No matter if you’re an entrepreneur of a small startup company or a corporate officer at a multi-million dollar business, choosing where you want to place your business stationed is a huge deal. Let’s take a closer look at this issue and break it down in simple terms so that everyone can understand the clear benefits & potential implications associated with the decision. After reading this article, you’ve be much more educated on this issue and will be able to understand why this issue is a vital building-block for any corporation.
Sit back, grab yourself a cup of coffee, and enjoy the read.
Why Does It Matter Where You Incorporate Your Business?
It doesn’t matter where you decide to incorporate your business, each country has its own set of variables that come into play. In order to better understand this issue, lets break this down a little further to better understand what variables come into play when deciding where to incorporate your business.
Taxes & Tax Treaties
Usually one of the deciding factors, taxes play a huge role in a company. Each country itself has different tax laws and treaties that run independent of any other country. Taxes and tax treaties have the potential to severely impact your personal returns as well as your investors. Be sure to explore income tax and capital gain possibilities.
Looking forward, you should consider the countries jurisdiction & how their tax laws work. This can usually be done by contacting a tax specialists or an accountant.
Another popular deciding factor on where people decide to incorporate their business is investing laws & implications. Be sure to do your research on tax relief & detailed laws and regulations.
Before you can incorporate a business in any country in the world, you may need to consider residency requirements for the businesses founders. Some countries require that founders reside in the same country that the company was incorporated in.
Where Do You Recommend Incorporating Your Business?
Unfortunately, there is no “perfect answer”. Each business and person values different things and thus it’s impossible to recommend the “best country” in regards to incorporating your business.
However, with that being said, the recommendation is….
Singapore. Yup, you are right. The recommendation is Singapore.
You may be asking yourself why in the world is the recommendation be Singapore?
Singapore provides the most benefits and support for anyone looking o incorporate their business or company.
Why You Should Choose Singapore to Incorporate Your Company
Unless you’ve been living under a rock for the past decade, you’ve probably seen Singapore’s progressive business movements on the news or heard of Singapore’s efforts to be recognized as a business leader.
Recently, Singapore has been recognized as a genuine world class leader for incorporating businesses. Beyond this, the country itself has ranked highly and been recognized for many business-related criteria. Some recent examples include:
- Being rated number one in the world by the World Bank for their ease of doing business
- Rated as the number one most politically stable country in Asia
- Considered as the number one labor force country in the world
- Ranking number one country for quality of life in all of Asia
- Is reflected as the 3rd wealthiest nation in the world by popular Forbes Magazine.
What Does Singapore Bring to The Table For My Business?
You might be thinking these facts are nice and appealing and all, but how would incorporating your business in Singapore help grow your business? Let’s take a closer look as to why many business are moving to Singapore:
Singapore Has Incredibly Low Tax Rates
Singapore has unbelievably low tax rates, especially when compared to the United States. When a company is incorporated within Singapore, the tax brackets look like this:
|Singapore’s Tax Brackets|
|$0-$100,000*||Full Tax Exemption|
*Full Tax Exemption for the first 3 years under 100,000
As you can see, this is extremely appealing in terms of taxes. Compared to the United States, Singapore wins this match, hands down.
No Dividend or Capital Gain Taxes
When dealing with capital gain and dividends, corporations can sleep easy at night knowing that they will not be taxed.
If you’re a start-up company and tight on cash, Singapore has got you covered. When incorporating a business within said countries walls, the government allows companies to apply for government grants which pay up to 60% of technology costs.
Low Personal Tax Rates
Singapore’s relaxed tax brackets carry over to personal income taxes. At the bottom, a person’s personal tax rate may be as small as 0% and max out at 22% when reaching north of $300,000 annual revenue.
Under Singapore’s national laws, no auditing is required for privately owned companies which qualifies as a *small company.
As you can see, there is a lot that goes into deciding where to incorporate a company. Executives who are making this decision need to think about immediate, short-term, and long-term implications when deciding where to incorporate their business.
Singapore is a viable solution for virtually all business. No matter if you’re a small-town entrepreneur who’s on a shoe-string budget, or you’re a CEO of a multi-million dollar corporation, Singapore offers a considerable amount of benefits to any business.