For over a decade, Healy Consultants has efficiently and effectively assisted our local and international Clients start a business in Singapore and launch their Asian business. In our opinion, a Singapore business entity is the most tax efficient corporate structure in the world. The following information will assist your Firm determine whether Singapore company formation is the optimum corporate solution to fulfill your international business objectives:
Due to the positive image of Singapore, Singapore business registration is an excellent corporate vehicle to promote to customers, suppliers, investors, venture capitalists, governments and banks. Official global comparisons of jurisdictions by respected organisations like Mercer and WTO confirm Singapore structures are secure long-term solutions compared to traditional tax havens like BVI or Cayman Islands.
If properly structured, Singapore company offshore profits are legally tax exempt, as outlined by the Inland Revenue Authority of Singapore website. For onshore profits, the first S$200,000 (approximately US$158,000) of corporate profits earned in Singapore is legally tax-exempt for the first three years of business trading.
A Singapore company is not perceived as an offshore company in a tax haven. Singapore is a reputable, highly regulated, international trading jurisdiction. Singapore is positively ranked the 5th least corrupt country in the 2012 Corruption Perceptions Index by Transparency International.
Singapore is the most proficient English speaking country in Asia, thus a strategic advantage for western companies setting up regional or global headquarters.
Following Singapore corporate formation, an annual statutory financial audit is not required if corporate turnover/sales is less than S$5 million (US$3.99 million) and there is no corporate shareholder.
Singapore has tax treaties with approximately 86 countries, including 69 comprehensive double tax treaties, minimizing withholding tax on funds transfers between countries. Singapore is also a member of ASEAN meaning free trade access (such as no import duty) with Indonesia, Malaysia, the Philippines, Thailand, Brunei, Burma, Cambodia, Laos and Vietnam.
To counter the effects of the global economic downturn, the Singapore government offers a range of incentives and initiatives to assist investors choosing to register a company in Singapore.
Singapore is an excellent location to register intellectual property (IP), including global trademarks and patents. Singapore is a signatory to international conventions including the World Trade Organisation's (WTO) Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), which helps protect against IP rights infringements. Healy Consultants assists clients to complete Singapore, and international, trademark registration.
In accordance with Section 145 (1) of the Singapore Companies Act 1963, Singapore company incorporation requires appointment of at least one director who is ordinarily resident in Singapore. Mr Aidan Healy will act as your Firm's resident director in Singapore, which will help with business registration, corporate bank account and visa approval.
Because so many international companies wish to designate Singapore as their Asian headquarters, Singapore is increasingly becoming an expensive city to base a business. The relentless rise in property prices is just one factor contributing to Singapore's alarming 6th position in the latest Mercer Human Resources' global Cost of Living Survey. As a services and export-based economy, Singapore is vulnerable to i) high global oil and food prices and ii) the health of the global economy.
Annual unaudited financial statements must be submitted to the Inland Revenue Authority of Singapore (IRAS) following Singapore company incorporation. Healy Consultants assists our clients efficiently and effectively complete this annual statutory obligation.
Prior to the Singapore company setup, our client a) settles Healy Consultants' fees and b) signs and returns our Client Engagement Letter and c) provide us all the required due diligence documents.
Healy Consultants drafts a detailed Singapore company setup engagement project plan for our client, including corporate bank account opening steps. This engagement project plans maps out by week each step to engagement completion, optimising transparency and setting Client expectations.
After the corporate structure is agreed with our Client, Healy Consultants will prepare incorporation forms for client signature and courier return. Thereafter Healy Consultants legally incorporates the Singapore company and immediately emails to out Client i) the public profile for the company and ii) the certificate of incorporation.
Our Clients usually requests Mr. Aidan Healy to be the Singapore resident director to comply with Section 145 (1) of the Singapore Companies Act 1963. Alternatively, our Clients can appoint their preferred local director.
After starting a business in Singapore, Healy Consultants assists our client open a corporate bank account. The majority of our clients choose either a Singapore corporate bank account or a Hong Kong corporate bank account to support their company, for either i) tax efficiency reasons ii) because both jurisdictions are major global financial centres and iii) banks in Singapore and Hong Kong offer multi-currency accounts and world-class Internet banking facilities.
Where possible, Healy Consultants bank account opening team will liaise with the bank to prevent our Client having to travel for an account opening interview.
Following engagement completion, Healy Consultants couriers a full company kit to our client, including original Singapore corporate documents, unopened bank correspondence and a client feedback survey.
To support the Singapore company startup, Healy Consultants provides our client a Singapore business address for invoicing purposes. Additionally, many clients request telephone, fax and email support for their company following entity establishment. Alternatively, our client may request a full Singapore virtual office, or rent office space at Healy Consultants' head office in Singapore.
