Singapore Company Incorporation Guide

Singapore Company
Incorporation Guide

---

OVERVIEW
A foreign company or entrepreneur may fi nd challenges in naviga ng
Singapore is the #1 place to do business
in the world.
the incorpora on process in Singapore. This guide is designed to
AsiaBiz provides professional services
to assist you through the process.
illustrate op ons for a company or anyone interested in se ng up a
business in Singapore.
Singapore is consistently ranked as Number 1 place to do business in
the world. With the economic boom of Asia, Singapore has become
the ideal springboard to many of the markets in the Asia Pacifi c region.
AsiaBiz provides professional incorpora on, accoun ng, tax,
immigra on and all other corporate related services in Singapore.
We are here to assist you through the incorpora on process and to
help you succeed in your business venture. Our goal is to make the
process as seamless as possible, and aff ordable too.
The following business guide is for your general informa on only.
We look forward to being of service to you in your new venture or
ongoing business in Singapore.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

CHOOSING A BUSINESS NAME
Choosing a business name is the fi rst important step in the se ng
Your business name must be approved
up of a business. Most businesses choose names that iden fy the
by ACRA. This process usually takes less
than an hour.
products or services they off er. An important thing to note when
choosing an appropriate name for your business is that ACRA must
fi rst approve the name you have chosen. The approval process usually
takes less than an hour, and the approved name can be reserved for
60 days from the date of applica on.
To ensure a quick and hassle-free name approval, make sure your
company name meets the following condi ons:
* Not
iden cal or too similar to any exis ng local company names
* Does not infringe on any trademarks
* Not obscene or vulgar
* Not already reserved
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

CHOOSE A TYPE OF BUSINESS STRUCTURE
Choosing the right business structure is essen al in your development
and the eventual success of your company. AsiaBiz is the business
incorpora on expert and aims to help business owners choose the
best op on for their business. This serves as a general informa on
guide. For more informa on, please speak to our incorpora on
experts or your a orney.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

TYPES OF BUSINESS STRUCTURE
Sole Proprietorship
Company
* A sole proprietorship is the simplest but the
* There are four types of companies in Singapore:
riskiest type of business form in Singapore.
Private Limited Company - Not more than 50
* The sole proprietor must be a Singaporean/PR/
corporate or individual shareholders.
EP Holder/DP Holder. If the owner is a foreigner
Exempt Private Company - Not more than 20
residing overseas, he can appoint a local manager.
individual shareholders.
General Partnership
Public Company Limited by Shares - It is locally
* A partnership is a form of business owned
incorporated where the number of shareholders
by a minimum of two partners and a maximum
can be more than 50.
of 20.
Public Company Limited by Guarantee - It is one
* A partnership is not a legal en ty separate from
that carries out non-profi t making ac vi es that
its owners/partners. Each partner is jointly and
have some basis of na onal or public interest,
severally liable for all debts of the partnership.
such as for promo ng art, charity etc.
* Like sole-proprietorship, a local manager must be
* A company is a legal en ty, separate and dis nct
appointed if none of the partners are Singapore
from its owners/shareholders. It can incur
residents.
obliga ons and hold property in its own name.
Consequently, it can sue and be sued in its own
Limited Liability Partnership
name, it has perpetual existence and it can
* The LLP is a limited liability company and has the
contract with its controlling members.
opera onal fl exibility of a partnership.
* It requires a minimum of two partners but there
is no cap on the maximum number of partners
allowed for an LLP. Partners can be individuals or
companies.
* Unlike partnership, an LLP is a legal en ty,
separate and dis nct from its owners/partners.
* It is compulsory for all LLPs to appoint at least
one local manager.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

