Singapore is an acclaimed destination for doing business. There are plenty of reasons that keep on motivating young entrepreneurs and investors to incorporate a business in Singapore. Different entrepreneurs have various reasons to incorporate a business in Singapore. Irrespective of the reasons or irrespective of business type, Singapore for sure is the chosen and widely preferred country to do business.
Most of the foreign investors like to incorporate their business as a private liability company also referred as Pte. Ltd. company in Singapore. Being a separate legal entity, a private limited company is the most flexible, and robust business structure in Singapore.
According to the Singapore Companies Act, a company incorporated as “Limited Liability” does not hold company shareholders liable, for any debts the company has incurred exceeding the total share capital contribution to the company. This makes shareholders liable, only for the total share capital they have contributed to the company. A private limited liability company can be incorporated by any local or foreign individual above the age of 18 years. Remember, companies incorporated under this business structure are not allowed to have more than fifty shareholders.
Unlike a sole proprietorship and partnership firm, a private limited company in Singapore offers many advantages to the entrepreneurs. Protecting personal assets of the individual investors and providing them specific tax benefits are two main benefits of incorporating a private limited company in Singapore. Besides, dividend allocated to shareholders is exempt from taxes and allows foreign directors, as well as shareholders, to apply for the Employment Pass.
Incorporating a business in Singapore (www.nomineedirectorservices.com.sg/company-incorporation/) is accessible to foreign investors, only if they seek assistance from external firms offering incorporation services in Singapore. Usually, the incorporation process is divided into two major steps. The first step is to register the company name and second is to incorporate a company under the registered name with Accounting and Corporate Regulatory Authority (ACRA). Usually, foreign entrepreneurs find navigating the process of company incorporation in Singapore a bit challenging.
This article is entitled to illustrate five options for them or to anyone interested in registering a business in Singapore
1) Choosing the Business Name:
Before starting the actual incorporation procedure, it is important to choose the company name. It would be better if you select the name that will identify or highlight the products or services you will be offering. Having more than one name ready for approval always pays up, as ACRA has strict norms regarding company names and its approval. If everything is alright and your chosen company name does not violate any terms and conditions put forth by ACRA, it takes few hours to approve your business name.
2) Nature of Business Activity:
There are certain businesses where you need appropriate licenses and permits to start and operate your business. Banks, insurance companies, financial institutions, bars, casinos, private schools, recruitment and traveling agencies are some businesses requiring business-specific licenses and permits. Apart from that, businesses intending to import goods as well as businesses intending to manufacture and sell products, liquors or foodstuffs within Singapore will require special licenses and permits from specially appointed authorities.
3) The Initial Paid Up Capital:
Actually, this is important, but not-much-anticipated step in the process of Singapore business incorporation. Singapore Companies Act does not impose any restrictions on minimum paid up capital. An entrepreneur can register his/her business in Singapore with an initial paid-up capital of one Singaporean dollar. While, there are no any restrictions on the type of currency. As an entrepreneur, you are allowed to use any money as share capital for your business. Nevertheless, it would be better if you start your business with a massive amount as incorporating a traveling business will require an initial paid-up capital of about S$10, 000.
4) Appointing Company Director:
Anyone above the age of 18 years and under 70 years old can be appointed as a company director. Provided that the selected person should have clean records and should not possess a history of declared bankruptcy. There should be at least one director who should be a permanent resident of Singapore. In case if you want to appoint a foreign director then he/she should possess a valid Employment Pass. As per the Singapore Companies Act, an interim nominee director acts as a manager of the company, until the foreign director receives his/her employment pass. The acting director will resign after the foreign director obtains employment pass.
5) Determining Shareholders:
Determining and approving shareholders along with their paid-up capital contribution is one of the major steps to register a business in Singapore. At least one director and maximum fifty shareholders are allowed to a private limited company. Besides, foreign or even local shareholders are entitled to own 100% shares in a company.