Setting Up a Company in Singapore: A Detailed Guide
Singapore has been a preferred destination for companies looking to establish their presence in Asia due to its highly developed business infrastructure, stable political environment, and strategic location. Singapore is consistently ranked as one of the easiest places to do business in the world. The Singapore government has also implemented various initiatives and schemes to help businesses grow and prosper. In this article, we will provide a detailed guide on setting up a company in Singapore.
1. Types of Companies
There are three types of companies that can be set up in Singapore: Private Limited Company, Sole Proprietorship, and Partnership. The most popular type of company in Singapore is the Private Limited Company (PLC). A PLC is a separate legal entity from its owners (shareholders) and has limited liability.
2. Requirements for Setting Up a PLC
a. Shareholders: A PLC must have at least one shareholder and a maximum of fifty shareholders. Shareholders can be individuals or corporate entities.
b. Directors: A PLC must have at least one director who must be a Singaporean citizen, permanent resident, or an Employment Pass holder. The director must be at least 18 years old and cannot be bankrupt.
c. Company Secretary: A PLC must appoint a qualified Company Secretary within six months of its incorporation. The Company Secretary must be a Singaporean citizen, permanent resident, or an Employment Pass holder.
d. Paid-up Capital: A PLC must have a minimum paid-up capital of S$1.
3. Procedure for Setting Up a PLC
a. Name Reservation: An application for name reservation can be made through the Accounting and Corporate Regulatory Authority (ACRA) website. The name must be unique and not similar to any existing names.
b. Company Registration: Once the name reservation is approved, an application for company registration can be made. The application must be made through the ACRA website.
c. Memorandum & Articles of Association: The Memorandum & Articles of Association (MAA) must be prepared and filed with the ACRA. The MAA outlines the company’s objectives, activities, and internal rules.
d. Business Licenses & Permits: Depending on the nature of the business, certain licenses and permits may be required before commencement of operations.
e. Bank Account Opening: A bank account may be opened once the company has been incorporated.
4. Taxation and Compliance
a. Goods and Services Tax (GST): A company must register for GST if its annual taxable supplies exceed S$1 million. The current GST rate is 7%.
b. Corporate Tax: A company is taxed on its chargeable income at a rate of 17%.
c. Annual Filing: A company must file its Annual Return and Annual Tax Return with the ACRA and the Inland Revenue Authority of Singapore (IRAS) respectively.
FAQs
1. Can a foreigner set up a company in Singapore?
Yes, a foreigner can set up a company in Singapore. However, the foreigner must appoint a resident director and a resident company secretary.
2. What is the minimum paid-up capital for a PLC in Singapore?
The minimum paid-up capital for a PLC in Singapore is S$1.
3. What are the compliance requirements for a PLC in Singapore?
A PLC must file its Annual Return and Annual Tax Return with the ACRA and the IRAS respectively.
4. What is the corporate tax rate in Singapore?
The corporate tax rate in Singapore is 17%.
In conclusion, setting up a company in Singapore is a straightforward process. It is important to engage the services of a qualified professional to ensure that all the necessary requirements are fulfilled. Singapore’s business-friendly environment and robust infrastructure provide ample opportunities for growth and success.