Incorporating A Company In Singapore As A Foreigner

Incorporate a company in Singapore with ease

New Opportunities in Singapore and Asia

According to Accounting and Corporate Regulatory Authority (ACRA) in 2022, there are 3000-4000 newly formed local and foreign companies in Singapore every month. Singapore is one of the easiest countries in the world to set up a company. The process is straightforward and there are few bureaucratic hurdles to jump through, making it an attractive destination for foreign entrepreneurs. The incorporation process is done completely online.

Foreigners can incorporate a company with 100% ownership

Just like a local Singaporean, a foreigner can register a company and own its 100% shareholding.

The incorporation process involves filing incorporation papers with ACRA. These documents must meet specific criteria to be accepted for incorporation. In addition to completing the paperwork accurately, companies must also comply with statutory regulations such as those related to taxation, employment law and intellectual property. If you are a foreigner looking to set up a company here in Singapore, this article will provide you with all the essential details.

Key Requirements for foreigners to set up a new company in Singapore

Getting Started

As a non-resident or foreigner, you must appoint a local director and engage a reliable filing agent to register your company in Singapore as you cannot self-register their company. As a registered filing agent, Singapore Corporate Services can manage this process for you.

Things to consider when setting up a company in Singapore

There are several important considerations to take into account. These include selecting an appropriate business structure, understanding Singapore’s incorporation and tax laws, ensuring compliance with relevant regulations, selecting the right corporate service provider, and finding suitable office space.

Additionally, it is important to consider the time frame involved when incorporating a business in Singapore, as it can take up to two weeks for incorporation documents to be processed. With all the incorporation documents ready in hand, a commonly purposed business can be incorporated within one to three days.

Preparing for Incorporation –

Choose the right business structure for your company

A foreign individual can register the following businesses in Singapore:

Private Limited Company
Sole Proprietorship
Limited Liability Partnership

Business structures

Private Limited Company (Pte Ltd)

A private limited company is a favoured business structure for most businesses.
1-50 shareholders (owners).
At least one local director who is ordinarily a resident of Singapore.
A private limited company has a separate legal identity from its owners and It has the rights of a person.
It has perpetual existence.
Pte Ltd limits the liability of its shareholders to the amount they have invested in its shares.
It pays corporate tax (0%-17%).
Banks and financial institutions perceive Private Limited Companies as more trustworthy than sole proprietorships or partnerships, allowing them to acquire funding for expanding their business operations.

Sole Proprietorship

For our clients, we recommend a sole proprietorship only when their venture is virtually risk-free. This business structure represents an unincorporated firm and can be highly beneficial in low-risk scenarios. Since the sole proprietorship has no separate legal entity from its proprietor, the owner has unlimited liability towards its debts and losses.
The income of a sole proprietorship is considered as that of its owner and so the business owner will pay an income tax (0%-22%).

Limited Liability Partnership (LLP)

Under the Singapore Company Law, two or more individuals and/ or corporate can register a partnership.

LLP has separate legal existence from its owners.
The liability of its owners depends on their carelessness, actions or inactions leading to LLP’s loss.
The partners need to pay personal income tax (0%-22%) on their income from LLP.

A limited liability partnership combines the benefits of a partnership and a company. It allows them to pool their complementary skills & earn a profit.

Why select Private Limited?

Out of these options, a Private Limited Company is viewed as most credible by financial institutions and other businesses and is therefore a popular choice despite the additional filing requirements.

You have to appoint a Local or Resident Director

Even if you have a valid Employment Pass in Singapore, you will still require a local director and a Letter of Consent from your employer and the Ministry of Manpower. How you, as a foreigner, can appoint a Local Director:

Option 1: Appoint a local nominee director for your new company.
Option 2: Hire a Singaporean, Permanent Resident, or EntrePass holder to be the local director.
Option 3: Acquire an EntrePass for the foreigner to be applicable to form a company

Option 1 is the common arrangement and involves the least administrative hassle. The company would sign a contract with the nominee director to keep this appointee out of your business activities. The appointee will not be a bank signatory – so you alone will have full control over the company and its corporate bank account. If you work with us, Singapore Corporate Services will source for an appointee and establish this arrangement with the necessary paperwork.

Other criteria

You will need at least one shareholder and a registered address for the office. It is important to note that only individuals over 18 years of age with full legal capacity are eligible for this role, and those who have undischarged bankruptcy can not be appointed as directors. Shareholders can be natural persons or corporations and can be local or foreign. Furthermore, Singapore allows for 100% company ownership by foreign shareholders. To become a shareholder, an individual must first purchase shares of the company. By buying shares, a shareholder is the owner of the company.

What is the cost of incorporating a company in Singapore

The ACRA fee for

Company name application is S$15 (Reserved for 60 days, to extend it, you need to pay extra fees).
The company registration fee is S$300.

After registering with ACRA, you will receive a confirmation email that serves as your Incorporation Certificate. You can obtain an official hard copy of this certificate by paying the applicable fees.

After successfully incorporating

You have to appoint a Corporate Secretary for your Singapore Company

Appointing a corporate secretary for your Singapore company is a regulatory requirement. You need to do so within 6 months of the date of company incorporation or else you could face penalties. ACRA considers secretaries as officers of the company. They liaison with the authorities and world outside of the company and enable its managers to work without distraction.

If you are hiring a company secretary for a public company, you need to appoint a certified secretary from a reputable institute.