BUSINESS TYPE COMPARISON
OMP
CHART
Limited
Private
Sole
General
Liability
Limited
Proprietorship
Partnership
Partnership
Company
ACRA fi ling
(& fi ling fee)
required for
crea on
Full liability
Limited liability
protec on
Perpetual
dura on of the
business
100% foreign
ownership
Strict
compliance
requirements
Flexibility in
who manages
the business
Profi ts taxed
at personal
income level
Business taxed
at en ty level
Tax incen ves
and exemp ons
Ease of raising
Maybe
capital
Ease of adding
owners/
transferring
Maybe
ownership
interest
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

OPTIONS FOR FOREIGN INDIVIDUALS
If you are a foreign individual interested in establishing your
corporate presence in Singapore, you can choose one of the
following op ons. As a foreign entrepreneur you can freely
incorporate a private limited company in Singapore. 100% foreign
ownership is allowed.
Company Incorpora on with reloca on
With Employment Pass: This is our most popular op on whereby
For incorpora on with reloca on:
a foreign entrepreneur, professional, execu ve, director or
- Employment Pass
- Entreprenuer Pass
employee plans to relocate to Singapore to work in or run a
For incorpora on without reloca on:
- Nominee Director
business opera on from Singapore. You will need to accomplish
the following, incorporate the Singapore Company and obtain
work pass visa, commonly known as Singapore Employment Pass.
With EntrePass: The EntrePass is designed to facilitate the entry
and stay of entrepreneurs who are ready to start a new business and
be ac vely involved in the opera ons of the company in Singapore.
EntrePass is primarily meant for entrepreneurs that do not have a
degree or specialised skills in the relevant fi eld, but have a proven
track record of successful business ventures or unique business
ideas with poten al economic development.
Company Incorpora on without Reloca on
If reloca on is not a possible op on, AsiaBiz provides a Nominee
Director Service for your company. Our service will help you meet
the statutory requirement of the appointment of at least one
individual director who has to be a local resident in Singapore.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

OPTIONS FOR FOREIGN COMPANIES
Subsidiary Company
Features of Singapore Branch Offi
ce
A subsidiary company is a private limited company
* The name must match that of the parent company.
incorporated in Singapore with the parent company as its
* It is required to submit its own audited fi nancials accounts,
shareholder.
as well as those of its head offi
ce.
* From a taxa on point of view, a branch offi
ce is generally
Features of a Subsidiary
considered a non-resident en ty and although it is en tled
to enjoy the par al tax exemp ons, it is not eligible for
* A Singapore subsidiary can be wholly owned by the foreign
the various tax incen ves and rebates available to local
company and is considered a separate legal en ty from the
companies in Singapore.
foreign company.
* It does not have separate legal iden ty, and therefore the
* For taxa on purposes, the subsidiary may be treated as
foreign parent company is responsible for all its debts,
a Singapore resident company and as such eligible for tax
losses and liabili es.
exemp ons and incen ves available to local companies.
* A subsidiary company, with at least one individual
Setup Requirements for Branch Offi
ce
shareholder with minimum of 10 percent shareholding, is
en tled to new start up tax incen ves - Zero tax on the
* 2 Resident Agents
fi rst S$100,000 of chargeable income for the fi rst three
* A Singapore registered offi
ce address
consecu ve years. A further 50% exemp on is given on the
next S$200,000 of the chargeable income.
Foreign companies that plan to relocate any of the staff
members (agent) from head offi
ce to Singapore can apply
Setup Requirements for Singapore Subsidiary
for their employment pass a er the Branch offi
ce company
registra on. Alterna vely, you can engage our Nominee
* Minimum 1 Shareholder + 1 Resident Director + 1
Agent Service to represent your Branch Offi
ce.
Company Secretary
* Minimum ini al paid-up capital is S$1
Representa ve Offi
ce
* A Singapore registered offi
ce address
A Representa ve Offi
ce provides a foreign company interested
The Companies Act requires the appointment of at least one
in establishing opera ons in Singapore an avenue to assess
director who must be a Singaporean/PR/EP Holder/DP Holder.
business opportuni es in Singapore market prior to making
Alterna vely, you can engage our Nominee Agent Service to
any long term or large scale commitment. A Representa ve
comply the local director statutory requirements.
Offi
ce cannot engage in commercial revenue-genera ng
ac vi es.
Foreign companies that plan to relocate any of the staff
members from head offi
ce to Singapore can apply for their
Setup Requirements for Representa ve Offi
ce
employment passes a er the subsidiary company registra on.
*
1 Chief Representa ve Offi
cer
Branch Offi
ce
*
A Singapore registered offi
ce address
A Branch Offi
ce in Singapore func ons as an extension of a
You can apply for an Employment Pass for the chief
foreign company that is registered outside of Singapore.
representa ve offi
cer only a er you have succeeded in
registering the Representa ve Offi
ce.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

