{"id":50998,"date":"2026-08-26T08:04:54","date_gmt":"2026-08-26T08:04:54","guid":{"rendered":"https:\/\/www.you.co\/biz\/?p=50998"},"modified":"2026-08-26T08:04:54","modified_gmt":"2026-08-26T08:04:54","slug":"petty-cash","status":"publish","type":"post","link":"https:\/\/www.you.co\/biz\/blog\/petty-cash\/","title":{"rendered":"Petty Cash for Small Teams: A Practical Singapore Guide"},"content":{"rendered":"\n

Running petty cash well comes down to receipts, regular reconciliation, and keeping records for five years.<\/strong><\/h2>\n\n\n\n
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Petty cash<\/strong> is a small amount of physical cash kept on-site for minor, day-to-day expenses that aren’t worth paying by bank transfer, cheque or card. Common examples include courier fees, a client’s coffee, printer paper or a taxi to a meeting. As a practical starting point, S$200 to S$500 is enough for many small teams, but the right amount depends on how much cash your business actually uses. There’s no legal cap on the amount.<\/p>\n\n\n\n

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Most businesses run petty cash on the imprest system<\/strong>. You fix the float at a set amount, assign it to one custodian, and top it back up to that same figure whenever it runs low. The cash remaining plus the vouchers held should always add up to the float.<\/p>\n\n\n\n

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The record-keeping obligation is the part most teams underestimate. Under the Income Tax Act 1947 and the GST Act 1993, you’re required to keep your business records for five years<\/strong>. If your records are inadequate, IRAS may estimate your income or disallow expenses and GST claims. Failing to keep proper records is an offence that can carry a fine of up to S$5,000<\/strong>.<\/p>\n\n\n\n

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Petty cash works well when it’s managed properly. It’s simply a manual process, so it costs you a custodian’s time, a monthly reconciliation, and a paper trail you need to keep safe.<\/p>\n\n\n\n

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Quick Answers: Float Size, Records, GST and When to Stop<\/strong><\/p>\n\n\n\n

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Question<\/strong><\/strong><\/th>Short Answer<\/strong><\/strong><\/th><\/tr><\/thead>
How much should we hold?<\/strong><\/td>Enough for about a month of small spending. S$200 to S$500 suits most small teams. No statutory limit applies.<\/td><\/tr>
Is it an asset or an expense?<\/strong><\/td>An asset. Petty cash sits on the balance sheet as a current asset until it’s spent.<\/td><\/tr>
What does IRAS want us to keep?<\/strong><\/td>Receipts and vouchers for every payment, kept for five years. Physical or electronic form both count.<\/td><\/tr>
Can we claim the GST back?<\/strong><\/td>Only if you’re GST-registered and hold the right document. At S$1,000 or below including GST, a simplified tax invoice covers it.<\/td><\/tr>
When should we drop it?<\/strong><\/td>When reconciliation takes longer than the spending is worth, or when receipts start going missing.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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The most common problem isn’t theft. It’s a S$14 taxi fare with no receipt, repeated dozens of times a year, that your accountant can’t substantiate and IRAS won’t accept. Managing the cash is straightforward, but maintaining the paper trail behind it is where most teams struggle.<\/p>\n\n\n\n

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Table of Contents<\/strong><\/h2>\n\n\n\n
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  1. What Is Petty Cash<\/strong><\/a><\/li>\n\n\n\n
  2. What Counts as a Petty Cash Expense<\/strong><\/a><\/li>\n\n\n\n
  3. How Much Should You Keep in the Float<\/strong><\/a><\/li>\n\n\n\n
  4. The Imprest System: How the Float Works<\/strong><\/a><\/li>\n\n\n\n
  5. Is Petty Cash an Asset or an Expense?<\/strong><\/a><\/li>\n\n\n\n
  6. How to Record Petty Cash<\/strong><\/a><\/li>\n\n\n\n
  7. The Petty Cash Voucher and Petty Cash Book<\/strong><\/a><\/li>\n\n\n\n
  8. How to Reconcile Petty Cash<\/strong><\/a><\/li>\n\n\n\n
  9. What IRAS Expects You to Keep<\/strong><\/a><\/li>\n\n\n\n
  10. Claiming GST on Petty Cash Purchases<\/strong><\/a><\/li>\n\n\n\n
  11. Where Petty Cash Breaks for a Small Team<\/strong><\/a><\/li>\n\n\n\n
  12. When to Replace Petty Cash with Corporate Cards<\/strong><\/a><\/li>\n\n\n\n
  13. FAQs<\/strong><\/a><\/li>\n<\/ol>\n\n\n\n
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    What Is Petty Cash?<\/strong><\/h2>\n\n\n\n
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    Petty cash is an on-site cash reserve for minor, day-to-day business expenses.<\/p>\n\n\n\n

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    It’s designed for convenience. For example, processing a payment run for an S$8 courier fee can take more time and effort than the expense itself.<\/p>\n\n\n\n

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    Who holds it:<\/strong> Assign one named custodian, typically an office manager or admin lead. Having one person accountable makes it easier to track and reconcile the cash.<\/p>\n\n\n\n

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    Where it lives:<\/strong> Keep the cash in a lockable box or drawer. The custodian holds the main key, with a spare kept by a director.<\/p>\n\n\n\n

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    What makes it a system, not just a cash tin:<\/strong> Every payment should be recorded with a signed voucher, so the cash on hand plus documented expenses always accounts for the full petty cash balance.<\/p>\n\n\n\n

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    Best for:<\/strong> Businesses with a physical office, regular small cash expenses, and an admin person who can take responsibility for managing and reconciling the fund.<\/p>\n\n\n\n

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    What Counts as a Petty Cash Expense<\/strong><\/h2>\n\n\n\n
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    These are the expenses a small Singapore team typically pays from the float:<\/p>\n\n\n\n

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