How to Set Up your Business in Singapore
As you have landed on this page, you may be looking for some useful tips for starting and setting up a business venture in Singapore.
Among other reasons, more and more companies and professional individuals have chosen Singapore to set up their businesses or even expand their companies in Singapore. Popular reasons for choosing Singapore are as follows:
- Singapore offers unrestrictive business opportunities
- Singapore has advanced systems and facilities conducive for business transactions and activities
- Singapore provides flexible and easy immigration system and policy
- Singapore offers simple and easy system for setting up your company and business
- Singapore is known as having the most favorable tax rates and tax incentives in Asia
- Singapore has diversity pools of skilled and professional human resources
- Singapore offers intellectual property rights protection
- Singapore is known for its high quality of life in Asia
Setting up your company in Singapore
If you are seriously considering establishing your company or business in Singapore, you have to know the basic information, such as:
- All companies or businesses should be registered with Accounting & Corporate Regulatory Authority or ACRA; this applies to any person or corporation or company with business in other countries
- A foreign company who is interested in setting up a branch in Singapore has to appoint two local agents to act on their behalf; they must be legal residents in Singapore, foreigners with employment or dependent passes from the government
- You need to get special licenses if your business involves insurance, banking, stock broking, and manufacturing of cigars and firecrackers.
To register your business in Singapore, you do not have to be a Singaporean. You just need to send application to get the Employment Pass. There are reliable agencies or consultants who can assist you to get this Employment Pass. They can even help you register your company in Singapore.
In Singapore, you will undergo three major steps to register your company: Pre-Registration, Registration, and Post-Registration.
- Pre-Registration involves providing the government with the fundamental information about your company, such as
- Name of your Business/Company
- Company Directors: there should be a minimum of one resident director who is a resident or citizen of Singapore, or an individual with Entrepass, or Employment Pass, or Dependent Pass; there is no required number of additional local or foreigner directors; they must be 18 years and do not have any records of bankruptcy or malpractices.
- Shareholders. Private limited company registered in Singapore may have a minimum of one and maximum of 50 shareholders; the director and shareholder can be different entity or same persons; shareholder may be an individual or another entity officially appointed by the company.
- Company Secretary. This individual should be officially appointed as secretary for about 6 months of its incorporation.
- Paid-Up Capital. The minimum paid-up capital to be able to register in Singapore is S$1 which maybe increased any time after the incorporation of the company.
- Registered Company Address. You should have a local and physical address in Singapore, which may be a residential or commercial, but not P.O. Box.
- Taxation. For the first S$300,000 yearly income, your company pays below 9% while flat 17% after this; you need not worry about capital gains and dividend taxes in Singapore. You may read Singapore corporate tax guide for more information.
As for the required documents, you will have to prepare and submit the following:
- Company Name
- Concise Description of Business Transactions
- Shareholders Profiles
- Director Profiles
- Secretary Profile
- Registered Business/Company Address
- Memorandum & Articles of Association or MAA.
Company registration in Singapore is done through online by the Singapore of Registrar of Companies. This system ensures quick and efficient processing of your company/business. It will take one to two days to register your business.
There are two basic steps in setting up company in Singapore: approval of your Company Name and Company Registration. If there are no major problems or delays, these steps can be completed in one day.
For company name reservation and to have higher chances of approval of your company name, make sure that:
- The company name is not identical or similar to any existing business names
- The company name has not violated with any trademark policy
- The company name is not vulgar or offensive
- The company name is not yet reserved by other entities
The approved company name should be booked within 60 days from the application date.
When company name is approved, you can file the incorporation request from the Registrar of Companies which can be completed within several hours.
The company will receive the following official documents:
- Certification of Incorporation. You will receive an email notifying the approval of incorporation of the business, including the business registration number. By default, Singapore does not anymore issue a hard copy of this incorporation. However, if you wish to have a hard copy of the certificate of incorporation, you may request online to the Company Registrar.
- Company Business Profile that denotes the particulars of the business may be requested online with a small application fee. One hour after the request is made, the file in PDF format will be available for download.
- Other additional documents that you may need upon the incorporation of your business in Singapore are as follows: share certificates for each of the shareholder, share register which specifies the shares for each shareholder, Seal of the company, and official rubber stamp for the business.
Company Bank Account
Once your business has been officially registered, you can open company bank account in major banks such as Citibank, HSBC, DBS, Standard Chartered, OCBC, etc.
Business licenses will depend on your company transactions. Only few business entities need business licenses, including educational institutions, travel agencies, restaurants, financial services, importing/exporting of goods, and more.
If you are projecting yearly taxable supplies that is more than S$1 million, you must register your business for GST, which is also known as Value-Added Tax in other countries. Once your business is registered to GST, you will be able to charge tax to your customers on the goods and services that you provide. You will have to pay this GST collected on behalf to IRAS. Present GST tax rate is 7%.
Once your business is fully incorporated, don’t forget to file your corporate income tax annually!