Healy Consultants assists clients to find business premises in Singapore and recruit local and expatriate staff by placing advertising campaigns in local publications such as the Straits Times.
While the Singapore visa application process is a straightforward one, the Singapore government has tightened the controls on obtaining employment passes and permanent residence visas. This is to manage the number of foreigners working in Singapore and maintain adequate opportunities for Singaporeans.
Singapore visa and employment pass options include: regular employment pass (EP), personalized employment pass (PEP), EntrePass, EP eligibility certificate (EPEC), foreign worker work permit (FWWP), foreign domestic worker work permit (FDWWP), S Pass, dependent's pass (DP) and long term visit pass (LTVP).
Singapore Permanent Residence (PR) is also available to foreigners. The two avenues to becoming a Singapore PR are via a Global Investor Program or by meeting the criteria determined by the Immigration & Checkpoints Authority (ICA) which assesses time living in Singapore, education, employment, income etc.
Healy Consultants will assist our Client set up the optimum Singapore corporate structure.
Comparison of different types of corporate structures:
Type of Singapore Company
LLC
Branch
LLP
Rep Office
Can legally trade in Singapore and issue invoices
Yes
Yes
Yes
No
Can open a bank account in Singapore
Yes
Yes
Yes
Yes
Enjoys limited liability in Singapore
Yes
No
Yes
No
Minimum number of shareholders required
1
Parent Company
2
2
Minimum number of directors required
1
0
2
2
Singapore resident director required
Yes
2 local agents required
No
No
Singapore company secretary required
Yes
Yes
Yes
Yes
Annual Return required
Yes
Yes
Yes
Yes
Submit annual tax return
Yes
Yes
No
No
Corporate directors allowed
No
N/A
No
No
Singapore tax payable
17%
17%
0%
0%
Legal tax exemption if properly structured
Yes
Yes
Yes
Yes
Office premises mandatory
No
No
No
No
Allowed to hire staff
Yes
Yes
Yes
Yes
Limited liability company
This is the most common entity used for doing business in Singapore. It is also known as a private limited (Pte Ltd). As always, the company is a separate legal entity or 'person'. In particular, a company is separate from its owners, shareholders and the persons who run it, the directors.
Singapore Branch
The establishment of an Singapore branch may be preferable to incorporating a subsidiary if one of the objectives is to consolidate the financial results of the parent company.
An overseas company may register itself in Singapore to operate as a branch, instead of as a subsidiary. The branch must formally establish a registered office in Singapore and appoint a local resident agent.
Representative office
Where a foreign company does not intend doing business in Singapore it may seek to establish a representative office. Such an office must however only engage in activities which will not amount to carrying on business, for example market research.
Companies limited by guarantee
Instead of shareholders and paid up share capital, this company comprises members who place a guarantee on the company which is only enforced on the winding up of the company. Often non-profit companies and charities use this method.
Unlimited liability companies (partnerships)
An entity whose members have no limit placed on their individual liability to contribute to the debts of the company. The sole advantage is this company can distribute profits without restriction.
Public Companies
A public company usually comprises more than 50 shareholders and a minimum of 3 directors, 2 of whom must ordinarily reside in Singapore. This entity type is subject to more stringent regulatory provisions.
Private Superannuation Trustee Company
The sole purpose of this company is to act as a trustee of a regulated superannuation fund within the meaning of s19 of the Superannuation Industry (Supervision) Act 1993.
Not-for-profit Company
This company is for charitable purposes only and its constitution will i) require the company to apply its income in promoting those purposes and ii) prohibits the company making distributions to its members and paying fees to its directors.
Sole trader
The business is run by one person, all decisions are made by this person but staff can still be hired. Sole traders do not enjoy limited liability and personally liable for all debts of the business.
The average fees per Singapore engagement amounts to US$9,350, including company incorporation, resident director, corporate bank account, virtual office address and GST registration or exemption. Refer to draft invoice embedded here.
Healy Consultants recommends international banks HSBC, Standard Chartered and Citibank for most corporate bank account solutions, due to the best internet banking and customer service. Local banks can be used where appropriate for the Singapore business.
Healy Consultants will assist our Clients open a corporate bank account in Singapore without our Client traveling to meet the bank. Usually, it takes 4 weeks to obtain corporate bank account approval and activate internet banking. Following bank account approval, the preferred Singapore bank will directly and independently email our Clients the corporate bank account number.
Singapore banks will provide finance to a registered company if the following conditions are met i) good Business-plan and feasibility study ii) availability of security iii) business owners have suitable experience iv) last 3 years audited financial statements v) project strength and weaknesses analysis (SWOT).
To support their company registration in Singapore, Healy Consultants assist clients with Trade finance tasks including i) bank guarantees ii) letters of credit iii) finance against trust receipt iv) document against payment and against acceptance.
