Clause 21

by deleting subsection (1) and substituting the following subsections:“(1) Subject to this section, where the Comptroller is satisfied that a qualifying person has incurred, during the period between 1 July 2016 and 31 December 2021 (both dates inclusive), qualifying expenditure in respect of —

the provision during that period by a qualifying employee of the qualifying person, of services that satisfy subsection (2) to an IPC; or

the secondment during that period of a qualifying employee of the qualifying person to an IPC,then there is to be allowed to the qualifying person a deduction in accordance with subsection (1A) or (1B), as the case may be.(1A) Where the qualifying expenditure is salary expenditure, the deduction that the qualifying person is to be allowed is as follows:

where —

the expenditure is allowable as a deduction under section 14; and

the qualifying person did not opt in the declaration under subsection (6) to compute the expenditure at the prescribed hourly rate,a further deduction equal to 150% of the endorsed amount of the expenditure in addition to the deduction allowed under section 14;

where —

the expenditure is allowable as a deduction under section 14; and

the qualifying person opted in the declaration under subsection (6) to compute the expenditure at the prescribed hourly rate,a further deduction equal to 150% of the computed salary amount in addition to the deduction allowed under section 14;

where —

the expenditure is not allowable as a deduction under section 14; and

the qualifying person did not opt in the declaration under subsection (6) to compute the expenditure at the prescribed hourly rate,a deduction equal to 250% of the endorsed amount of the expenditure;

where —

the expenditure is not allowable as a deduction under section 14; and

the qualifying person opted in the declaration under subsection (6) to compute the expenditure at the prescribed hourly rate,a deduction equal to 250% of the computed salary amount.(1B) Where the qualifying expenditure is not salary expenditure, the deduction that the qualifying person is to be allowed is as follows:

where the expenditure is allowable as a deduction under section 14 — a further deduction equal to 150% of the endorsed amount of the expenditure in addition to the deduction allowed under that section; (b)where the expenditure is not allowable as a deduction under section 14 — a deduction equal to 250% of the endorsed amount of the expenditure.”;

by inserting, immediately after subsection (5), the following subsection:“(5A) Where a qualifying person opted in a declaration under subsection (6) to compute any salary expenditure at the prescribed hourly rate, then the computed salary amount —

is treated as the amount of that expenditure incurred by the qualifying person for the purposes of subsections (3) and (5); and

is to be used in computing the maximum amount of qualifying expenditure for which deductions may be allowed in relation to the IPC in question for the purposes of subsection (4).”;

by deleting sub-paragraph (ii) of subsection (6)(b) and substituting the following sub‑paragraph:“(ii)the relevant details specified in subsection (6A); and”;

by inserting, immediately after subsection (6), the following subsection:“(6A) In subsection (6)(b)(ii), the relevant details are —

where —

the qualifying expenditure is salary expenditure; and

the qualifying person opted in the declaration under subsection (6) to compute the expenditure at the prescribed hourly rate, the actual number of hours for which the services were provided, as well as the number of those hours (which may be the same number or a smaller number of hours) endorsed by the IPC for the deduction under subsection (1); or

in all other cases, the amount of the actual qualifying expenditure incurred, as well as the part of that amount (which may be the full amount or a part of it) endorsed by the IPC for the deduction under subsection (1).”;

by inserting, immediately after the word “expenditure” in subsection (10), the words “or the endorsed number of hours (as the case may be)”;

by inserting, immediately after subsection (11), the following subsection:“(11A) Where —

the qualifying expenditure mentioned in subsection (11) is salary expenditure; and

the computed salary amount of that expenditure was used to compute the amount of deduction allowed to the qualifying person, then, for the purpose of that subsection, the amount of the deduction that corresponds to the expenditure reimbursed is to be computed using the formulawhere —

A is the amount of the reimbursement;

B is the amount of the actual salary expenditure;

C is the prescribed hourly rate used in computing the computed salary amount; and

D is the endorsed number of hours used in computing the computed salary amount.”;

by inserting, immediately after the definition of “central hiring arrangement” in subsection (12), the following definition:“ “computed salary amount”, in relation to any salary expenditure for the provision of any services by a qualifying employee, means an amount computed using the formula A × B, where —

A is the endorsed number of hours for those services; and

B is the prescribed hourly rate for those services;”;

by deleting the words “subsection (6)(b)” in the definition of “endorsed amount” in subsection (12) and substituting the words “subsection (6A)(b)”;

by inserting, immediately after the definition of “endorsed amount” in subsection (12), the following definition:“ “endorsed number of hours”, in relation to any services, means the number of hours for which those services are provided, as endorsed by an IPC under subsection (6A)(a);”;

by inserting, immediately after the definition of “IPC” in subsection (12), the following definition:“ “prescribed hourly rate”, in relation to the provision of any services by a qualifying employee, means the rate prescribed by rules made under section 7 for those services;”;

by deleting the words “under which the employee is required to work for at least 35 hours each week,” in the definition of “qualifying employee” in subsection (12); and

by deleting “2018” in subsection (13)(b) and substituting “2021”.