Preparatory work is different
Incorporation, signing contracts, obtaining finance or constructing infrastructure can be preparatory activities rather than business commencement. IRAS examines the main business, its profit-making structure, day-to-day operations and a chronology of key events. The guide illustrates a supermarket commencing when it offers goods to the public and a manufacturer when commercial production starts; neither a later ceremony nor the first sale necessarily controls. Hotels and other industries have their own operational facts.
Interaction with pre-revenue relief
Ordinary section 14(1) deduction does not apply to expenses incurred before actual commencement. The separate section 14R regime can allow qualifying revenue expenses using a deemed commencement date linked to the first business receipt and the preceding-year enhancement. A business can substantiate actual commencement earlier than that deemed date. Keep the chronology and expenditure classification together, and analyse the ordinary deduction and statutory concession separately rather than assuming every pre-sales cost is either deductible or permanently disallowed.
Official source
A concise, independent Apex Gateway guide based on the official English source, not a reproduction of the complete document. Consult the original for full conditions, exceptions and subsequent updates.
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