How to Claim Vehicle Expenses in Singapore (2026 Guide)

Quick answer

In Singapore you cannot claim motor vehicle expenses on a private (S-plate) car, or on a Q-plate or RU-plate business car registered on or after 1 April 1998, even if the car is used wholly for business and even if the cost is paid as a reimbursement ^[1] . The GST on those cars is disallowed too ^[4] . Goods and commercial vehicles such as vans, lorries and buses are deductible, and so are public transport, taxi and ride-hail fares for business journeys ^{[1] [2]} .

Are car expenses tax deductible in Singapore?

This is the sharpest difference between Singapore and other countries. IRAS allows motor vehicle expenses on goods and commercial vehicles (repairs, maintenance, parking fees and petrol are its examples) and allows nothing on private cars and business cars registered on or after 1 April 1998, whether the business pays directly or reimburses someone ^[1] . The prohibition sits in the Income Tax Act, so the general “wholly and exclusively” test ^[2] never gets a chance to apply: a car used 100% for client visits is treated exactly like one used for the school run.

IRAS publishes the edge cases in a table. Here is the same table in plain words ^[1] :

Hiring a car does not escape the rule. IRAS draws the line between transportation services and private hire car expenses: paying to be carried from one place to another without control or possession of the car is a deductible transportation service, while hiring a private car and running it is not deductible unless your business is hiring out cars or teaching people to drive ^[1] .

What you can claim instead

IRAS’s own list of deductible expenses includes transport by public transport and by goods or commercial vehicles, travelling, and reimbursements to employees for transport on business, overtime transport included ^[2] . The same list marks as non-deductible any transport on S-plate, Q-plate and RU-plate cars, private hire car costs, and reimbursements for ordinary commuting between home and the office ^[2] .

On the employee side, the treatment follows the nature of the payment ^[7] :

• A fixed monthly transport allowance is taxable to the employee (and deductible to you).
• Reimbursing expenses incurred on official duties is not taxable to the employee.
• Reimbursing mileage on an employee’s private car for specific business trips is not taxable to the employee, but reimbursed private mileage is; and remember the reimbursement is not deductible to the business in either case, because it is an S-plate car expense ^[1] .
• A taxi between home and the office is not taxable to the employee only when they are working overtime; in every other case it is a taxable benefit ^[7] .

Commercial vehicles are the other half of the answer. A van or lorry used in the business deducts its running costs, claims its GST, and claims capital allowances on the purchase; the vehicle purchase guide covers the capital side, and the fuel guide covers the pump.

GST on vehicles and fares

Regulation 27 of the GST (General) Regulations disallows input tax on the purchase and running expenses of motor cars used by you or your employees, including a car driven by a chauffeur to carry directors or a car used to transport clients for a fee ^[4] . A motor car for this purpose is a vehicle built or adapted to carry not more than seven passengers excluding the driver with an unladen weight of not more than 3,000 kg; lorries, vans and motorcycles fall outside the definition and their input tax is claimable when the ordinary conditions are met ^[4] .

Three things changed recently and are worth knowing ^[4] :

• From 1 April 2022, input tax on the purchase of pay-per-trip chauffeured private hire car services (airport transfers, for example) is claimable, provided you hold a tax invoice or simplified tax invoice showing GST charged.
• From 1 January 2023, input tax on expenses for a motor car used by a third party is claimable, such as parking charged to you when customers park at your premises.
• Expenses on a motor car used by a connected person, such as a subsidiary, stay blocked unless you recover the cost and the recovery is not ancillary to another supply.

The GST calculator extracts the 9% from a GST-inclusive fare, and the Singapore GST guide covers the input tax conditions in full.

How much can you claim?

Worked example one. A company owns an S-plate car used only for client visits, spending $9,000 a year on petrol, servicing and parking. None of it is deductible and none of the GST is claimable, because the prohibition applies regardless of business use ^{[1] [4]} . Had the same trips been taken by ride-hail for $4,000 including GST, the full fare would be deductible as a transportation service and the GST claimable from the receipts ^{[1] [4]} .

Worked example two. A plumbing firm runs a van and pays its two technicians a $200 monthly transport allowance for the days they use their own cars. The van’s petrol, servicing and parking are deductible and its GST is claimable. The allowances are deductible to the firm but taxable to each technician as employment income ^{[1] [7]} . If the firm instead reimbursed the technicians’ petrol receipts for their own cars, the reimbursement would not be deductible at all ^[1] .

Record-keeping requirements

Because private car costs are not deductible, the records that matter are for the transport that is: receipts or tax invoices for taxi, ride-hail and chauffeured rides, with the business purpose noted; commercial vehicle running costs tagged to the vehicle; and payroll records for any transport allowance. For input tax, a simplified tax invoice is enough for purchases of $1,000 or less including GST ^[4] . Keep records for five years, as the Singapore record-keeping guide sets out.

How to claim, step by step

1. Classify every vehicle by its plate: S, Q or RU car (blocked) or goods and commercial vehicle (claimable).
2. Post car costs to their own account so the add-back in the tax computation is mechanical, and code their GST as blocked.
3. Deduct the running costs of commercial vehicles and claim their input tax from tax invoices.
4. Route people movement through fares: public transport, taxis and ride-hail, reimbursed against receipts, or a transport allowance run through payroll.
5. Do not reimburse employees’ private car costs expecting a deduction; IRAS lists that reimbursement as non-deductible.
6. Keep receipts, purpose notes and payroll records for five years.

Common mistakes

• Claiming petrol, servicing or parking on a company car used for business. The plate decides it, and the answer is no ^[1] .
• Claiming input tax on a company car or on a car hired for staff use ^[4] .
• Assuming a reimbursement of an employee’s car costs becomes deductible. IRAS lists it as non-deductible ^[1] .
• Treating a transport allowance as tax-free for the employee. It is deductible to you and taxable to them ^{[1] [7]} .
• Reimbursing the daily commute and deducting it. Home-to-office travel is personal unless the employee is working overtime ^{[2] [7]} .
• Missing the GST on ride-hail receipts since 1 April 2022, which is now claimable with a simplified tax invoice ^[4] .

Software that helps

The deductible transport is fares, so the win is capturing every taxi and ride-hail receipt with the right GST code.

• Grab for Business issues itemised receipts and monthly statements for business rides.
• ExpenseFlow captures taxi, ride-hail and commercial vehicle receipts, applies the Singapore GST treatment (blocked for cars, claimable for other vehicles and for pay-per-trip rides), flags a running cost that reads as a private passenger car, and syncs the coded transaction to Xero or QuickBooks after approval.
• Xero Singapore edition maps local fares to the standard-rated input code and carries the fixed-asset register for the commercial fleet.

FAQ

See the answered questions above for the private car prohibition, deductible alternatives, GST, fares and reimbursements.