Get T.I.M.E. Advantages Of Incorporating a Limited Liability Company in Singapore
An ace entrepreneur or an ace organization is always looking out for strategic business locations, offering substantial opportunities to expand their businesses. They usually prefer a location from where it is easier to achieve newer frontiers and new horizons, by taking advantage of the local business environment. A foreign national or a foreign organization exploring the possibility of expanding its business out of its national boundaries will definitely find Singapore as the dream destination for incorporating its business and operating from the foreign soil.
Embodying a harmonious blend of east and west, Singapore is a destination rich in contrasting experience. This city has grounded its unique heritage but enthusiastically embraced every technological challenge. Having frequently won many accolades and awards for being the most conventional city, Singapore is also known to be an easy destination for doing business. Not for the sake of mere benefits, one can claim by Singapore company formation, but also for tapping the uninvaded market potential in Asia, it has become the latest trend amongst modern businesses and multinational companies to set up Singapore Company.
When it comes to enumerating the advantages of Incorporate company in Singapore, this surely is a country with excellent merits. Here we intend to discuss the benefits an organization can claim after Singapore company registration.
Set up Business in Singapore to Avail “T I M E” Advantages
Whether it is corporate or individual, Singapore has a flexible and lowest tax regime as compared to other nations. Singapore has a progressive personal income tax starting at 0% for earnings less than S$20,000 to be capped at 22% for earning above 320,000. The Singapore government has implemented a single tier corporate tax system. Almost 0% tax is payable by the companies earning profits up to S$ 100,000 for the first three years of their business. After three years, profits earned up to S$300,000 are taxable at 8.5%. The corporate income tax is capped at 17% on profits earned in the range of S$300,001 to S$2,000,000. The best thing about Singapore’s taxation regime is it has no Capital Gains Tax, no tax on income earned on foreign soil and no Tax on Dividends offered to shareholders.
Due to the liberal immigration policies and because of the ample opportunities of growth and development in a professional career, Singapore is favored a lot by many foreigners. Employment Pass is a provision made for working class Singaporeans making them eligible to apply for the Dependent Pass for their families. An EntrePass is a provision made to motivate foreigners for incorporating businesses in Singapore. An EntrePass or a Dependent Pass holder is liable to apply for citizenship, if he/she fulfills all the required credentials. Recently, the Singapore government curbed immigration. However, considering the long-term competitiveness of the Singaporean economy, it is expected that the Singapore government will ease its rules relating to foreigner inflows.
This is one of the important aspects, facilitating Singapore Company Registration in an easy and speedy manner. In a recent survey of 12 Asian countries, Singapore emerged, Singapore civil services emerged as the economy with least encumbered by the red tape and concentration of power. Singapore government played a fine role in managing and developing its society and economy, as it was the countries single largest employer for many years. A country having an efficient bureaucracy has efficient legislature and an effective executive branch leading to red tape free bureaucracy and Singapore is a positive example. Bureaucracy and lower corruption rates in Singapore are the two major attributes contributing the top ranking of Singapore in World Banks Doping Business Report. When one can open company in Singapore in mere one day, then it surely becomes hard for the entrepreneurs to overlook the option of having their base in Singapore.
Environment For Entrepreneurship Development:
Singapore is considered as one of the most reliable countries in the world, especially where matters related to the economy, finance and company incorporation are concerned. Not only the government in Singapore is stable, but also the progressive policies implemented by the government to induce growth are also stable. In no way, Singapore bureaucracy or corporations in Singapore, differentiate the companies as local and foreigner incorporated. Neither banks nor the government ill-treats any foreign company or foreigner incorporated company. In fact, a foreign entity in Singapore has additional chances of raising capital due to its existing reputation. Therefore, the economy as well as the corporate environment in Singapore is definitely pro for developing entrepreneurship and conducive to the development of businesses.
Prefer Limited Liability Company If You Want to Incorporate Company in Singapore
The economic environment in Singapore seems more favorable to a limited liability company if you are planning to set up a business entity to stay afloat for many years to come. Business entities like the sprivate limited company, exempt private limited company and subsidiary companies have legal existence in the Singapore business world. Whereas, three types of partnership firms and sole proprietorship company does not have any distinctive legal status. Therefore, it is always better to incorporate a limited liability company and alike when someone is planning to start a business in Singapore.
To further strengthen your belief on Limited Liability Companies, here are a few interesting facts about them
- Legal Status: A Limited Liability Company has its own separate legal identity from that of its shareholders and owners. An LLC can own property, ask for loans, get into contracts, and declare bankruptcy, otherwise to sue or be sued in the name of the company.
- Protection: Being a limited liability company the liability of the shareholders and the members of the company is limited to the amount they have contributed in paid-up capital. In any case, the assets of the shareholders are free from any liabilities and debts incurred by the business entity.
- Ease of Transferability: With the limited liability company, you get an access to the transferring ownership of the company without much, legal hassles. You can transfer the ownership either wholly or partially by either selling all or part of existing shares. Issuing new shares is to a new set of investors is also one of the easiest ways of transferring or sharing ownership.
- Tax benefits:Opting for Singapore company formation under the umbrella of LLC many incorporated companies enjoy lower tax rates compared to the businesses formed as a sole Proprietorship or Partnership companies. LLCs can enjoy a tax rate of 0% to 17 % on which the corporate tax rate is capped for profits earned above SGD 3,000,000. In addition to that, Singapore is not having any capital gains tax and the single tier taxation scheme in Singapore allows Singapore companies to distribute tax-free dividends.
- Continuance of existence:The proprietary or the Partnership companies cease to exist the moment the owner dies, but in incorporation even if the shareholders die or leave the business or the ownership of the business is transferred, the incorporated LLC continues to exist; hence, it has an unlimited life span.
- Raising capital for expanding the business or diversifying:Proprietary and Partnership firms find it difficult to raise funds for expanding their businesses, whereas this is not the problem with the LLCs as they can easily raise funds by selling shares. Although, it may reduce the percentage of ownership in the company.
- Potential for increase in business:The incorporated entities are perceived to be more stable and reliable; therefore, the companies find it safer to do business with the incorporated companies rather than the other forms. This understandably raises the chances of getting more and continued business.
The advantage of Singapore Company Incorporation is that it gives you an opportunity to realize the actual potential of your business and accordingly align your business plans. Yes, there is an inherent risk of failure and losing all of your investment. The risk can be negated by finding the right niche to deliver your services or the products, collecting business contacts, and by providing support to your clients.