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Singapore Company Registration

Ms. Zhang
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Service Description

I. Advantages of incorporating a company in Singapore
With over 500 financial institutions worldwide, Singapore is the world’s fourth largest foreign exchange trading center and a leader not only in international finance, trade finance, marine finance, insurance, and financial operations, but also in asset and wealth management. Singapore is voted as one of the easiest places in the world to do business, and it is relatively easy to start a business in Singapore compared to other neighboring countries. Companies can be set up in a matter of days and registration is relatively quick. Singapore has a stable system of government, a transparent legal framework and a strong legal system, and is ranked first in Asia in the International Transparency Index against Corruption. Singapore currently has the largest network of free trade agreements in Asia, making it easy for companies to enter the international market effectively and easily. The advantages of incorporating a company in Singapore include the following:    

If the company has only one shareholder and director, then the incorporation of a Singapore limited liability company can be completed within one week. The actual capital can be as low as S$1 (i.e. the nominal value of each share issued is SGD). In addition, Manetic Group can act as the sole agent for the incorporation of the company without the need for the client to travel in person.

Singapore is definitely attractive to Chinese companies looking to locate overseas because: Singapore companies are only required to file corporate income tax returns once a year and the tax rate is only 17% based on profits; and government departments such as the Singapore Economic Development Board, the International Enterprise Development Board, the Tourism Board, and the Inland Revenue Department offer a number of tax incentives and deductions.

◆ Singapore has no controls on foreign exchange and repatriation of company capital and profits from there, so the depth and liquidity of the capital market helps companies raise capital more easily.

◆ Singapore companies can raise capital in the international capital market by listing on the Singapore Stock Exchange, such as China National Aviation Oil and China Oceanwide Investment.

◆ Through the actual operation and taxation of the Singapore company in the country, the shareholders of the company can get the opportunity to immigrate to Singapore for the whole family, realizing the dual benefits of business and immigration.

Companies based in Singapore can take advantage of the integrated infrastructure of sea, land and air to connect the world and deliver goods and services to anywhere in the world.

For holding companies or regional headquarters of multinational companies, Singapore is definitely an ideal choice. With proper arrangements, profits earned by a Singapore company outside of Singapore are not subject to income tax in the country. If the company is required to pay at least 15% tax on dividends (including amounts reasonably avoidable, e.g. in tax holidays), the Singapore government will not collect corporate tax from the foreign company.

◆ Singapore has signed double taxation exemption agreements with 75 countries and territories to reasonably protect the interests of multinational companies and international subsidiaries.

◆The business transformation of enterprises, domestic trade to foreign trade, and more tax relief.

◆If you register a company in Singapore, you may get the opportunity to immigrate to Singapore, and if you have actual business and pay taxes locally, you may also get the opportunity to move more family members to Singapore.
II. Information and Requirements for Company Formation in Singapore
The following information is required:

Company name: The name of the new company must be approved.

Directors: At least one local director (Singapore citizen, permanent resident, employment pass or family pass holder) must be appointed. You may appoint as many local and foreign directors as you wish, provided that they are at least 18 years of age, have no bankruptcy or criminal record, and are not required to be shareholders.

Shareholders: A private limited company can have between 1 and 50 shareholders, who can be local or foreign individuals or entities. After incorporation, you may issue or transfer shares to shareholders. A private company is considered a private exempted company (EPC) if it has no more than 20 shareholders and no other business holds any beneficial interest, directly or indirectly, in the shares of the company. If it meets the Conditions for Smaller Companies The EPC is exempt from audit. At least one shareholder is required and may be 100% owned by a foreign national.

● Company Secretary: Under Section 171 of the Singapore Companies Act, you must employ a qualified company secretary within 6 months of the incorporation of your company. The secretary must be a natural person residing in Singapore and cannot be the sole director or shareholder of the company.

● Paid-up capital: at least S$1, but you may increase the amount at any time after incorporation. Singapore companies do not use authorized capital but issue ordinary shares, preference shares or other shares.

Registered Address: You must register a local business address, which can be a residential or store address, but not a post office address. Under the Home Office Scheme, owners of HDB flats and private properties in Singapore can use their homes to run small businesses. You can register your business with the Accounting and Corporate Regulatory Authority of Singapore (ACRA) (HDB) or the Urban Redevelopment Authority (URA) before or after registering your company with ACRA.

