Singapore is one of the best-known cities for doing businesses. The World Bank ranked Singapore as the world’s 2nd best place to set up and run a business. Its entire suitable bureaucratic system and the simple laws are quite good enough to attract a lot of foreign investors. Singapore is now a major center for a transportation hub, business, and trade inside the South East Asia region. Its reduced tax liability, stable political environment, advanced banking facilities, and other beneficial nature helped to gain a huge international reputation. The stable economic environment of Singapore makes it the best choice for the formation of an offshore company. Besides, offshore company formation in Singapore is very easy since it takes no time at all.
So, new investors can set up an offshore company in Singapore without major difficulties. But first, one needs to understand the key requirements for completing the whole offshore formation process. They need to complete the following details for the offshore company formation in Singapore:
Important steps for the offshore company registration SG
Before setting up an offshore company a client has to go through some important steps for the registration process. The steps are:
ACRA Approved Company Name:
- The name of the proposed company must need to approve by the Accounting and Corporate Regulatory Authority (ACRA).
- The proposed name of the company has to be unique, suitable and meaningful.
- The proposed name can’t be alike to any other existing company name or from any black-list.
- The name can’t disobey any trademark or copyright laws.
Board of Resident Directors:
- The offshore company should at least have one local resident as a member of the board of directors. It can Singapore citizen, permanent resident or work pass owner.
- An extra foreign or local board member can be select.
- The directors can’t be any corporate body and must be 18 or above in age.
- The offshore company must have at least one local or foreign shareholder and can have the highest of 50 shareholders.
- A director can also become a shareholder.
- The shareholder of the offshore company can be a corporate body or an individual.
Resident Company Secretary:
- The offshore company must need a local resident and qualified professional company secretary.
- The company secretary of the offshore company can’t be any corporate body. He or she needs to be a natural person.
- Any director or shareholder can’t act as the company secretary of the offshore company.
- Singapore doesn’t need any least capital for company registration.
- The offshore company requires at least $1 as their paid-up capital.
- No authorized capital required for the company registration.
Legal Registered address:
- The offshore company needs to have a residential or a commercial registered address.
- A PO Box must not support.
- An offshore company must engage a professional firm to register the company in Singapore.
- Singapore law don’t support self-register of any foreign individuals or entities.
Business Licenses and Permits:
- In Singapore, the offshore company will need a proper business license. It will depend upon the nature of the offshore business.
- The license needs to collect from the relevant government agencies after the formation.
- The offshore company needs Memorandum & Articles of Association. Details about Directors’ rights, Shareholder approval if required, company management etc.
Registration for GST:
- The offshore company in Singapore might need to register for Goods and Services Tax (GST).
Required Documents for Registration of Offshore Company
The offshore company will need to prepare some documents for the offshore registration procedure. These following are the documents necessary to submit to the registrar:
- Original copies of passport (all the proposed directors and shareholders).
- KYC documents- Original Offshore residential address proof of proposed shareholders and directors.
- Bank reference letter, Personal and business profile and activity and details of the company secretary.
- Details of the parent company (if any).
- Memorandum and Articles of Association (M&AA).
- Need to reserve a trade name with the Accounting and Corporate Regulatory Authority.
- Foreign investors should select three different names to avoid any problem. Then they submit them for approval with the Trade Register.
- Company name should be in English.
Opening Bank Account for offshore companies in Singapore
Singapore is an outstanding example of having a sustainable, stable and adequate banking system. To set up an offshore company in Singapore the investors will need to open a bank account. The offshore company can choose their desired bank from various reputable banks in Singapore.
Required mandatory Documents for opening a bank account:
- International passport
- Proof of house (longer than 3 months ago)
- So-called business proof of ownership
- Resumes of Shareholder and Directors
- Reference letter from client’s personal account.
Procedure for opening bank accounts:
The process of opening a bank account may take 2-15 days depending on the banks working schedules. The following are some requirements for opening a bank account:
- The required opening deposit is USD 30,000.
- Personal attendance is necessary to open an account (Shareholders, Directors, and CEOs).
- Need good practical knowledge of the English language.
Effective Corporate Tax Rate for Startup Companies in Singapore (YA 2019)
|Chargeable income ($)||Estimated tax (S$)||Effective tax rate|
Advantages and Disadvantages of an offshore company formation in Singapore
|Offshore company set-up is very easy||Less transparency|
|Singapore has got eye-catching Tax benefits||Not legally eligible to employ staff|
|Relaxed migration and foreign ownership policy||Lack of exchange of information|
|Great banking services||Can’t lease any physical office space|
|Constant political, economic and trading environment||No substantial activities|
Singapore has been a business hub for many MNCs by representing a tax effective corporate entity. Offshore company formation is so simple and easy to manage in a stable political and economic environment like Singapore. The suitable government with sophisticated banking facilities of Singapore encourages a lot of foreign investors to invest there. Singapore provides the least risk with wider benefits for new company investors. So, Singapore is the best choice for offshore company development and entrepreneurial activity.