18 Factors to consider while incorporating a company in Singapore

Singapore company formation

Are you planning to incorporate a company in Singapore? Great choice!


In the realm of international business centers, Singapore shines as the favored choice for establishing companies, thanks to its strategic positioning, business-accommodating regulations, and resilient infrastructure. 


Nonetheless, embarking on this endeavor demands thorough planning and contemplation of diverse elements to guarantee a seamless and triumphant process of incorporation.


In this blog post, we’ve shared 18 important factors that must be considered when venturing into the process of company incorporation in Singapore.


  • Business Structure: Choose the appropriate business structure based on your goals and needs, such as a private limited company, sole proprietorship, or partnership. A private limited company is often preferred for its liability protection and ease of raising capital. Hire a professional business consultant in Singapore to choose the right business type.

  • Company Name: Select a unique and meaningful company name that reflects your business activities. Ensure it complies with Singapore’s naming guidelines and is available for registration.

  • Shareholders and Directors: Appoint at least one shareholder and director who can be a Singaporean resident, permanent resident, or Employment Pass holder. Foreign individuals can also be directors. Consult a corporate secretary in Singapore to know more about this.

  • Paid-up Capital: Decide on the initial paid-up capital, which can be as low as SGD 1.00 for private limited companies.

  • Registered Address: Maintain a local registered address where official documents and notices can be sent. A P.O. Box is not acceptable.

  • Company Secretary: Appoint a qualified Singapore company secretary within six months of incorporation. The company secretary ensures compliance with legal obligations.

  • Memorandum and Articles of Association: Draft and submit these documents, which outline the company’s structure, objectives, and operational procedures.

  • Business Activities: Clearly define the nature of your business activities in the registration documents. Certain activities may require additional licenses or permits.

  • Share Allocation: Allocate shares among shareholders, outlining ownership and voting rights. Ensure proper documentation of share transfers.

  • Taxation: Understand Singapore’s tax system, which includes a flat corporate tax rate and various incentives for new companies. Consult with tax professionals to optimize your tax strategy.
    Recommended post: 35 Tax-related tasks that a tax advisor in Singapore can help you with 

  • Employment Passes and Work Visas: If hiring foreign employees, apply for the appropriate work passes and visas to ensure legal compliance.

  • Intellectual Property: Protect your intellectual property through copyrights, trademarks, and patents. Singapore offers a robust IP framework.

  • Bank Account: Open a corporate bank account in Singapore to manage financial transactions. Most banks require physical presence during account setup.

  • Annual General Meeting (AGM): Hold an AGM within 18 months of incorporation, followed by annual AGMs to discuss financial matters and report to shareholders. Your company secretary can help you to conduct AGMs regularly.

  • Annual Returns: Submit annual returns and financial statements to the Accounting and Corporate Regulatory Authority (ACRA) within specific timelines. Your tax agent can help you to compute and file all the required annual returns to ACRA.

  • Goods and Services Tax (GST): Register for GST if your company’s annual turnover exceeds SGD 1 million. Monitor changes in GST regulations. Consult a GST expert to check if you need to file GST taxes.

    Recommended post: Navigating through Goods & Services Tax (GST Tax) in Singapore

  • Employment Regulations: While incorporating a company in Singapore, it’s important to comply with Singapore’s employment laws, including proper record-keeping, working hours, and leave entitlements.

  • Licensing and Permits: The company incorporation process also involves obtaining the necessary licenses and permits for specific industries such as finance, healthcare, food services, and more. Consult a professional business consultant in Singapore.


Conclusion

Incorporating a company in Singapore offers numerous advantages, but it requires careful consideration and adherence to legal and regulatory requirements. From choosing the right business structure to understanding tax implications and employment regulations, each step is crucial for a successful incorporation process.

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ACRA Cancels Registration of Filing Agent and Qualified Individual for AML/CFT Breaches

The Accounting and Corporate Regulatory Authority (ACRA) had cancelled the registrations of filing agent (RFA) and qualified individual (RQI) on 18 January 2024. The registrations were cancelled in view of breaches of anti-money laundering and countering the financing of terrorism (AML/CFT) controls under the ACRA (Filing Agents and Qualified Individuals) Regulations 2015 (the “ACRA Regulations”).

Some of the basic AMT/CFT controls that a RFA and RQI are required to exercise are as follows:

(a) perform additional customer due diligence measures when a customer is not physically present during onboarding;

(b) inquiring if there exists any beneficial owner in relation to some of its customers; and

(c) perform risk assessments i

RQIs and RFAs provide corporate secretarial services for business entities, such as helping customers to incorporate companies, file annual returns and fulfil other filing requirements under the Companies Act 1967 or other Acts under ACRA’s purview. RQIs and RFAs are required to perform customer due diligence measures in accordance with the ACRA Regulations, and conduct their business in such a manner as to guard against the facilitation of money laundering and the financing of terrorism. RQIs and RFAs must also satisfy statutory requirements such as being fit and proper persons, to be registered or continue to be registered.

RQIs and RFAs who breach their statutory obligations may be subject to enforcement actions, such as financial penalties of up to $10,000 or $25,000 per breach respectively or have their registrations with ACRA suspended or cancelled.

Therefore, RQIs and RFAs play an important role in helping to detect and combat illicit activities.

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