A Foreigner’s Guide: How to Start a Business in Singapore
Singapore, a name that signifies economic powerhouse in Asia, has been one of the favourite investment hotspots for foreigners. While many might think that starting a new business in Singapore is a daunting task, it could be an easy task if you are guided with professional advice and assistance. Read on to find out how this article will help you to navigate the incorporation procedures in Singapore.
What to Consider Before Incorporating a Singaporean Company
First thing first, you must have the right working pass, such as Employment Pass (“EP”) or EntrePass, if you plan to start doing business in Singapore.
However, an EP or EntrePass is not needed if you intend to run your business without relocating to Singapore. You can appoint a local nominee director to fulfil the requirement of Company registration in Singapore.
2. Are you age 18 years and above?
In Singapore, any person age 18 years and above is eligible to register a company in Singapore. Apart from the age limit, he or she cannot be a criminal (convicted any legal offense) or a bankruptcy.
3. Do you need/have professional assistance and help?
As mentioned, setting up a new company in Singapore can be a daunting task without the advice and help from the professionals. For one, getting help from a Singaporean company incorporation service provider will save you time and energy when dealing with incorporation process. For another, professional help and advice will help you to navigate the ins and outs of doing business in Singapore in a breeze.
How to Incorporate a Company in Singapore?
- You can setup a sole-proprietorship in Singapore with the condition that you need to an authorised representative (who is originally a resident of Singapore, i.e. Singapore citizens, Permanent Residents and EntrePass holders) whilst you reside outside of Singapore. In the case that you wish to reside in Singapore and run your business, an EntrePass is needed as one of the requirements to setup your sole-proprietorship.
- Other than sole-proprietorships, you can register your business as a partnership in Singapore with the condition that one of your partners must be ordinarily residing in Singapore. Similar to sole-proprietorships, you need to an authorised representative (who is originally a resident of Singapore, i.e. Singapore citizens, Permanent Residents and EntrePass holders) whilst you reside outside of Singapore. In the case that you intend to stay in Singapore and run your business, an EntrePass is needed as one of the requirements to register your business.
- A subsidiary company is the common type of business structure for foreign entity. In Singapore, a subsidiary company is a type of limited liability company that its foreign parent company can have 100% shareholder. A subsidiary company is a separate entity from its foreign parent company.
d) Branch Office
- A branch office is a proper legal entity after registration where a branch is usually an extension of its parent company. A branch office has to employ a minimum of one ordinarily resident in Singapore. However, a branch office is not a separate entity from its parent company (unlike a subsidiary company) where the parent company is liable for all its debts and liabilities.
e) Representative Office
- As the name implies, a representative office is setup only for the purpose of market research and feasibility studies, and no profit-making business activities are allowed.
Furthermore, a representative office does not have a separate legal identity from its foreign parent company and it has to employ not more than five employees.
The second step is to decide a business name for your company. In Singapore, be sure you do a name check (to determine the availability of your proposed business name) before you register your desired company name with Accounting and Corporate Regulatory Authority (“ACRA”).
A. Before the incorporation, make sure:
- a) Your business name is the ACRA-approved company name
- b) You have at least one shareholder
- c) At least one of your company directors is residing in Singapore.
- In Singapore, having at least one local director (he or she can be either a Singapore citizen, or a Permanent Resident, or a person holding an EntrePass, Employment Pass, or Dependent Pass) is a mandatory requirement.
- d) You have appointed one Company Secretary who is a Singapore’s resident.
- e) You have at least S$1 of paid-up capital.
- f)Your business has a local address as the registered company address.
B. What are the documents required by ACRA (for company registration)
- a) Company Name
- b) Short description of business activities
- c) Details of shareholder(s)
- d) Details of director(s)
- e) Details of company secretary
- f) Registered Address
- g) Company Constitution
C. Company registration process
The company registration’s process in Singapore is fully computerized by ACRA. A company can be incorporated in a two-day window. After the company incorporation process, the new company can purchase a Business Profile from ACRA where you will need this profile for bank account opening and business licences application. The business profile contains the following:
- registration number (UEN),
- date of registration,
- shareholders etc.
The next step is to open a bank account in Singapore. On top of its competitiveness in economic performance, Singapore is famous for its well-established financial sector. From OCBC Bank, DBS Bank to foreign banks like SCB Bank, you have a wealth of choices to decide – the one that suits your business strategy.
Long story short, it is a known fact that Singapore is not only an economic powerhouse in Asia as well as in the world; it is also one of safest countries to do business. Do not hesitate to reach out to our professional team if you have any enquiries about company incorporation in Singapore!