If you’ve decided to set up a business in Singapore, then you will have a number of questions about the incorporation process. While you could scour the internet to find the answers, there are no guarantees that what you see is correct or represents current rules and regulations.
This is when using the services of a company that specializes in company incorporation can save you time, money, and stress.
Before We Begin What Needs to Be in Place?
As with every country in the world, there are some basic requirements for setting up a company in Singapore. This includes –
- A company name that has been approved in advance by the Accounting and Corporate Regulatory Authority (ACRA).
- There must be at least one resident director for the company registration process. But that doesn’t mean to say that this is the only director appointed during the company registration process. You can also appoint further resident and non-resident directors as required by your company’s organizational structure.
- Singapore private limited companies may have a minimum of 1 and a maximum of 50 company shareholders. Shareholders can be individuals, other legal entities such as your BVI company or a trust. It’s worth knowing that 100% foreign shareholding is allowed for Singapore private limited companies.
- A registered address in Singapore. It’s important to know that this must be a physical address and not a PO Box and that it can be either residential or commercial.
- Appoint a Company Secretary within six months of the incorporation.
- A minimum of S$1 of issued share capital.
With those sorted, we can look at the three advantages of incorporating your business in Singapore.
- Business Friendly Taxes
For most people, this is enough to give Singapore a second look! While they say there is nothing certain in life other than taxes and death, if a company can reduce its tax burden, that has to be a good thing.
Here are three key facts to know about business tax in Singapore –
- The Singapore corporate tax system utilizes a single tier income tax rate system. This means that profits are taxed at a corporate level. As a result, when dividends are paid to shareholders, the funds won’t be taxed again, at a personal level.
- The standard corporate tax rate in Singapore is 17%. There is, however, a partial tax exemption for the first SGD 300,000 of chargeable income. This currently allows 75% of the first SGD 10,000 of chargeable income to be tax-exempt along with 50% of the next SGD 290,000 of chargeable income.
- Singapore has Double Tax Agreements (DTA) in place with a wide range of countries across the world. This means that individuals have certainty regarding when and how tax is to be imposed, and it defines the jurisdictional authority on cross-border transactions. It also means that it’s possible to claim tax relief for taxes paid overseas.
- Ease of Capital Access
There comes a time when a business will need additional capital to enable continued growth. Knowing that the infrastructure is in place to gain competitively priced financing is an important consideration.
Singapore is ranked fourth in the Global Financial Centres Index, with New York, London and Hong Kong taking the top three places. In addition to this, Singapore is the biggest foreign exchange centre in Asia.
And there is no lack of choice, with over 120 commercial banks in operation offering a wide range of financing options for businesses of all sizes.
3. Excellent Infrastructure, Support Network and Strategic Location
Combined with the financial appeal, Singapore has an infrastructure and location that makes it highly appealing to the business entrepreneur.
Strategic Location
Singapore’s strategic location places it right between the key Asian trading routes coming from both the east and the west. Singapore makes it easy to conduct business due to its proximity to developing countries within a seven-hour flight journey away.
Excellent Infrastructure
Then there’s the ease of access by both air and sea. Singapore has a solution no matter what or who needs to be transported. The award-winning Changi International Airport and one of the busiest container ports in the world make this possible.
Highly Educated Workforce
Singapore’s culture places considerable value on education. This is seen in the country’s success in league tables, where it consistently hits the top places. As a result, there is a highly educated workforce in place, with nearly half of the population continuing their studies into Higher Education.
The challenge of finding well educated, literate, and hardworking employees is not an issue in Singapore.
Safe Environment
Not only is it important to have a productive workplace, but it’s also crucial for both you and your workforce to be safe in their home. Singapore has one of the lowest crime rates in the world, with a homicide rate of just 0.7 per 100 thousand population compared to the US rate of 5 per 100 thousand.
The Singapore Government reports that over 94% of their population feel safe when walking alone at night compared to a worldwide figure of 69%
It should be no surprise then that Singapore continues to be a desirable location for expatriates when taking all of this into account.
For more information, please visit Piloto Asia website.