You are required to keep records and be able to explain ALL expenditure relating to assets.
Asset Details
A business usually has a number of assets, such as plant and equipment and motor vehicles. You need to keep the following details and documents for each of the assets:
(a) Date of purchase and cost
(b) Date of sale and sale price (if applicable)
(c) Copies of contracts of purchase and sale (e.g. hire purchase agreements)
(d) Invoices
You are advised to prepare a fixed asset schedule at the time you start your business so that you can record the assets purchased, the dates of purchase and their costs. You may want to refer to the sample “Fixed Asset Schedule” at Appendices 8A and 8B.
Capital Allowances
The amounts incurred in purchasing these assets are capital in nature and are not deductible for tax purposes. However, you may claim capital allowances. For more information on capital allowances, please refer to IRAS website (http://www.iras.gov.sg). You should keep records of capital allowances you have already claimed as deductions so that you can calculate your entitlement to capital allowances in subsequent years.