OPENING A COMPANY IN SINGAPORE

open company in singapore

Registering/ opening a company in Singapore might seems as a Herculean task but is free of hassle and easy. In addition, the government offers tax exemptions to startups and helps them with a number of schemes in their initial days.

The Accounting & Corporate Regulatory Authority (ACRA) acts as the Company Registrar. It supervises the process for company registration in Singapore. It is as per the Companies Act, Chapter 50.

Vital Points for the companies:

  Companies registered in Singapore must have at least one shareholder and a maximum number of fifty.

  The shareholders may be corporate bodies or natural individuals.

  One resident must act as the manager of the company, but it may also have other local or foreign directors.

  Only natural persons above the age of 18 are accepted as company directors or managers in Singapore.

Forms of Companies in Singapore:

There are various types of companies in Singapore. These are:

  the sole proprietorship which implies very few requirements and is very easy to create;

  the partnership which can be general and limited and is not considered a legal entity separated by the owner;

  the private and public limited liability company which is the most employed type of company in Singapore;

  the subsidiary, the branch office and the representative office which are suitable types of business forms for foreign companies in Singapore.

A natural person, a local resident must be the secretary of the Singapore offshore company. It may not be at the same time shareholder of the company or manager. There is no authorized capital required at the incorporation of an offshore company in Singapore but a symbolic share capital of at least 1 dollar must be deposited. As an impediment, the Singapore legislation is not allowing a foreign entity to self-register as an offshore company; the process must be carried by a local professional agency.

Steps for Opening a Company in Singapore:

In respect of opening a company in Singapore, one needs to follow the requisite steps which are as follows:

  preparing of the incorporation documents for the future company in Singapore, which are represented by the Memorandum and Articles of Association;

  translation and notarization of the future business’ incorporation documents and the owners’ identification papers;

  obtaining the company’s seal, which is one of the first steps and a mandatory requirement in Singapore;

  filing all the documents with ACRA and obtaining the business license and the company’s business profile;

  registering with the Inland Revenue Authority in Singapore for taxation purposes and for obtaining a GST number.

  The business profile of the Singapore offshore company can be used when applying for various types of licenses.

Requirements for setting up a company in Singapore:

The requisites related to opening an offshore company in Singapore are the same as for an onshore business and will imply at least one shareholder, a director, and a secretary. However, in the case of the offshore company, one of the shareholders can take the role of a company director.

Where no resident director or secretary is available, this role can be taken by a nominee director or secretary.

Another requirement related to starting an offshore company in Singapore is having a legal address in the city-state.

The following documents must be presented for the company registration procedure of an offshore company in the Companies Registrar of Singapore:

  the passport copies of the shareholders and the managers,

  their residential addresses, as well as details regarding the parent company.

  First, the name of the offshore company must be approved by the Companies Registrar. If it’s available, it will be reserved until all the registration procedures are finished.

Then, the company will be registered with ACRA (Accounting and Corporate Regulatory Authority) which will issue its certificate of registration.

Next is the registration for the Goods and Service Tax at the Inland Revenue Authorities of Singapore.

Some activities require using a license which must be issued by relevant authorities. After these licenses and permits have been obtained, the company may start its business.

Advantages of opening a company in Singapore:

First of all, the registration procedure is very easy, and the process is made online, so the bureaucracy is almost inexistent.

Another major reason is the small taxes and sometimes their absence related to the company’s activities. For example, the capital gains are not taxable; also, there is no tax on dividends.

If a company is formed by less than 20 shareholders (from which one is keeping 10% of the shares), in the first three years the company is subject to a 0% tax rate on the first 100000 Singapore dollars taxable incomes. The profits up to 300000 Singapore dollars are taxed with a corporate income tax of 8.5% and a flat 17% for above 300000 Singapore dollars.

The foreign source income, not delivered in Singapore, is exempt from Singapore fees. Also, the foreign source of income that meets certain conditions received in Singapore may be exempt from these taxes.