Accounting & Corporate Regulatory Authority (ACRA) is the agency you need to apply to for a company incorporation Singapore. It is the Company Registrar of Singapore.
The process for company incorporation Singapore is swift for both locals and foreigners. It takes only 1-3 working days. If you want to keep your initial investment down, search for a provider of Singapore company incorporation services that offers a package with free extra services.
Choosing a Singapore Business Structure for Tax Benefits
Anyone local, as well as foreigners over the age of 18, can start a business in Singapore. The country allows foreigners 100% ownership of their company. If you are a first-time business owner, it will be a good idea to know the types of business incorporation Singapore you can opt for.
Private Limited Company
Individual business owners prefer to register a private limited company. It allows them to claim various tax benefits, rebates, and exemptions awarded by the Singapore authorities. Following are the characteristics of a private limited company.
- 1-50 shareholders
- At least one director needs to be a Singaporean, Permanent Resident, or Employment Pass or EntrePass holder
- Separate legal identity from shareholders
- Has the rights of a natural person
- It continues to exist even after change or death of shareholders
- Buy or sell property in its name
- Can sue or be sued in its name
- Shareholders are not responsible for paying debts; liability rests with the company
- Transfer of shares is easy
A private limited company has a credible image in the eyes of investors, financial institutions, suppliers, & customers. It pays corporate income tax, which is in the range of 0%-17%.
Singapore Sole Proprietorship
Depending on the risk involved, you can also choose to register a sole proprietorship in Singapore. A proprietorship is not a separate legal entity from its owner. The proprietor’s liability is unlimited. It means that the proprietor is responsible for paying its losses or debts. Their personal assets can be used to do so.
- It cannot buy properties or real estate in its own name.
- Its income is taken to be its owner’s income.
- The proprietor has to pay personal income tax at higher rates of 0%-22%
- Raising funds for the business expansion depends on the proprietor’s credibility
Limited Liability Partnership (LLP)
You can also form an LLP that combines the best characteristics of a partnership and a company. It gives you a chance to work with individuals having complementing skill-sets. As many as 20 individuals can form an LLP. The liability of its members depends on their actions or inactions.
It has separate legal existence from its members
Groups of charted accountants, lawyers, and architects, prefer to register an LLP
Each member pays personal income tax (0%-22%) on the income received from their LLP
A subsidiary company is registered by foreign corporations to do business in Singapore. It has a separate identity from its parent company which is allowed to own 100% of its shares.
- It is treated as a local company and can claim tax benefits, exemptions, and rebates
- It is liable for its own debts and losses
- Parent’s liability is limited to the share capital it has invested
Singapore Branch Office
Foreign companies, depending on their business needs, can also register a Singapore branch office. It has no separate identity from its parent company and is not treated as a local company.
- A branch office is considered as the extension of its parent company.
- Its management follows the company constitution or M&AA of its parent
- The liability of its debts and losses lies with the parent
Pre-Incorporation Requirements of Company in Singapore
Before applying to ACRA for their company incorporation Singapore, local as well as foreign entrepreneurs must provide the details listed below:
- $1 in minimum paid-up capital
- At least 1 shareholder
- At least 1 resident director
- At least 1 company secretary
- Registered physical local address
Local business owners can initiate and complete the process for company incorporation Singapore on their own. However, as a foreigner, you cannot self-register a Singapore company.
You have to appoint a registered filing agent or a provider of Singapore company incorporation services to do so. Many accounting firms, law firms, or secretarial services in Singapore provide these services. If you intend to relocate and take charge of your company, you will also need to acquire an Employment Pass or Entrepreneur Pass.
Discuss your needs with your agent, and they will walk you through the process for company incorporation Singapore, official ACRA fees and the documents you need to submit.