Business Set up in Singapore : How can a foreigner start a business in Singapore ?

“How can a foreigner start a business in Singapore?”  and other questions around business set up in Singapore are some of the most frequently asked questions we receive at MBG Corporate Services. Not surprisingly – both because it is an affluent, highly developed economy and an extremely attractive investment destination and because we are a leading market entry consulting firm for business setup in Singapore.  In this piece, therefore, we talk about how to start a business in Singapore and the process of company formation and company incorporation in Singapore.

Why Start a Business in Singapore: An Attractive Highly Developed Economy

Singapore has a highly developed and successful free-market economy. It enjoys an open and corruption-free environment and has one of the highest per capita GDPs in the world. Its economy is characterized by stable prices and low unemployment.

Singapore’s economy grew 7.2 percent in 2021, which is broadly in line with the government’s official projection and rebounding from the recorded 5.4 percent contraction in 2020. Its annual GDP growth has been the fastest since a 14.5 percent expansion in 2010 when the economy emerged from the global financial crisis.

Naturally, entrepreneurs and investors are eager to start a business in Singapore. Singapore has attracted major investments in advanced manufacturing, pharmaceuticals, and medical technology production and will continue efforts to strengthen its position as South-East Asia's leading financial and technology hub.

Why Start a Business in Singapore: Key benefits of a business setup in Singapore

Singapore’s innovation ecosystem consists of high-quality infrastructure with a growing pool of dynamic start-ups and companies, well-trained talent, and strong government support. This is a key attraction for global businesses, leading to the huge demand for company incorporation in Singapore by the international business community. The following attributes are some of what make Singapore so attractive :

• Ease of doing business: Singapore is ranked 2 among 190 economies in the ease of doing business, as per the latest World Bank annual ratings.
• Hub of innovation: Ranked first in Asia for innovation according to the recent Global Innovation Index, and globally for innovation input with quality capital and research as a key pillar.
• Strong economic relations: Singapore is a signatory of the CPTPP, a party to the RCEP, and the founder of the ASEAN Economic Community. These lead to more trade and wider market access.
• Developed infrastructure: Constantly developed infrastructure and facilities to meet the demands of the economy, entrepreneurs, and businesses of the future.
• 100 percent ownership: can be in the hands of foreign entrepreneurs. International companies can retain full ownership and control of new branches or their newly established entities. This is a key driver of continued new Company Formation in Singapore.
• Tax incentives: Singapore has large tax incentives, easily understood compliance requirements, strong diplomatic policies and several business-friendly international tax agreements.
• Highly developed legal landscape: Strong respect rule of law, well-developed IP protection laws, and strict anti-corruption laws, among others, ensure smooth conduct of business. Strong and stable legal institutions encourage the setting up of business in Singapore for foreigners.
• Flat and uniform corporate tax: with no differential taxes for different goods and services. This means that the corporate tax paid is the final tax with no additional taxes imposed on dividends.
• Tax benefits for Business setup in Singapore: a variety of tax benefits, e.g., Global Trade Program (GTP) and Regional Headquarters Award (RHQ)  that foster the setting up business in Singapore for foreigners, nurture businesses, and aid regional expansions, attracting more and more company registration in Singapore for foreigners.

Business Setup in Singapore: Company Registration in Singapore for Foreigners – read, You!

Indian who’d want to start a business in Singapore? Setup company in Singapore?  You are not alone! Business setup in Singapore for Indian entities is highly – and understandably! – popular. More than 8000 Indian companies already have setup company in Singapore for regional markets. Singapore also wants to join Indian businesses in technology-driven areas to grow in the South-East Asian markets.

Outward Indian FDI to Singapore is globally one of the highest, making it one of the top destinations for Indian investments. Major sectors inviting Indian investments are IT, real estate, manufacturing, construction, renewable energy, and pharmaceuticals.

All of which brings us to the original question: How can a foreigner start a business in Singapore? How do you as an Indian setup company in Singapore for your business?