Securing Singapore corporate finance in the form of a loan, overdraft or simply preferential credit terms are other services provided to support clients opening a business in Singapore.
As a global financial hub, Singapore bank accounts offer the highest levels of corporate bank account facilities. These include multiple currencies, internet banking, telephone banking, checking accounts, savings accounts, debit and credit cards, fixed term deposits and wealth management services.
Refer to table below to view different banking options in Singapore.
Healy Consultants Compliance Department assists our Clients to efficiently and completely discharge the annual accounting and auditing obligations of their Singapore company.
Healy Consultants assists our Clients with i) documenting and implementing accounting procedures ii) implementing financial accounting software iii) preparation of financial accounting records and iv) preparing forecasts, budgets and sensitivity analysis to better manage financial obligations and ease the process of reporting to Singapore accounting authorities.
If properly structured, a Singapore non-resident company offshore profits are legally tax exempt, as outlined by the Inland Revenue Authority of Singapore website. A resident Singapore company suffers corporate tax of 17% on annual profits. However, the first S$200,000 (approximately US$160,000) of corporate profits earned in Singapore is legally tax-exempt for the first three years after business registration in Singapore. To highlight Singapore's tax advantages, private companies voted Singapore as the country with the least burdensome taxes in the world, according to a survey by Grant Thornton International.
Singapore companies must conduct an independent annual audit only if i) if corporate turnover/sales is more than S$5million (US$3.99 million) or ii) if the Singapore company has a corporate shareholder.
A Singapore resident company is only obliged to register for goods & services tax (GST) if annual sales exceed S$1 million (US$800,000).
There is no capital gains tax in Singapore.
Tax planning in Singapore is straightforward compared to most jurisdictions. Singapore tax laws are simple and pro-business. When tax planning in Singapore, taxes are levied only on income earned in Singapore and provided the income is not remitted back to Singapore. Refer to the Inland Revenue Authority of Singapore (IRAS) website for more information.
Unlike many corporate services providers, Healy Consultants takes a global approach to our Singapore tax planning services. Our Singapore tax consultants think 'outside the box' to provide a creative solution. Our international tax professionals provide legal, creative solutions.
A Singapore company accesses double taxation treaties signed with 69 countries including Japan, China, Germany, France, the UK and Canada. In some instances, a Singapore company may be liable to pay income tax despite a double tax treaty being in place. In this case, the tax rate depends on the terms of the treaty, and may be reduced through tax credits. Our Singapore tax consultants can provide further information.
Each Singapore company must appoint a local company secretary.
Singapore business registration requires having a registered office in Singapore.
A Singapore company must have at least one director who is "ordinarily resident in Singapore" i.e. Singapore Citizen, Singapore Permanent Resident, or a person who has been issued an Entrepreneur Pass or Employment Pass and must be above the age of 18 years.
Each Singapore company must fix its financial year end (FYE).
GST registration is required only if the company falls under the following:
The turnover is more than S$1 million for the past 12 months - known as the retrospective basis, or;
There is a reason to expect that the turnover will exceed S$1 million for the next 12 months - known as the prospective basis
Each Singapore company must keep such accounting and other records as are necessary to explain the transactions and financial position of the company and to allow a profit and loss account and a balance sheet to be prepared.
As a director of the company, one shall disclose to the company:
Any material personal interest they have in a matter which relates to the affairs of the company
Any other interest which the Director believes is appropriate to disclose in order to avoid an actual conflict of interest or the perception of a conflict of interest
Each time a change occurs in the particulars of the company or to its officers, the change must be lodged with Registrar of Companies.
The Singapore Companies Act now requires every company to have the registration number (in addition to its registered name) on all business letters, statements of account, invoices, official notices and publications.
Each Singapore company must file annual return with Company Registrar and annual tax return with the Inland Revenue Authority of Singapore (IRAS).
Foreigners doing business in Singapore can contact local firms directly to arrange a business meeting, however, introductions or referrals will help to make your Singaporean contacts feel more comfortable. Having a third party whom they know to set up, or be involved in your meeting can be beneficial.
The exchange of business cards is an important aspect of doing business in Singapore, as in other parts of Asia. A business card should be given to everyone attending the meeting. When handing a business card to someone it should be held by the top corners with the thumb and index finger of both hands with the front of the card facing the recipient, making it easy to read. When receiving a business card, take time to look at and read the card as a sign of respect.
When entering a meeting room, let the senior member lead, followed by the next senior member, hierarchy is important in Asian cultures. The meeting hosts will sit facing the visiting party, with persons of equal rank sitting opposite each other.
When doing business in Singapore, all businesses will deal with government agencies on a regular basis. Foreigners starting a Singapore business should exercise restraint and be patient as much as possible as Government authorities would always have the final say in any matter.
