Classify the rights acquired
The sheet distinguishes a right to use software, full economic and legal ownership, and software developed by the taxpayer. The contract’s rights matter more than whether the product arrived in a box, by download or bundled with hardware. This undated sheet is a compact comparison, not a complete account of every assessment-year option or later legislative change.
Only a right to use
For software that gives the purchaser no rights beyond usage, the sheet identifies a one-year write-off under section 19A(2). Its examples include packaged software, a download from the licensor’s designated network, a site licence and software pre-installed in hardware. Acquisition with hardware does not automatically mean ownership of the software copyright.
Full economic and legal ownership
For a purchaser obtaining more than usage rights, the sheet gives a five-year write-off under section 19B. The bundle may permit modifying the program and exploiting its copyright, including licensing end-users. A licence labelled “perpetual” should not be assumed to confer this entire bundle; identify the rights actually granted. The five-year entry reflects the supplied sheet rather than a claim that no other statutory option can exist.
In-house or outsourced development
For software developed by the taxpayer, whether in-house or outsourced, the sheet describes possession of all associated rights, interests and benefits. It lists development expenditure claims under sections 14, 14D, 14DA or 14E where their conditions are met, and a one-year section 19A(2) write-off if those conditions are not met. The references require assessment-year and provision-specific checks; the comparison does not establish that a project qualifies as research and development.
Records for the classification
Keep acquisition or development contracts showing permitted use, modification, copyright exploitation and ownership. Separate the nature of the rights from the payment method or invoice description. Use this source to understand its three categories, then apply the legislation and detailed IRAS guidance relevant to the actual claim period.
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.
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