Here is a detailed comprehensive guide on company registration in Singapore for foreigners

How to  Start a Business in Singapore: The Process of Company Incorporation in Singapore

Registration and company incorporation in Singapore is easy and free of red tape. Additionally, the tax exemptions and benefits by the government of Singapore for new company incorporation in Singapore help them with a number of schemes in their initial days.

The Accounting & Corporate Regulatory Authority (ACRA) acts as the company registrar for Singapore company registration. It supervises the process of company formation in Singapore. It abides by the Companies Act, Chapter 50, whose requirements you must fulfill when you are looking to start a business in Singapore. Locals and business owners benefit by employing a registered filing agent for Singapore company registration. It is especially beneficial for company registration in Singapore for foreigners.

However, foreign entities cannot go through the Singapore company registration by themselves and must hire a local business registration provider.

How to  Start a Business in Singapore: Types of Entity Structures for Company Formation in Singapore

You can use the following business structures or entity types to register a company in Singapore and maximize tax benefits.

• Private Limited Company (LLC)
• Subsidiary Company
• Branch Office

How to  Start a Business in Singapore: Procedure for Company Incorporation in Singapore

The procedure of Singapore company registration is not very complex. However, we have simplified the whole process into 3 major steps.

Step 1: Getting approval from the ACRA for your company name

• The company name should be unique, readable enough, and free of vulgar language
• The company name shouldn’t infringe any trademark or violate any copyright issue
• The company name might need approval from higher authorities if the name comprises words like media, finance, bank, broker, legal, educational, etc. this may take a few weeks to process
• Once approved, the company name is possible for sixty days

Step 2: Preparation of documents to register a company in Singapore after name approval

The following documents are needed by ACRA:

• A brief description of the company stating business activities and company constitution
• Registered address details of the company
• Identity proof and details of all shareholders
• Identity proof and address details of directors with signed consent to act as directors
• Identity proof and address of company secretary with signed consent to act as company secretary
• Foreign investors need to submit copies of passports with overseas address details
• Identity verification and address proof details
• Professional backgrounds of all stakeholders and employees of the company

Step 3: Submission of ACRA application

Submission of an application to ACRA is the final process and can be done online. All documents should be in order to the official registration with ACRA and can be done in less than an hour to a few weeks depending upon the type of company establishment.

Once this is completed, ACRA sends an official confirmation through email vetting the incorporation of the company with its registration number. The soft copy is treated as a valid registration certificate. A hard copy can also be obtained through an online application. The cost of company formation in Singapore depends upon the type and size of the company that one is planning to establish in Singapore.

How to  Start a Business in Singapore: Requirements for company incorporation in Singapore

Following are the requirements for a new company formation in Singapore:

• The shareholding norm needs to be taken care of, and a private limited liability company must have a minimum of one and can have a maximum of 50 shareholders. Shareholders can be individuals or corporate bodies. ACRA allows a 100% foreign shareholding.
• The company secretary is a must and should be appointed within a six-month period of registration. The company secretary should be a resident of Singapore.
• A local registered address is required for a company office.
• The initial paid-up capital requirement is SGD1. Additional share capital can be invested at any point in time as well.
• A resident director is a must and can be a local citizen or permanent resident of Singapore or an Employee pass-holder.
• ACRA approval for the company name is necessary before initiating the Singapore company incorporation process

Documents required for company incorporation in Singapore are as follows:

-For Individual Shareholders

• Passport
• Address proof
• Resident ID card for Singapore residents
• Brief professional background

-For Corporate Shareholders

• ACRA Registration Certificate
• Company details with company name, registration number, and address
• Authorizing documents for holding shares in the company and appointment document of an authorized individual
• Document detailing ultimate beneficiaries with KYC due diligence

How to  Start a Business in Singapore: Business setup in Singapore with MBG Corporate Services

MBG offers a wide range of services for company formation in Singapore. Our seasoned professionals with years of expertise in new company formation in Singapore, huge client base, and experience ensure that you find all the support you need for business setup in Singapore. We assist you when you wish to setup company in Singapore right from the very initial stages of how to register a company in Singapore from India to the very end with the proper guidance, consultation, and customized services as per your needs.

For more information, please email us with your specific business requirements:- [email protected]

or contact us on +91 88601-90008