As not all local Singaporean companies are well-versed with international trade, we encourage our Clients to consistently use and sign contracts of service.
Grants and other funding programs are available from the Singapore government. There are grants and other assistance available in many categories, including developing your business, innovation and exporting. Healy Consultants assists our clients locate the grants and assistance programs most relevant to your business.
Listing on the Singapore Stock Exchange (SGX) is a corporate advisory service our staff assist clients with. This process can include preparing feasibility studies, ensuring compliance with SGX regulations, advice on risk management, effective tax structure and more. For more information, visit our Singapore Stock Exchange listing services webpage.
Healy Consultants provides our Clients with i) nominee Singapore shareholders and directors and ii) professional agents and distributors. Detailed due diligence is available for each Singaporean national.
Some of our Clients require Healy Consultants virtual office for six months until a full time business office in Hungary is found. Alternatively, Healy Consultants will assist our Client find office premises and or warehouse space. Healy Consultants assists our Clients secure a family home for the foreign entrepreneur and his expatriate staff. With a network of agents and property owners all over Hungary, allow us to project manage your family migration.
Entrepreneurs completing business formation in Singapore benefit from the country’s numerous Intellectual Property laws. Healy Consultants will assist our Clients with trademark and patent registration. Registering your brand, trademark and designs is particularly important in Asia.
Healy Consultants offers a comprehensive range of Singapore research services including i) industrial or business analysis ii) economic and political overview iii) competitor analysis iv) customer analysis v) regulation analysis vi) market entry strategies vii) business partner matching viii) SWOT analysis ix) financial projections x) location and site evaluation xi) business life cycle analysis.
A feasibility study helps our Client determine if they should sell their products and services in Singapore. The feasibility study covers i) business alternatives ii) new opportunities iii) reasons not to proceed iv) what could go wrong. Advantages of a feasibility study include:
Enhancing the probability of business venture success by identifying business risk early.
Provides quality information for decision making.
Provides documentation that the business venture was thoroughly investigated.
Helps secure funding from lending institutions and other sources.
If our Clients are satisfied with the outcome of the feasibility study, Healy Consultants will prepare a detailed business plan. A business plan provides a “roadmap” of how the business will be created and developed. The business plan provides the “blueprint” for project implementation.
After Singapore business setup, Healy Consultants can assist in designing, implementing and critically evaluating i) management and financial control systems ii) internal controls iii) policies and procedures iv) accounting, inventory, payroll, costing, budgetary control and management information systems.
Our lawyers advise on a wide range of commercial arrangements required by our clients’ Singapore company in their day to day operations, taking into account the nature of the business and the commercial and legal risks. Our services range from reviewing standard form agreements to drafting and assisting with the negotiation of complex bespoke commercial arrangements.
Regulatory advice, strategy and compliance, corporate licensing and government tendering.
We have extensive experience of providing advice on all types of commercial agency arrangements which ease the process of doing business in Singapore such as franchise, distribution, agency and commission arrangements and on the impact of local laws on such arrangements, including advising on the effect of these arrangements being registered with Singapore government authorities.
After setting up a company in Singapore, we have advised both our clients and their international partners on a large number of joint ventures in throughout the region which require a detailed knowledge of the local licensing and regulatory environment.
According to the 2012 Index of Economic Freedom by the US-based Heritage Foundation, Singapore is the second freest economy in the world, after Hong Kong.
Singapore's Port attracted 127,998 vessels and saw 29.9 million twenty-foot shipping containers in 2011, making it one of the largest shipping ports in the world.
The Mercer Human Resource Consulting's Quality of Living Survey 2011 has ranked Singapore as Asia's most livable city and the 25th most livable city in the world.
Singapore is perceived as the 5th least corrupt country in the world, according to the 2012 Corruption Perception Index by Transparency International.
According to the Singapore Statistics group, Singapore's real GDP (gross domestic product) grew 4.9% for 2011. Growth in 2010 was 14.8%, after recovering from the global economic downturn.
The Singapore government provides a range of incentives for investors, including tax holidays, loans, grants and equity financing. Visit the Enterprise One website for more details of Singapore government assistance.
In Singapore there is approximately one taxi for every 190 people.
The population density of singapore is 7,447 per square km (United Nations data, 2010).
Singlish is a local dialect spoken by Singaporean's. It is a mix of English, Hokkien Chinese and Malay.
FEES SCHEDULE
Year 1 incorporation
US$2,100 *
Annual fees from
Year 2
US$1,500 *
Resident director
fee
US$1,950 **
Company
de-registration
US$1,450
Singapore visa
(2-year)
US$2,950
* Includes government licence fees, registered office for 12 months, Company secretary fees for 12 months.
** Excludes US$1,100 refundable deposit.
FEES SCHEDULE