If you are hiring for a private limited company, make sure that the appointee is qualified and well-versed with the tenets of the Company Act. They need to be experienced in handling the duties of the job.

After engaging us as your corporate secretary, Singapore Corporate Services will complete the necessary paperwork and update ACRA to meet your compliance needs.

Apply for a corporate bank account

After your company has been registered, and before undertaking any business activities, you can open a corporate bank account to enable financial transactions.
With over 127 banking institutions in Singapore, you can easily find the perfect bank for your requirements. To open an account with any of these banks, simply ensure that you have all the necessary documents on hand.
To open a corporate bank account, you need to provide accurate and properly signed forms:

Proof of residency for stakeholders such as local directors, signatories, and the ultimate beneficiary owner
Certificate of Incorporation from ACRA
Company’s Business Profile from ACRA
Signed resolution to open account by the Board of Directors & Signatories to the account
Certified copy of Company’s Memorandum & Articles Of Association (M&AA)
Copy of Passport or SingPass
Certificate of Incumbency & Certificate of Good Standing (For Offshore Accounts Only)

Why you’ll need a corporate service specialist

We understand the compliance needs of your businesses.

Singapore Corporate Services helps businesses hit the road running.

Often this starts with setting up the right type of company that’ll achieve its business objectives.

Companies that aim to develop a presence in Singapore typically take the form of

Subsidiary Company
Branch Office
Representative Office

Subsidiary Company

A subsidiary company is a form of limited liability company.
The parent company can own 100% of its shares.
A subsidiary company is a separate entity from its parent company.
The parent company’s liability is limited to its share capital.
The parent’s assets are not used to pay the debts and losses of the subsidiary.
After forming a subsidiary company, the parent company will have to relocate one of its employees to Singapore to take charge. The employee will need an Employment Pass to work in Singapore.

Branch Office

Most foreign SMEs prefer to register a branch office in Singapore.
A branch office is a legal entity after registration.
It is an extension of its parent company.
The parent company is responsible for all the debts and liabilities incurred by its branch office.
The branch office must hire at least one ordinarily resident Singaporean.

Representative Office

A foreign company can set up a representative office in Singapore. Its purpose is to research the business potential of the Singaporean marketplace.

It conducts feasibility studies.
A representative office does not have a legal identity separate from its foreign parent company.
It must also appoint not more than 5 employees.
It cannot indulge in any profit-making activities.
The parent company should be an established company for more than 3 years, with an annual turnover of more than S$250,000. In case it gets dissolved, the representative office gets de-registered.

Whether you are looking to expand your business with a subsidiary office or set up a representative office to establish a new testbed, you should engage a local corporate service to minimise the hassle and setup time needed for registration, office space, economic grants, manpower, and other compliance requirements; Then you can focus on the principal activities of your business.

Why incorporate in Singapore?

Pro-business environment

Singapore has become a major centre for many of the world’s leading companies. It is home to a range of multinational corporations, including such well-known names as the United Overseas Bank (UOB), the Overseas-Chinese Banking Corporation (OCBC), and DBS Group Holdings. In addition, Singapore has emerged as an important regional hub for many international businesses, making it a great choice for incorporation.

Additionally, Singapore has a well-developed infrastructure, with excellent telecommunications, transport and banking facilities. Incorporation in Singapore offers numerous advantages for businesses, including tax efficiency, access to government incentives, a strong legal system, and an attractive reputation for business This makes doing business in Singapore a smooth experience. Finally, Singapore offers a stable political environment and strong economic prospects, making it an ideal place to do business.

Challenges of incorporating a company in Singapore

While setting up a company in Singapore is an attractive option for foreign entrepreneurs, there are still some challenges that need to be addressed before incorporation can take place. Foreigners must also be aware of the potential risks associated with setting up a business in Singapore, such as employment laws, labour disputes and litigation. In addition, they need to be aware of intellectual property rights, legal compliance issues and environmental considerations. For instance, any business engaging in import-export activities must ensure that it complies with applicable import-export laws and regulations. Furthermore, businesses should also consider safety standards for product design or manufacture before proceeding with the incorporation.

Incorporation may require professional advice from accountants or consultants who can provide advice on various aspects of incorporation such as financial compliance or establishing an audit trail for taxes. These professionals are valuable resources for ensuring compliance with local laws and regulations that foreign entrepreneurs might not otherwise be aware of or understand. Moreover, businesses will need to obtain relevant licenses or permits from the ACRA before proceeding with incorporation.

Finally, foreigners should consider if their chosen business name meets Singapore’s registration requirements prior to submitting an application for incorporation. This includes conducting a company name search on ACRA’s website to ensure that no other existing companies share the same name. The chosen name must also not infringe upon any registered trademarks or copyrights belonging to other entities in Singapore either directly or indirectly through its use of words or symbols relating to another entity’s trademarked brand name or copyrighted material respectively. Failure to do so could result in costly legal action taken by affected parties.

By working with a Corporate Service Specialist, you’ll avoid these common pitfalls.

Incorporate with ease

The incorporation process can seem confusing and overwhelming, but with some guidance from experts, it is possible to quickly set up a company in Singapore that meets all of your business needs. If you’re having any difficulty and want a trusted provider to manage your incorporation process, you can turn to Singapore Corporate Services for help. Our incorporation services provide comprehensive guidance and support to business owners overseas who are looking to incorporate their business in Singapore can contact us for assistance with the incorporation process.

For assistance and to engage as your corporate services provider

Please visit our website, or contact us via email. We look forward to helping you with incorporation in Singapore.