Last updated: 11 November 2026
The Enterprise Innovation Scheme (EIS) gives a business up to a 400% tax deduction on qualifying staff training fees, or a 20% cash payout on part of that spend. IRAS runs the scheme, and the rules below come from the IRAS page on the Enterprise Innovation Scheme. This is general information and not tax advice, so check the IRAS page or ask a tax adviser before you file.
What is the Enterprise Innovation Scheme?
The EIS was announced in Budget 2023. It enhances tax deductions for qualifying activities, and training is one of them. Eligible businesses can also convert part of their qualifying spend into a non-taxable cash payout. The scheme runs for a set range of years of assessment, so check IRAS for the years that currently apply.
Which training qualifies for the EIS?
IRAS says the course must be eligible for funding from the Skills and Workforce Development Agency (SWDA) and aligned with the Skills Framework. Qualifying spend means course fees that the employer pays, directly or by reimbursement, to a funded course provider, including certification and assessment fees.
A few rules shape the amount:
- IRAS works out the claim on the fee net of any government grant or subsidy received for the course, so the SSG/SWDA subsidy (SSG stands for SkillsFuture Singapore, now part of the Skills and Workforce Development Agency, SWDA) lowers the amount you can claim.
- The fee counts as incurred when the training provider invoices the business.
- Only training attended within the course’s supporting period qualifies, and IRAS links to a list of EIS eligible courses with those periods.
- If an employer reimburses an employee for part of a fee that the employee paid with their own SkillsFuture Credit (SFC), that part earns no EIS benefit.
How much can a business claim?
For training, the deduction is 400% on the first S$400,000 of qualifying spend in a year of assessment. That is the usual 100% deduction plus an extra 300%. Spend above S$400,000 keeps the 100% deduction.
The alternative is a cash payout. A business can convert up to S$100,000 of qualifying spend across all its qualifying activities in a year of assessment at a rate of 20%, which caps the payout at S$20,000. The payout is not taxable. The converted amount can no longer be deducted, the choice cannot be reversed, and IRAS says it is an offence to claim the enhanced deduction on spend that you have converted to cash.
The example below is invented for illustration.
| Route | What you claim | If the company pays S$10,000 in qualifying fees |
|---|---|---|
| Tax deduction | 400% of qualifying spend, up to S$400,000 | S$40,000 of deductions |
| Cash payout | 20% of converted spend, up to S$100,000 converted | S$2,000 in cash |
Who can use the EIS?
IRAS lists sole proprietorships, partnerships, companies, registered business trusts, registered branches and subsidiaries of a foreign parent or holding company. The business must carry on active operations in Singapore and incur the spend in the basis period of the year of assessment.
The cash payout has more conditions:
- The business must have at least three full-time local employees. IRAS counts a business that makes CPF contributions for at least three local employees for at least six months in the basis period.
- A full-time employee is a Singapore Citizen or Permanent Resident who earns at least S$1,400 a month and works at least 35 hours a week. Sole proprietors, partners and director-shareholders are excluded.
- The business must file its Income Tax Return before the due date and incur at least S$400 of qualifying spend.
- Investment holding companies, clubs and associations and charities are among the businesses that are not eligible for the payout.
How do you claim the EIS on training?
For the tax deduction, a company declares the enhanced deduction in the Enterprise Innovation Scheme section of its Corporate Income Tax Return. A sole proprietorship or partnership includes it in allowable business expenses and submits the details through the Submit EIS Enhanced Deduction/Allowance Records digital service.
For the cash payout:
- File your Income Tax Return for the year of assessment.
- Apply through the Apply for EIS Cash Payout digital service in myTax Portal before the filing due date. IRAS accepts one application for each year of assessment.
- Keep your invoices and related records for seven years, because IRAS may select the claim for review.
IRAS says it generally processes a cash payout application within three months of receiving the complete application and any supporting documents.
Is there an EIS deduction for AI tools?
IRAS also lists a separate deduction for qualifying AI expenditure, such as subscriptions to AI systems. It has its own cap, applies for a limited number of years of assessment and has no cash payout option. Check the IRAS page for the current terms.
How does the EIS fit with other funding?
The EIS works on what your company pays after other funding. Our guide to Absentee Payroll funding covers help with staff time, the guide to the SSG/SWDA course fee subsidy and net fee explains the fee your company pays, and the guide to funding for AI and skills training in Singapore compares every scheme.
Ask our team about staff training
QD Academy’s courses are taught by practitioners and funded for eligible learners. Our team checks which schemes apply to your company and helps with the paperwork and claims for our own courses. See the Grants and Subsidies page for our calculators, or open a course page: Developing an Effective Customer Journey Map Using AI and Automation, AI-Powered Productivity Strategies for the Modern Workplace or Mastering AI for Sales Growth and Team Dynamics. Check the course page for the latest dates, fees and funding.
Is the EIS a grant?
No. It is a tax measure run by IRAS. You claim the enhanced deduction in your Income Tax Return or apply to IRAS for the cash payout.
Can I claim the deduction and the cash payout on the same training spend?
No. The converted amount is no longer available for deduction, the choice cannot be reversed, and IRAS says claiming the enhanced deduction on spend that you converted to cash is an offence.
What is the most the cash payout can be?
S$20,000 for each year of assessment, which is 20% of up to S$100,000 of qualifying spend across all qualifying activities.
Does the course need to be on a list?
Yes. The course must be eligible for SWDA funding and aligned with the Skills Framework, and IRAS links to a list of EIS eligible courses with their supporting periods.
Do I need three local employees to claim the tax deduction?
No. The three full-time local employee condition applies to the cash payout. The tax deduction requires active business operations in Singapore and qualifying spend in the basis period.