intellectual property rights under that provision; [S 170/2022 wef 28/11/2013] [S 170/2022 wef 27/11/2014] [S 170/2022 wef 31/12/2021] | | (f) | in the case of section 19A(2A), (2B) or (2BAA) of the Act, capital expenditure on the provision of any PIC automation equipment under that provision; and [S 170/2022 wef 27/11/2014] | | (g) | in the case of section 19B(1A), (1B) or (1BAA) of the Act, capital expenditure in acquiring any intellectual property rights under that provision; [S 170/2022 wef 27/11/2014] |
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“PIC provision” means any of the following provisions of the Act:| (a) | section 14A(1A), (1B) or (1BA); | | (b) | section 14D(2); [S 170/2022 wef 31/12/2021] | | (c) | section 14O(1), (2) or (2A); [S 170/2022 wef 31/12/2021] | | (d) | section 14P(1), (2) or (2AA); [S 170/2022 wef 31/12/2021] | | (e) | section 14Q(1), (2) or (2A); [S 170/2022 wef 31/12/2021] | | (f) | section 14T(1) or (4); [S 170/2022 wef 31/12/2021] | | (g) | section 19A(2A), (2B) or (2BAA); | | (h) | section 19B(1A), (1B) or (1BAA). [S 170/2022 wef 27/11/2014] |
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