2021 is an opportune time to register your company quickly and seamlessly in Singapore. As economic indicators and business activity look better and better by the day, particularly in Asia, Singapore is an ideal location to setup a company to take advantage of the ease of doing business in the region and has a stable socio-economic and geopolitical environment and outlook.
Since foreign business owners are not permitted to set up a company via a self-registration, they must seek services of Singapore-based company registration providers. Singapore has been conducive for foreign business activity for decades and Piloto Asia can help in advising what is type of business to set up based on your specific needs, do the necessary paperwork and stay on top of any subsequent regulatory compliance.
Furthermore, foreign business owners will need a Singapore work visa, which Piloto Asia can also deftly guide in the processing of, coming to a resolution swiftly.
Choosing your business structure
All business owners would need to decide what type of business they should set up. They can choose from a Sole proprietorship, a Private Limited Company, or a Limited Liability Partnership (LLP). There are many different variables that can decide which structure is best for your business needs, depending on size, number of business owners partnering in the business, and the type of legal protection afforded to each business type. Below is a general breakdown of the pros and cons of each structure.
|• The quickest and easiest to set up and operate|
• Minimal compliance needs.
• Easy to wind up.
|• Company profits are taxed at the personal income tax rate|
• Owner directly liable
• Annually renew registration
• Not a separate legal entity
Limited Liability Partnership (LLP)
|• A separate legal entity|
• As the name suggests, the liability of partners is limited
• A moderate level of compliance nePeds
|• Need at least 2 business owners|
• Company profits are taxed at partners’ personal income tax rate
Private Limited Company
|• A corporate tax rate that is very competitive internationally|
• A separate legal entity with limited liability protection of shareholders
• Ease of setting up
|• A high level of regulatory compliance|
• Shareholders must abide by a strong Code of Conduct
• Incorporation process complex and expensive
• Windup process is complex
What you need to do
Once you have decided on a business structure, the registration process can start. In Singapore, the company registering authority is the Accounting & Corporate Regulatory Authority (ACRA), and businesses must setup and stay in compliance with Chapter 50 of the Companies Act.
Businesses would also need to identify and then file details of who the important persons are of your businesses, how much you’re investing in paid up capital, among other requirements. Below is a breakdown of some basic requirements that need to be decided on in order to register the firm.
- Name of the company name – This has to be approved by ACRA and then registered with them. The name is an important part of a company registration. In order for the name to be approved by ACRA, it has to be unique, cannot be obscene or include bad language, and cannot be in violation of any copyrights or trademarks. If the name of the business includes “education,” “bank,” “finance,” etc, it must have the appropriate licensing from the relevant industry regulatory bodies.
- ACRA maintains a website in which businesses can register their company name, https://www.bizfile.gov.sg/. Once your company name is approved, it is valid for 60 days from the day you applied.
- Pick a Director – You would need to decide how many directors your business will have. It is important to remember that a minimum of one director must be a Singapore citizen, a Permanent Residence-holder, or a person with an EntrePass
- Number of shareholders: Private Limited company must have at least one shareholder and 50 shareholders at maximum.
- A local address – The business needs to have a local company address that will be included in the registration documents.
- A Company Secretary – Your business would need to hire a Company Secretary within six months of the date of the company registration.
- Company Paid-Up Capital – It is important to remember, that at least S$1 must be shown as the initial paid-up company capital.
Registering the Company
Okay, you’ve decided Singapore is the place to start your new business. You’ve considered the different business structures and have picked one that is right for you. You’ve proceeded to hire a local director and have chosen to work with Piloto Asia as your Singapore-based company registration provider to carry out the registration. Below are the steps that we will carry out in registering your company.
- Pick a name – come up with a few variations that are unique and such a name that has not already been taken. It can be registered on ACRA site bizfile.gov.sg and we will carry out the remaining particulars within the next 60 days.
- Start preparing registration documents that detail;
- the nature of business and the activities carried out by your company
- A Singapore address of your company
- Details about the shareholders and the stake they hold in the company
- Profiles of the director that will be employed by the company
- A copy of the passport for all foreign business owners
- A copy of Singapore identity cards for all Singapore residents
- Memorandum and Articles of Association of all foreign entities
Once all details and particulars have been compiled for an application to ACRA, the final step of the process is to submit the application. Although that is more than sufficient time, if need be, an extension application can be filed with ACRA.
After you’ve submitted your company registration application, you will receive an email from ACRA notifying you of the registration. This email notification which includes the registration number is considered a legal document, the Certificate of Incorporation for your business in Singapore.
Shortly after, you can request a copy of the official Company Business Profile, which ACRA will send you within an hour of the request via email in PDF format. The Company Business Profile includes your company name, registration date and number, details about main business activities, paid up capital, and information on shareholders and directors.
These e-certificates, or digital legal documents will serve as the cornerstone of conducting business operations in Singapore, such as renting office space, opening a corporate bank account, and accessing services.
What comes after registration
Once registration is complete, its not all smooth sailing. Your company will still need to perform several steps for compliance with Singapore regulation, some on an ongoing basis. Let’s start the one-time tasks that need to be handled immediately.
Initial Board Meeting – as soon as a company has been registered, an initial board meeting must convene for the appointment of person(s) to carry out specific business tasks such as hiring/selecting a company secretary, auditor, among others.
Registration for Goods & Service Tax (GST) – If your company revenue will exceed S$1 million annually, your company has to apply for GST registration, at which point your invoices will need to include the 7% GST. The GST funds collected, and pertinent GST filings must be deposited with the Inland Revenue Authority of Singapore (IRAS).
Finally, there are periodic compliance needs which are summarized below.
Accounting – Companies must carry out needed bookkeeping and prepare financial statements in accordance with Singapore Financial Reporting Standards (SFRS).
Annual General Meeting (AGM) – Companies need to hold an AGM every year and include the companies’ most recent financial statements in agenda.
Annal Returns – A month after the AGM, the company must file financial statements as part of its Annual Returns with ACRA.
Tax Filing – there are numerous tax filings that all types of companies are required to do and can include corporate tax filings, GST tax filings, Non-resident Withholding tax filings, Estimated Chargeable Income (ECI) among many more.
Audits – Depending on the size of your business, shareholder rights, or bank/loan covenants, you may need to have your financial statements audited annually.
Setting up a business in Singapore is easier than ever. The country is known for its ease of doing business, rule of law, human and capital rights and is ideally situated in the heart of Asia free from any socio-economical or geopolitical issues.
Piloto Asia can advise on a range of business formation issues and specializes in registering business in Singapore for over a decade. So let’s get the ball rolling by visiting our dedicated webpage here: https://www.pilotoasia.com/services/company-incorporation-singapore
This content is brought to you by the FingerLakes1.com Team. Support our mission by visiting www.patreon.com/fl1 or learn how you send us your local content here.