Singapore is one of the convenient countries in South East Asia where starting a business is very easy and the country ranked second for ease of doing business category by World Bank in 2016. Singapore got a comparatively small landmass with only 5.60 millions of population and among them, 3.60 million are skilled workforces.
It takes about 2.5 days in Singapore to start a business with just only three steps and procedure. Additionally, the country got the free trade agreement with more than twenty countries and thirty-one trading partners. The country enjoys the flat tax rate of 17%.
One of the major parts of starting any new business in Singapore is the incorporation process and all companies in Singapore must be registered with Accounting and corporate regulatory authority (ACRA). Starting a company in Singapore is a visionary choice for potential investor and there are many options available from where a potential business investor may choose the right category.
Limited liability Company Singapore or LLC is one of the most popular and widely used company vehicles for Singapore. In this article, we are going to discuss LLC Singapore and all other details regarding Singapore LLC.
Any LLC Singapore can be registered under the company act of Singapore under chapter 50 and according to the law a Singapore LLC may have own legal personality, they may own property and also got the right to enjoy perpetual succession.
Additionally, a limited liability company in Singapore may sue another company or be sued on its own name. it is the requirement for the LLC companies to appoint a secretary who is a resident of the country and the secretary is responsible to make sure that the company is running according to proper laws and regulation enforce by ACRA.
The secretary also implements the decisions of a company’s directors. The Company secretary Singapore can be a Singaporean or foreigner who is holding permanent resident or person holding employment visa of Singapore. However, the directors can be appointed as the secretary of the company as long as he is not the only director of the company.
Registration procedure for Limited liability Company in Singapore
Limited liability Company in Singapore has the bindings of having a registered address in Singapore. The address of the company must be a physical address and cannot be PO Box address. The residential address may be situated both in the commercial or residential area; however, the office should have public access during general work hours of the country. There is no minimum requirement for LLC Singapore and one may open up LLC Company just with the investment of one dollar.
After opening the company, one may increase the deposit amount anytime. This is not always a good idea to begin the company just with one dollar deposit. This is because there are many other related services that require a higher deposit amount. For example, opening a company bank account in Singapore requires at least $1000.
The law forbids the number of the shareholder for LLC Singapore to be more than 50 and less than 20. If the number of shareholders becomes more than 50 then the company may regard as the public company. There is the tax exemption for new LLC companies and for the first three years of operations new companies get hundred percent tax exemption for the first $100,000 of income that is chargeable and also gets additional fifty percent tax exemption for next $200,000. If the profit margin of LLC Singapore becomes more than 300,000 than the flat tax rate applies which is 17%.
Regardless the company is a startup or operational company. All companies in Singapore enjoys seventy-five percent tax exemption on their first $10,000 income that was normally chargeable and fifty percent tax exemption for their next $290,000 income that was chargeable.
So the maximum exempted amount that may be enjoyed is $152,000. For any company in Singapore if the profit is more than 300,000 than they may face a flat rate tax which is 17%. Recently new law applies in the tax segment and LLC Singapore should pay fifty percent of tax rebate that is corporate tax payable. The maximum amount of rebate payable cannot be more than $20,000.
Another requirement for the Limited liability Company in Singapore is to conduct the audit. In 2015 Singapore introduced a new small company concept and the aim of the law is to save time and cost of the annual audit for the companies. According to the law, the small company is exempted from conducting an annual audit.
Any private company including LLC Singapore may regard as a small company if their total sum of revenue is not more than $10 million and the total sum of the asset is not more than $10 million and also the number of employees of the company is not more than fifty personnel. For the benefits mentioned above the LLC is one of the most popular business vehicles in Singapore.