Singapore Company Incorporation: How it Works?
In the days of globalization, investors and the entrepreneurs need to be aware of the opportunities in their native as well as distant places. For the last two decades, Singapore has played the role of the most favored business destination in South East Asia. The Q3 2015 has seen 10% rise in the number of Singapore business incorporation.
Singapore Offers an Effective Business Environment
Indeed, Singapore is a great place to spread your business roots. The country ranks at the top of the Ease of Doing Business indicator. In Q3 2015, more than 17,000 businesses were registered and more than 30% of these were owned by foreign entities. Small and Medium Enterprises (SMEs) and the MNCs get attracted to Singapore for its business-friendly environment. Its low tax rates, political stability, corruption-free bureaucracy, infrastructural readiness conducive to the business activities and its closeness to emerging markets of Asia.
Singapore also attracts self-employed consultants that offer their services to their clients from all over the globe. These professionals benefit from establishing an offshore company in Singapore. The ease in the incorporation of a company in Singapore, straightforward compliance requirements, dependable transportation infrastructure, swift legal system, and most importantly, access to the reliable financial institutions and other factors highlight the Singapore’s availability as a great business destination.
Singapore Company Incorporation
It is easy to a setup company in Singapore. Normally, it takes only 1 – 3 days. However, it may also take 2 months for incorporation of businesses in the banking, educational, etc., domains. Such applications are usually approved by the concerned ministries.
The entrepreneurs need to complete only two procedures to open a company in Singapore; company name approval and filling and submitting an application to register the company.
The Singaporeans and the permanent residents can initiate the process on their own. However, the foreign individuals and corporate need to seek help from the Singapore incorporation services. The company incorporation process is online and needs SingPass ID, which the foreigners do not have.
Singapore Incorporation Services: A Bridge Between ACRA and Entrepreneurs
The incorporation services use their Professional Number to initiate the registration process on behalf of their clients with ACRA. In fact, they assign a company incorporation expert to their clients task of Singapore business incorporation. ACRA (Accounting and Corporate Regulatory Agency) is a government agency that also acts as the Company Registrar of Singapore.
The professionals working for these services also advise their clients on the types of businesses they can incorporate in Singapore. They also help in identifying the ones that are most useful for their clients’ business activities.
Types of Companies
All in all, the Private Limited Company is the most trusted business structure in Singapore, as the majority of registered companies are of this type. However, the entrepreneurs also have the option of registering business firms like Sole Proprietorship or Limited Liability Partnership (LLP).
A private limited company, as its name suggests, limits the liability of its shareholders that may arise out of losses due to the business activities, whereas, it is unlimited for the sole proprietors and partners in LLPs.
Registering a Singapore registered private limited company give the entrepreneurs a huge advantage. It can claim all the tax benefits, exemptions, and incentives offered by the Singapore taxation system. It is required to pay corporate income tax on its taxable income.
The corporate income tax ranges from 0% – 17 %, which is much lesser than the personal income tax. The effective tax paid by the Singapore local companies comes to about 8% – 9%. On the other hand, Sole Proprietors and the partners in the LLPs need to pay personal income tax which ranges from 0% – 20%.
Appointing Singapore incorporation services is an important step towards hassle-free Singapore company incorporation. The professionals working in these firms are well-versed in handling situations like the rejection of the name of the proposed company due to infringement of trademarks, use of certain terms, etc., and are swift in taking containing actions. They assist their clients in appealing against the a rejection of an application to register a Singapore business.
After the successful incorporation of a company, they also help their clients in the opening of the corporate bank account, in acquiring Company Seals and stamps, licenses and permits, if business’ activities need them.