Mergers & Acquisitions Allowance Singapore: What It Is And How You Can Use It


If you have been tasked with the responsibility to manage an M&A, then you know that there are many different things that could go wrong. This article will discuss the Mergers & Acquisitions Allowance Singapore, what it is, and how its usage can benefit your company or organization.

What is the M&A Allowance Singapore?

The Mergers and Acquisitions (M&A) allowance in Singapore is a tax break that allows companies to deduct certain expenses relating to the acquisition of another company. This includes costs associated with pursuing and completing an acquisition, such as legal fees, financial advisors, and research and development.

Companies must meet certain requirements in order to take advantage of the M&A allowance. They must be resident in Singapore, the target company must be registered in Singapore, and the total value of the deal must not exceed S$10 million ($7.5 million USD). The M&A allowance can be used to reduce taxable income, but it cannot be used to offset other taxes or credits.

What are the benefits of the M&A Allowance Singapore?

The M&A Allowance Singapore is a tax incentive that can help companies undertake mergers and acquisitions (M&As) by reducing their tax liabilities. The M&A Allowance Singapore was introduced in 2014 as part of the government’s effort to support economic growth and job creation.

Under the M&A Allowance Singapore, companies can claim a deduction of up to S$500,000 ($390,000 USD) for expenses incurred in connection with an M&A transaction. Additionally, the transaction can be carried out using debt or equity, and the company does not need to own all of the shares in the target company before commencing the transaction.

The M&A Allowance Singapore is beneficial for both parties involved in a merger or acquisition. For the acquiring company, it allows them to reduce their tax liability while still ensuring they are able to take advantage of any potential synergies that may arise from the deal. For the target company, it provides stability and certainty during a difficult time, giving them time to focus on rebuilding their business rather than worrying about financial matters.

How to apply for the M&A Allowance Singapore

The M&A allowance Singapore is a government subsidy designed to incent mergers and acquisitions (M&A) in Singapore. The allowance is available to companies that have a total revenue of more than S$1 million and have completed at least two M&A transactions in the previous two years.

To qualify for the M&A allowance, companies must submit an application to the Economic Development Board of Singapore (EDB) together with supporting documentation. The application process can be time-consuming, so make sure to include all required documents and proof when applying.

Once your application is accepted, you will be notified of the amount you are eligible for and given a timeframe within which you must pay the applicable taxes and fees. If you fail to meet any of the deadlines, your application may be rejected or penalties may be imposed.

How to use your M&A Allowance Singapore

Mergers and acquisitions (M&A) are a common way for companies to grow and improve their competitive edge. To make the process go more smoothly, you’ll need to have a good understanding of your company’s M&A allowance. Here’s what you need to know:

The M&A allowance is a legal limit on the amount of money that a company can spend on an acquisition in one fiscal year. The limit is set by the Singapore Ministry of Trade and Industry (MTI). For fiscal year 2018, the MTI has set the M&A allowance at $43 million.

There are two ways to use your M&A allowance: You can use it all at once, or you can spread it out over several transactions. If you use your entire allowance in one transaction, you won’t be able to use it for future transactions for six months. If you use your allowance over several transactions, each one will count as only 50% of the total amount allowed for that fiscal year.

Before you make any decisions about using your M&A allowance, it’s important to understand your company’s financial situation and its goals for acquiring assets. This information will help you decide whether using all or part of your allowance would be best for your business.

There are a few things you should keep in mind during annual bookkeeping. First, it is important to know how much you can deduct. Second, you may want to consider whether any other expenses related to the deal should also be deducted. Finally, make sure all paperwork is filed correctly so that any deductions can be claimed.