A component of Singapore’s annual budget, unveiled on 18 February, was a five-year extension of dual tax incentives for insurers operating in the city state.
The Insurance Business Development umbrella scheme and the IBD-Captive Insurances scheme are to be extended till 31 December 2025, which entitles the participating insurers to a concessionary tax rate of 10%.
In an effort to simplify the IBD umbrella scheme, the IBD-Marine Hull and Liability Insurance Business scheme will be superseded will instead receive the same benefits through under the IBD scheme. All new and renewal IBD scheme awards granted on or after 1 April 2020 will run for five years.
Under the existing IBDCI scheme, approved insurers will find the concessionary tax rate of 10% will apply on qualifying income from the onshore and offshore life reinsurance, onshore and offshores general insurance and reinsurance, with the exception of fire, motor, work injury compensation, personal accident and health insurance.
The IBD-MH scheme affords qualifying insurers a concessionary tax rate of 10% for five years on qualifying income derived from onshore and offshore MHL insurance and reinsurance.
A move by the Hong Kong Government to provide tax concessions for marine insurers and reinsurers in October 2018, was introduced to the Legislative Council in December 2019. In line with the 2018 policy address, the amendment bill will eventually implement tax relief proposals allowing for a 50% concession on corporate tax usually charged at 16.5%.
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