Singapore is known for its favorable business environment. It has been ranked and recognized by many international organizations claiming as Asia’s best business epicenter. Here are several accolades presented to Singapore:
By prioritizing being Asia’s top-notch economy, Singapore has successfully implemented a rational tax system with low tax rates, a qualified and productive workforce, excellent infrastructures for businesses, a well-developed financial system, and an efficient process for company registration and incorporation all ready to be served to like-minded people who wants to start up a company.
Know this before starting a company in Singapore
Those who have the status of Singapore Citizen, Permanent Resident, or Passholder are qualified to start a business in Singapore. Let us dig deep into the factors that need to be considered before preparing your documents for company registration.
Choosing a company name
According to ACRA Singapore, a statutory board under the Ministry of Finance of the Singapore Government, if you are planning to start a company in Singapore, you must first choose a name appropriate for your company.
There are specific standards that need to be followed. Your proposed company name cannot be identical to another name already in use or contain any words that are unsuitable and prohibited.
When submitting a name application, you must also identify the activities of your business by selecting the most applicable Singapore Standard Industrial Classification (SSIC) code.
Determining your company structure
The structure is the backbone of the company. With it, you’d be able to work towards your company’s goal. Be sure what to add to your structure.
The first thing to decide is if you will run the business alone or with partners.
If you have the business on your own, you can file for Sole-Proprietorship. You will have total control of your business operations and all business responsibilities regarding debts and legal actions.
And if you decide to operate your business with partners, There are 3 types of structure that you can consider:
- Partnership: Similar to Sole-Proprietorship, except it contains 2 or more partners
- Limited Partnership (LP): With a minimum of 2 partners, including at least one general partner and one limited partner, that do not have a separate legal entity from the partners.
- Limited Liability Partnership (LLP): Two or more partners incorporate an entity separate from themselves
You can also have your business incorporated in Singapore as a Local Company. Your company will have the right to own a property and have perpetual succession. There are 7 different types that your company can fit in. Read this to know more about the 7 types of company:
- Exempt private company
- Private company limited by shares
- Public company limited by shares
- Public company limited by guarantee
- Unlimited private company
- Unlimited exempt private company
- Unlimited public company
Singapore company registration and its requirements
If you have decided to run a local company, you must know the following requirements to register as a Singapore company.
The company registration also requires appointing at least one director and a secretary with the following qualifications:
Singapore company registration - additional things to consider for foreigners
Here are a few things to consider if you are a foreigner planning to have a company in Singapore:
- A foreign entrepreneur residing in Singapore can apply for Entrepreneur Pass (EntrePass) from the Ministry of Manpower (MOM) to start a business
- A foreigner holding a Dependant’s Pass (DP) can apply for a Letter of Consent (LOC) from MOM if he wishes to start a business in Singapore.
- For Foreigners without Singpass, you will need to collaborate with a registered filing agent to apply for company incorporation.
- If you wish to operate your company outside of Singapore, you must have a local resident director manage your business in Singapore.
Incorporating your company in Singapore
Once you have all the prerequisites, you can submit your application via ACRA’s online business registration and filing portal, Bizfile.
It will cost you $15 for the name application and $300 for company registration. Payments can be made through credit/debit cards (Visa, MasterCard, or American Express), PayPal, Apple Pay, or Google Pay.
You can apply for the company name and company incorporation in a single application or 2 separate steps. If you choose to do it in 2 steps, you must provide the transaction number of your approved company name application to proceed with the “Incorporation of Local Company” transaction.
To make your registration more effortless, we have prepared a checklist of the essential requirements needed.
After your application is approved, Bizfile will email the appointed personnel (e.g., directors, shareholders, and secretary) to request their endorsement. They can also access the email from their BizFile personal dashboard. Within 60 days of receiving the email, all appointed personnel must endorse their appointments in BizFile. Otherwise, the application will be withdrawn.
These are the things that you will need to do and will be receiving after your registration.
- An official Certificate of Incorporation will be issued, including your business registration number. You can request a hard copy of the certificate to ACRA for only S$50.
- The company's identity card will be the free business profile that ACRA will provide.
- Register for Goods and Service Tax (GST) if your annual turnover exceeds S$ 1 million
- Apply for business licenses depending on your business activities
- Open a corporate bank account with any Singapore bank.
Receive the rewarding perks of being a Singapore company
Know that you are in good hands when you incorporate in Singapore. As a company running in Singapore, you can experience rewarding perks.
Business-friendly tax rates and tax incentives are implemented to encourage the growth of businesses. Favorable tax policies include
- Corporate income tax rebates: Companies are entitled to a 20%-50% rebate applicable for the Years of Assessment (YAs) from 2013 to 2020.
- Avoidance of Double Tax Agreements (DTA): Prevent double taxation of taxpayers' income if their company operates in Singapore and other countries.
- Start-up tax exemption: Companies are exempted for the first 3 years. For YA 2020 onwards, 75% of the first S$100,000 profits earned are exempted.
- Partial tax exemption: A chargeable income of S$ 300,000 will be exempted by 75% on the first $10,000 of chargeable income and 50% exemption on the next $290,000 of chargeable income
Hire easily from Singapore’s talent marketplace. With its recent 97.13% literacy rate, Singapore can proudly provide a talented pool of highly educated and English-speaking locals. Hiring foreign workers would also be easy since Singapore’s liberal immigration laws allow businesses to hire employees from any country they desire.
Also, experience Singapore’s world-class telecommunication system. Having a fast internet connection is a necessity in any business. Singapore’s Wi-Fi access points are available nationwide.
As the Singapore government works its best to provide the best system for companies, BLACAZ Startup and SME business insurance is here to support businesses' risk mitigation. Contact our insurance experts to discuss the best plan and coverage for your new venture needs.
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