---
title: "Start-Up Tax Exemption (SUTE) Guide | Singapore SMEs"
description: "Learn about the Start-Up Tax Exemption (SUTE) in Singapore. Find out if your newly incorporated SME qualifies for up to $125k in tax relief."
url: "https://corporate.taxinfo.sg/startup-tax-exemption"
language: "en"
---

Tax Exemptions

# Start-Up Tax Exemption \(SUTE\)

Find out if your newly incorporated company qualifies for Singapore's generous tax exemption scheme for startups.

![Illustration of a plant growing from coins, representing Singapore startup tax exemptions](https://23eyzuj14s.koniglecdn.com/images/singapore-startup-tax-exemptions.webp)

## What is the Start-Up Tax Exemption?

Introduced to encourage entrepreneurship, the Start-Up Tax Exemption \(SUTE\) scheme provides significant tax relief for qualifying newly incorporated companies during their first three consecutive Years of Assessment \(YAs\).

## How Much is the Exemption?

For qualifying startups, the exemption is applied to normal chargeable income as follows:

  * **75% exemption** on the first $100,000 of normal chargeable income.
  * **50% exemption** on the next $100,000 of normal chargeable income.

This means if your startup makes a taxable profit of $200,000, you will only be taxed on $75,000. Any remaining income above $200,000 will be taxed at the standard corporate rate of 17%.

## Who Qualifies for SUTE?

To be eligible, your company must meet all three of the following conditions:

  1. The company must be incorporated in Singapore.
  2. The company must be a tax resident in Singapore for that YA.
  3. The company's total share capital must be held directly by no more than 20 shareholders throughout the basis period. In addition, all shareholders must be individuals, OR at least one individual shareholder must hold at least 10% of the issued shares.

## Who Does Not Qualify?

The SUTE scheme is not available to:

  * Companies whose principal activity is investment holding.
  * Companies engaged in property development for sale, investment, or both.

These companies can still claim the standard Partial Tax Exemption \(PTE\).

## What Happens After 3 Years?

From your fourth YA onwards, your company will no longer qualify for SUTE. Instead, you will automatically transition to the Partial Tax Exemption \(PTE\) scheme, which is available to all companies.