Companies can now enjoy tax deductions of 250 per cent when their employees help out at institutions of a public character (IPCs).
The initiative, called the Business and IPC Partnership Scheme, was introduced in the Budget this year to encourage people to use their skills to help such organisations.
IPCs are charities authorised to receive tax-deductible donations. They include Oh! Open House, which organises art walks, and SOSD, a body that helps stray dogs.
Under the scheme, a business that assigns an accountant to help a charity with its books could claim 250 per cent of the employee's monthly wage in tax deductions.
Employees can help IPCs by using their professional skills, but offering general skills such as mentoring children and organising events can also qualify for the scheme, which kicks in today.
There is a cap of $250,000 in expenditure that companies can claim, meaning the total amount of tax deductions a business can have each year is $625,000.
It's great because it encourages companies to donate services. We have actually been hearing from companies that they are sick of donating money and want to help in other ways.
DR SIEW TUCK WAH, president of SOSD, is optimistic about the scheme.
The scheme, which runs until December 2018, is administered by the Ministry of Finance, Inland Revenue Authority of Singapore and the Office of the Commissioner of Charities.
Mr Francis Huan, head of corporate communications at tech firm Crimson Logic, said the initiative would enable the company to put in more resources into its corporate social responsibility (CSR) efforts. "We have already planned our budget this year, but the tax deduction is a nice bonus which could give us more room in our budget next year to do more CSR."
The company plans to work with the PPH Community Services Centre, a charity in Teban Gardens, to run several one-day IT and coding camps for students, some of whom may come from disadvantaged backgrounds.
Mr Huan said about 50 to 80 employees will be involved in the camps, which aim to reach about 80 to 100 children between the ages of seven and 12.
Dr Siew Tuck Wah, president of SOSD was optimistic about the scheme. "It's great because it encourages companies to donate services. We have actually been hearing from companies that they are sick of donating money and want to help in other ways," he said.
"People on the ground, such as employees, are keen to volunteer their services, but sometimes management isn't keen so this scheme could help facilitate more volunteering of services."