Scope of the January 2026 eighth edition
Section 14 N allows qualifying capital renovation/refurbishment costs incurred from 16 February 2008 by a trade, business or profession. Ordinary repair/replacement without improvement is instead considered under section 14(1)(c); plant/machinery may qualify for capital allowances under 19/19 A. Do not claim two deductions on the same cost. The twenty-page guide includes eight FAQs and four deduction examples.
Three-year write-off or irrevocable one-year election
Normally deduct one third in each of three consecutive YAs from the year incurred, without deferral. The one-year option applied to expenditure in basis periods for YA 2021, YA 2022 and YA 2024 and is permanently available from YA 2025. The YA’s election is irrevocable. These assessment years differ from the financial years in which the expenditure arises.
S$300,000 expenditure cap, not an annual allowance
The cap applies to qualifying expenditure incurred in each relevant three-year period. Before YA 2025 periods start at first claim and continue consecutively, even without costs in a year; before YA 2013 the cap was S$150,000. From YA 2025 all taxpayers share fixed periods YA 2025–2027, 2028–2030, 2031–2033 and so on, each S$300,000. This caps the cost pool, not separately every year’s deduction including earlier instalments.
Partnership, sole proprietor and shortened activity
Apply the cap at partnership level; one sole proprietor shares it across all trades. A business not operating throughout the fixed period still receives the full cap without proration: a company commencing in YA 2026 has S$300,000 for YA 2026/2027. A mismatched old period receives a refreshed cap at YA 2025. Existing three-year deduction instalments continue subject to the trade-continuation condition.
Business continuation, losses and relief
Deduct against that business’s income after other Part 5 deductions. Unabsorbed amounts become trade losses, available for carry-forward under 37, group relief under 37 B and carry-back under 37 D subject to those conditions; group relief applies from YA 2013. No deduction is given for a YA with no business income where the business permanently ceases during its basis period.
Structural changes and exclusions
Structural works requiring Building Control Commissioner approval are excluded; absence of a requirement for prior approval supports qualifying treatment. Antiques, fine art and employee residential premises are excluded. Designer/professional fees were excluded before YA 2025; from YA 2025 non-structural services qualify. The works must actually satisfy the conditions, rather than becoming eligible merely because required approval was never sought.
All nineteen listed qualifying-work examples
Subject to the non-structural rule and exclusions, examples are general electrical installation/wiring; lighting; hot/cold water systems; gas; kitchen fittings; sanitary fittings; doors/gates/shutters; fixed partitions; wall coverings; floors; false ceilings/cornices; non-fine-art decorations; canopies/awnings; windows/grilles/frosting; retail fitting rooms; hacking; renovation water meters; hoarding; and insurance for qualifying renovation. An item’s label alone does not override structural or personal-use restrictions.
Claim timing, pre-business costs and mixed-use premises
Claim when filing the YA in which costs first arise; missed costs do not qualify in a later YA. Pre-commencement costs are deemed incurred on the first business day. For home offices/mixed-use premises only specifically identifiable business-area costs qualify. If they cannot be identified, no general apportionment is permitted. Replacement of a previously deducted item can independently qualify under 14(1)(c), but not also under 14 N for that replacement cost.
FAQ 2: the old-period cap calculation
YA 2019–2021 costs S$200,000, zero, S$110,000 are capped at S$200,000, zero, S$100,000. YA 2022–2024 costs zero, S$100,000, S$240,000 are capped at zero, S$100,000, S$200,000. The second period starts in YA 2022 despite no expenditure then. A first claim in YA 2020 would instead create YA 2020–2022 and 2023–2025 periods before the fixed-period transition.
FAQ 3 A: an aligned transition
An old YA 2022–2024 period has costs zero/S$100,000/S$240,000 with the final year capped at S$200,000. New YA 2025–2027 costs S$300,000/S$50,000/S$10,000 qualify only S$300,000/zero/zero because the refreshed fixed-period pool was exhausted in YA 2025. The source’s statement of no further deduction for later costs does not cancel eligible instalments of previously admitted expenditure.
FAQ 3 B: a mismatched old period resets
The old YA 2023–2025 period had S$200,000 and S$50,000 already used, so normally only S$50,000 of YA 2025’s S$300,000 would fit. The YA 2025 reset instead admits the full S$300,000; YA 2026 S$120,000 and YA 2027 S$150,000 then admit zero. The earlier S$250,000 does not reduce the new fixed-period cap.
Deduction examples 1 and 2: write-off and cessation
S$240,000 incurred on 31 January 2018 yields S$80,000 each in YA 2019/2020/2021. If the business permanently stops on 31 December 2019, only YA 2019/2020 S$80,000 each are allowed; the last S$80,000 is not deducted in YA 2021 with no subsequent business income. These are historical illustration dates.
Example 3: overlapping deductions do not reset the pool
The example assumes first claim YA 2015, making YA 2018–2020 and YA 2021–2023 consecutive pools. Costs in YA 2019/2021/2022/2023 are S$240,000/S$210,000/S$30,000/S$90,000. The last is capped at S$60,000 because the latter pool already used S$240,000. Electing one-year for YA 2021/2022 yields deductions YA 2019 80,000; YA 2020 80,000; YA 2021 290,000 (80,000+210,000); YA 2022 30,000; YA 2023 20,000.
Example 4: the fixed pool and old instalments coexist
Add S$180,000 in YA 2024 over three years and S$210,000 in YA 2025 over one year. YA 2024 deduction is S$80,000 (20,000 old+60,000 new); YA 2025 is S$290,000 (20,000+60,000+210,000); YA 2026 S$60,000; YA 2027 zero. The refreshed YA 2025–2027 expenditure pool includes S$210,000, while prior admitted-cost instalments continue. This separates eligible expenditure, annual deduction and cap tracking.
Evidence, election and incorrect structural claims
Show the one-year election in the tax computation; simplified returns reflect the resulting allowable expenses. Retain itemised work/costs and premises addresses, confirmation no structural approval is required, invoices and payments; submit evidence only if IRAS requests. If structural costs were wrongly deducted, the total incorrect deductions become taxable in the discovery YA. Fraud/wilful default can trigger additional assessments at any time under 74(2) and penalties.
Investment businesses and the amendment history
Section 10 D investment businesses can claim for qualifying renovation of properties rented in their business. The history records 2012 removal of the end date/cap increase/group relief, 2013 evidence-submission relaxation, 2018 employee-residence exclusion and more items, 2020/2022 one-year options and section renumbering, and 2024’s permanent option, non-structural professional fees and fixed periods. The guide prints IRAS company/individual enquiry contacts 1800-3568622 and 1800-3568300.
Official source
This article independently explains the substantive contents of the official PDF, including the relevant conditions, procedures and annexes. The linked document remains the authoritative source for its original wording, and later changes should be checked separately.
Read the official PDF ↗