Company Registration Singapore
Company Registration Singapore
Singapore is considered as one of the best places for doing business and making investments. It is known for its transparent and fair legal and business systems that attract many local and foreign investors. If you are considering putting up your business or company in Singapore, you need to know the legal ways in setting up your company. The taxes you pay in Singapore depend on the kind of business you have and the opportunities of expanding it in the future. If you are considering borrowing money for the expansion of your business, then, it will affect the amount of tax you will have to pay the government of Singapore.
The following are some helpful tips on how to incorporate your business in Singapore.
Types of Businesses in Singapore:
You need to determine the kind of business you are going to put up in Singapore. This will be the basis of the different factors like the type of ownership and control, legal exposures and risks, taxation, compliance, and the ease of setting up your business and exit.
Sole Proprietorship refers to a kind of business where the owner is the sole owner of all the assets of the company. All profits will go to the sole owner. However, this kind of business is not lawfully considered as separate legal entity in Singapore and therefore, any liability met by the owner is a risk. He/She bears all the losses alone. The creditors can ask for personal assets from the company owner in case he/she is not able to pay off his loans. In this kind of business, there is greater risk of financial loss for those who do not know about the effects. If you intend to put up this kind of business, you must have enough resources to protect your losses, just in case.
Partnership is setting up a business together with somebody called partnership. The legal presence depends on the two partners and any of the partners who may not be able to continue his/her duties because of his/her death or retirement may result to termination of the business. Another drawback in partnership is that any of the partners may apply for dissolution of the partnership. Those who are planning to put up partnership should know the risks before going into partnerships.
Business Trust refers to a trust that is for business operations of company. You have to register the company trust and whoever heads the business trust is called as trustee-manager. The trustee-manager handles the business and heads its expansion and growth. He/She manages the business on behalf of its beneficiaries and unit holders. Potential investors and unit holders may have financial interests in the assets of the business trust but they do not have any rights over assets. These business trusts will be advantageous to companies who are already stable in terms of income from their present assets.
Foreign Companies may build their presence in Singapore through putting up their branch office, or subsidiary, or representative office.
- Subsidiary company refers to private limited company which is incorporated in Singapore with its parent company as the major shareholder. This type of business is most preferred in Singapore for the small and medium-sized foreign companies.
- Branch Office is recorded as an extension of the parent company and it is not as a separated incorporated entity. Any liability of the branch office is handed to its parent company.
- Representative Office is registered as a temporary entity in Singapore for doing some marketing research campaigns. It has no legal status and it will not be allowed to engage in any profit activities.
The process of corporate registration in Singapore is unique due to its cultural practices. But due to the increasing demand of business openings in Singapore, it has found a better alternative in doing business through outsourcing some non-core company services such as accounting, bookkeeping, human resources, and even in registering a business in Singapore.
How to Choose the Kind of Business to Incorporate in Singapore
This option depends on the nature of your business, business directions and plans. Here are some tips to help you select the business to incorporate in Singapore:
- If you are an individual native from Singapore and you want to register as small entrepreneur and you are the sole owner and the nature of your business does not too much risks or liabilities, opt for the Sole Proprietorship. If there are more than two owners, then you can register as partnership entity. In this kind of business, make sure that there is a partnership agreement signed by both parties which determines the roles of every partner, the profit sharing or liability and other details and responsibilities. In partnerships, your personal assets are unprotected from risks.
- If your company intends to give professional services such as lawyer, accountant, and the like, and you have more than one partner in similar venture or profession and are interested to build joint practice/services, LLP is a good choice.
- Incorporate private limited company in Singapore is ideal although there are more requirements compared to partnership and sole proprietorships.
Company incorporation or registration in Singapore can be conducted through outsourcing companies. Most of these experienced and reputable outsourcing companies provide extensive services in business formation, ranging from collecting information up to the completion of the company registration. They assist on incorporating the private company limited in Singapore through shares or guarantees; incorporating a limited liability partnership or LLP; registering a branch in Singapore; registering a business like partnership or sole proprietorship; acquiring offshore companies like Cayman Islands; and helping with incorporations outside Singapore like Thailand, HongKong, China, and more.