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Beginner’s Guide on Starting a Travel Agency in Singapore
The tourism industry remains a viable and important industry in Singapore. With low crime rates, developed infrastructures, and numerous attractions, it is an ideal tourist destination. Consequently, In 2019, Singapore attracted about 19 million international tourists. Even with the current pandemic, the industry appears to be thriving, though with added conditions.
Popular attractions include the Singapore Zoo, Jurong Bird Park, Sentosa, Fort Siloso, Gardens by the Bay and Jewel Changi Airport. Singapore is also known for its world-famous Marina Bay Sands and Resort World Sentosa, which are popular resorts with casinos. There is also the Universal Studios theme park, a very well-known tourism destination. In short, Lion City is truly an exciting place to be, with lots to see and experience.
Whether catering to locals or foreign visitors, engaging with a travel agency can be extremely helpful. These agencies can help people plan and make the most out of their vacation. Travel agencies are mightily beneficial to those travelling alone, exploring a country for the very first time and families with children or elderlies. Given the demands for such services, starting a travel agency in Singapore may prove to be a prospective investment opportunity. This beginner’s guide article will serve as a general guide in starting a travel agency in Singapore. Want to know more about company registration? Read our comprehensive guide to company registration in Singapore!
What is a Travel Agency?
A travel agency specialises in providing travel and tour packages to various destinations. The services provided by these agencies can involve travel by air, land or sea. Travel agencies can be private retailers or public services. They often also offer a wide assortment of recreational arrangements for tourists. If you live in Singapore, travel agencies can help to arrange your trips and holidays abroad. On the other hand, if you are a foreigner, engaging with a local travel agency can help you get around the country as well!
Travel Agencies can also provide access to transportation, car rentals, accommodations, hotels, cruise lines, insurance, reading materials and more. These services offer tourists major conveniences and ease of access. People will be spending less time planning or looking at their watches and more time enjoying themselves. Setting up a travel agency is just like setting up a new company. However, it comes with its own unique challenges. Naturally, there will be an incorporation process, licences, applications and other formalities.
The Registration Process
There are two major components to company registration and licencing. These two are statutory requirements and compliance. You can either have these done on your own or enlist the help of reliable company incorporation services. Either way, this is to ensure compliance with Company Law and the Singapore Travel Agent law.
Registration is necessary to conduct business as a travel agent. Filing for it can be under the Standard Industrial Classification (SSIC). Code 78211 for Travel Agents And Tour Operators, or 78212 for Ticketing Agencies. These are depending on the nature of your business. Before registering, you need to decide on what type of company you will form. The licencing body of Singapore is the Singapore Tourism Board (STB). The licence of interest here is the Travel Agency Licence (TAL). Having TAL allows business owners certain rights and the capacity to operate. This is in accordance with Section 4 of the Travel Agents Act (Cap. 334). You can apply for the license online.
Company Registrations and What You Should Know
First of all, you will need to register with the Accounting and Corporate Regulatory Authority (ACRA).
Before registering with ACRA, you may wish to clearly establish several details, including the type of business structure, company name, directors, shareholders, company secretary, and paid-up capital. You will also need a registered address (for mailing purposes) and establish taxation details. Tax rates, exemptions and incentives may vary depending on your company. You may visit ACRA for more information.
If you are a foreign investor, you may also register your company with the ACRA. The process is similar in many ways but will vary on several accounts. You will need to decide if you will need a visa if you want to be physically present in Singapore. Apart from that, you will be required for an Employment Pass or an Entrepreneur Pass. It is recommended that if you are a foreign investor, to engage with incorporation firms for assistance.
As hinted before, there are several types of business entities you can choose from, namely, private limited, limited liability, sole proprietorship and company. Usually, most travel agencies go for either a sole proprietor or limited liability. Regardless, every business entity has its unique pros and cons. Given how choosing a business entity is one of the most significant decisions you will take as an entrepreneur, consulting a company incorporation firm for professional advice would be a wise move.
Requirements for Licence
Before the process of obtaining a licence can begin, several articles and information are necessary. Your company needs to have a paid-up capital of at least S$100000. Additionally, it would be best to appoint a key executive with relevant qualifications and approve this figure to be the STB. The executive will need to either be a Singaporean citizen, permanent resident or employment pass holder.
STB also takes into consideration the individual characters before approving any executive appointments. Good moral character, reputation and fame are ideal. The STB can also ask for additional details such as letters of good conduct, police clearance and credit backgrounds. In other words, you need a good candidate for the job.
Next, creating a company email address for the use of the Travel Related Users System (TRUST). TRUST is a state-sanctioned website that contains many resources on the travel industry in Singapore. This means you need a business website to operate the business, and for that, you need a company email address. Whilst fulfilling this requirement, compliance to the TRUST must be taken into consideration. You can also apply for a travel agent licence here.
Finally, you will need a business office to run the business and only for said business. If you are freelancing or operating from home, consult with the Housing Development Board (HBD) or Urban Redevelopment Authority (URA). You will also need a signboard that reflects the nature of your business. Meeting these conditions is crucial before the STB would grant the licence.
Licence Application Process for Starting a Travel Agency in Singapore
Filing for any travel agency can be done online through STB’s website. The application will take about three to five working days to process unless authorities deem further background checks are warranted.
Typically asking you to submit a Tenancy Agreement (TA) for the premises you will be conducting business at. TA should be valid for at least one year, and if you own the premises, evidence of ownership is needed. Upon meeting the stated needs, the STB will give its final approval. Finally, if all went well, you will receive your final approval letter. Once you receive the letter, you can head over to the Singapore Travel Agency to collect your licence. There is a S$300 licence fee you will need to pay
Starting a travel agency in Singapore is just the start, and to ensure the business is legal, there are long-term formalities. Regardless of the type of company you create, statutory compliance is an absolute must. Resources must be allocated to ensure accountability in this department. Keep in mind that carelessness and non-compliance can incur penalties.
When incorporation is successful, you will receive a certificate of incorporation and a company business profile. Apart from that, you will also acquire a licence and company stamp. Given that the company may have shareholders, the first board resolution or meeting has to take place. In this event, share certificates will be issued to respective shareholders. Yearly filings need attention, such as accounting requirements, annual general meetings, annual returns filing, corporate tax filing, and financial year determination. These mechanisms keep the business running sustainably.
There is also the alternative to hiring a corporate service provider to delegate the yearly filings as well as in other affairs. The conventional approach is to assemble a group of employees overseeing these. However, they can be costly in many respects. Outsourcing these can put less attention strain on your company, allowing it to focus more on business.
Need a Hand?
Singapore has a competitive tourism market, and investing in it has much potential. Still, starting a travel agency is no easy feat though the process is relatively direct. You will need to go through much research and formalities before you can open up your business. It can take some time, and if that is not a luxury you have, there is an alternative.
We are 3E Accounting, a well-established corporate service provider specialising in providing comprehensive digitised business solutions. Application, registration, incorporation, licencing and more, 3E Accounting can handle them for you! Our team of multidisciplinary experts are ever ready to assist you before, during and after your business has been established. Backed with uncompromising quality, recognition from authorities and professionals, 3E Accounting prides itself on serving only the best services. Contact us today to get your business off the ground!