COMPARISON TABLE FOREIGN COMPANIES
Subsidiary Company
Representa ve Offi
ce
Branch Offi
ce
En ty Name
Need not be the same as parent
Must be the same as parent
Must be the same as the parent
company
company
company
Ac vi es Allowed
Can conduct all business ac vi es
Can only conduct market
Must be the same as the parent
research or coordina ng ac vi es
company
Suitable For
For local or Foreign Companies
For Foreign Companies who wish
For Foreign Companies who wish
who wish to expand their
to set up temporary vehicle in
to expand their opera ons in
opera ons in Singapore
Singapore to conduct research
Singapore
and act as liaison offi
ce
Disadvantages
Con nuing Compliance
It is a temporary vehicle and
Con nuing Compliance
Obliga ons eg Financial Reports,
cannot generate revenue
Obliga ons eg Financial Reports,
Audit, AGMS, etc
Audit etc
Ownership
Can be 100% foreign or locally
No Ownership
Owned 100% by the head offi
ce
owned
Separate Legal En ty
Yes
No
No
Cap on Number of Members
Yes, max 50
Not Applicable
Not Applicable
Minimum Se ng up
Min One shareholder, which
Must appoint a Chief
Must have two Singapore
Requirement
can be an Individual or
Representa ve who will relocate
Resident Agents
corporate, (100% local or foreign
from headquarters
shareholding allowed. Must have
at least one resident director
Limited Liability
Yes
No
No
Need for Audited Accounts
Yes
No
Yes
Filing of Accounts with ACRA and
Yes
No
Yes
IRAS
Annual Filing
Must fi le audit report subsidiary
Not Applicable
Must fi le branch offi
ce's as well as
parent company's audit reports
Tax Treatment
Taxed as Singapore resident
Not Applicable
Taxed as non-resident en ty, local
en ty, local tax benefi ts available
tax benefi ts not available
Tax Benefi ts
A subsidiary company, with at
No Corporate tax. Employees
Par al tax exemp on
least one individual shareholder
have to pay personal tax
with minimum of 10 percent
shareholding, is en tled to local
tax incen ves and rebates
Cessa on of Business upon
No. Equity shares go on in
Not Applicable
No
Death of a Member/Partner
perpetuity
Validity Period
Perpetually un l deregistered
This is a temporary Setup. It is
Perpetually un l deregistered
intended not to last more than
3 years
Normal Registra on Time
3 hours
3-5 days
3 hours
Appointment of Offi
cers
Must appoint at least one local
Must appoint a Chief
Must appoint two resident agents
resident director
Representa ve who will relocate
from headquarters
Governing Body
ACRA & IRAS
Interna onal Enterprise Singapore
ACRA & IRAS
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---

HOW TO INCORPORATE A COMPANY IN SINGAPORE
Most companies that are incorporated in Singapore are private limited liability
companies. To form a private limited liability company, incorpora on paperwork
must be fi led with Singapore Accoun ng and Corporate Regulatory Authority,
commonly known as ACRA. This sec on outlines the procedure and meline required
to successfully complete a company registra on with ACRA.
Copyright (c) 2011 AsiaBiz Services Pte Ltd

---