Taxes: You will love the tax exemptions and incentives in Singapore: for example, no more than 5% tax on the first S$300,000 of annual profits and 17% tax on the following years; no need to pay attention to dividend tax or capital gains tax; Singapore companies enjoy some of the best tax benefits and business reputation in the world.
III. Types of Company Formation in Singapore
The three most common business entities in Singapore are sole proprietorships, limited liability partnerships and private limited companies, as follows:

Company Model Sole proprietorship Limited Liability Partnership Private Limited Company
Suitable for the type Low Risk Individuals Accounting, legal and construction firms. Companies that plan to expand their business and may need additional capital to expand their operations.
Advantages Low Cost Low cost, protected by limited liability. The first S$100,000 of annual net profit is taxed at 4.25% for the first 3 years of incorporation and 8.5% for the next S$200,000. More government subsidies are available.
Disadvantages Personal assets are not protected The tax rate is higher than the corporate income tax rate for individuals who are subject to personal taxation. Compliance with regulations, such as the publication of financial reports and the holding of annual general meetings, is required.
Ownership – Singapore Residents
 – Foreigners and companies must appoint local managers		 – Singapore Residents
 – Foreigners and companies must appoint local managers		 – 100% foreign or local ownership, no foreign share licensing
 – At least one Singapore resident must be appointed as a director (we can provide proxy services)
Separate legal entity None There are There are
Maximum number of members One person No limitation Exempt companies up to 20 people
Minimum Establishment Requirements One owner Two partners One shareholder and one director (one person can have two roles)
Limited Liability None Yes, partners are not personally liable for any business debts of the business, nor are they personally liable for the misconduct or negligence of other partners, but may be personally liable for losses caused by their own misconduct or negligence. There are
Account Audit None None If a company meets the the conditions of a small company The audit may be exempted.
Tax Treatment Taxed at personal income tax rate (up to 22%) Taxed at personal income tax rate (up to 22%) Taxed at the corporate income tax rate (up to 17%)
Closure of business on death of a member/partner Yes No, any changes to the partner will not affect its existence, rights or obligations. If not, the shareholding may be inherited by another person.
Annual total cost of ownership Need Bookkeeping and Tax services. Bookkeeping and tax services are required. In addition to bookkeeping and tax services, secretarial services are also required and an unaudited financial statement is prepared for an additional charge of $535 per service. However, you may be entitled to higher tax exemptions and more government grants. For example, in the 2012 Annual Assessment (YA), companies can receive a one-time, non-taxable S$5,000 SME grant. This grant helps companies to offset high costs, avoid a continued slowdown in business growth, and is sufficient to cover annual compliance costs.

 
IV. Singapore Company Formation Procedures
Before establishment

①. Consultation stage: We discuss with the client the goals and requirements of the new company and help the new company to develop the best corporate structure. At the same time, during this stage, Manetic Group will also outline the requirements for registration of relevant licenses and customize the content and format of the project charter.

②. Company Name Registration: Three alternative company names are listed according to the customer’s preference, which must be clearly distinguishable from other registered company names. Since it is a statutory requirement in Singapore that only residents are allowed to register their company names, Manetic Group will submit the company name registration file on your behalf.

③. Provide the required information for incorporation: company shareholders, directors and secretary are established, the company appoints up to 50 shareholders, at least one of the appointed directors is a resident of Singapore, and the secretary can be an individual or a company, but must be settled in Singapore. Manetic Group can provide you with secretarial services which are already included in our full suite of services for incorporating a Singapore company.

④. Articles of Incorporation: The Articles of Incorporation are important documents signed by the shareholders and used to manage the business of the company. The Singapore Companies Act provides a standard template that is suitable for most clients’ needs, on the basis of which the legal department of Manetic Group will make customized amendments to the articles of association according to the specific requirements of the client. The articles of association must mention the company’s share capital, registered address, directors and limited liability.

⑤. Planning Stage: In this stage, the Group will conduct a detailed project plan based on all available information, including incorporation, tax registration, opening a corporate bank account and obtaining relevant permits. The participation plan is a critical part of the service provided by the Group. Through this document, the Group will significantly increase the transparency of its services, gain insight into and set client expectations, and minimize project failure rates.

● Set up the program

①. Signing a contract for the registration of a Singapore company

②. Provide company name for verification

③. Provide the necessary information for registration

④. Make a file according to the information

⑤. Confirm the file for signature and return the file

⑥. Collection of original documents

● Post-Registration File Collection

1、Registration paper Bizfile

2、Establishment announcement

3. Resolution of the first board meeting

4, titular director authorization file (if there is endorsement)

5、Commercial secretary authorization file

6、Business license

7、Registered address announcement

8、Shares certificate file

9、Articles of Incorporation

10、Company rubber stamp

11、Steel Seal

Do I have to be a Singaporean to register a Singaporean company?

The requirement for directors of Singapore companies is 18 years old or above, and there is no restriction on nationality or number of directors. Therefore, a Chinese person can also register a Singapore company. If the director and the shareholder are the same person, the person must be a Singapore citizen or permanent resident or an employment pass holder.

The minimum capital required for incorporation of a Singapore company is only S$1. It is possible to increase the registered capital after the company has been incorporated.

After the incorporation of a Singapore company, there is a need for follow-up maintenance, such as annual audit and tax filing. Accounting can be done by the company itself or can be entrusted to a Singapore accounting firm. However, auditing must be done by a certified public accountant.

You can only apply for a bank account after the company has been incorporated. Opening an account usually requires the director to visit the bank. A company can open multiple bank accounts.

Singapore companies are subject to a relatively small number of taxes, and the only tax a company must pay each year is income tax. This is calculated as 17% of the actual profit. Singapore companies are accustomed to file their tax returns in March every year as the previous year's closing date.

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