Singapore Offshore Company

Singapore has established itself as a prominent hub for business and finance in Asia, thanks to its robust legal system, favorable tax rates, and business-friendly environment. Incorporating a company in Singapore offers various advantages, including access to a strategic location, well-developed infrastructure, and an attractive tax regime. The process is straightforward and can often be completed rapidly, with the added convenience of online procedures for company registration and opening a business bank account.

Selecting the appropriate business structure is a critical decision for anyone looking to form a company in Singapore. The most common form of legal entity chosen by entrepreneurs and businesses is a private limited company, which provides the benefit of limited liability to its shareholders. To incorporate a company, one must meet certain requirements, including appointing key personnel such as directors and a company secretary, as well as having a registered address in Singapore. Understanding the legal and regulatory framework is essential to ensure compliance and to take advantage of the country's business environment.

For entrepreneurs seeking to leverage Singapore's business-friendly environment, Offshore Protection offers comprehensive assistance in navigating the company formation process. Our expertise ensures a smooth transition into the Singaporean market, helping you capitalize on the country's strategic advantages.

Singapore Company Registratrion

A Singapore offshore company formation called a Private Limited Company is one of the most sought after corporate structures in the world due to the jurisdiction's supportive corporate laws, tax incentives, and strong financial center.

Singapore is often referred to as an offshore jurisdiction because of its low tax-rates even though Singapore corporate law makes no distinction between on-shore and off-shore company structures. All companies are incorporated through the Singapore Companies Act Chapter 50 and are regulated by the Singapore Accounting and Regulatory Authority (ACRA).

Singapore has an outstanding reputation thanks for its ease of doing business, economic freedom and rule of law, making it a highly sought-after jurisdiction making it one of the leading Asian cities.

Singapore boasts as having one of the strongest banking systems in the world and as a result is home to many international branches and multinational companies thanks in-part to the jurisdictions numerous incentives that among them give tax-breaks to foreign branch and company headquarter offices.

The jurisdiction operates of a territorial tax-based system, allowing 100% foreign ownership of companies and gives a number of exemptions to newly formed companies. Income that is repatriated from abroad is not subjected to local taxation.

Offshore Companies are also free from any capital gains and dividends tax if companies retain non-resident status. Singapore companies have the comfort of being regulated in a legal system that has very defined corporate laws and norms of conduct, as well as a strong regulatory framework, giving companies access to it wide range of Double Taxation Treaties.

For more information on the Advantages of Singapore as an Offshore Financial Center, click here.

Key Takeaways

• Singapore offers an attractive environment for company formation with a straightforward registration process.
• Choosing the right business structure and meeting legal requirements are key to successful incorporation.
• Ongoing compliance, including annual reporting, is necessary to maintain the company’s legal standing in Singapore.

Advantages of a Singapore Offshore Company

• No paid in-capital
• Quick and easy registration process
• Offers extensive tax incentives
• Access to Double Taxation Treaties S
• Shelf companies and nominee services permitted
• Key financial hub in Asia Considered the Switzerland of Asia
• Strong banking and financial sectors
• International banks have branches or headquarters
• Strict legal and corporate laws
• Highly regarded jurisdiction
• Separate legal entity Great environment for entrepreneurs and SME's No taxation of any kind of foreign-sourced income
• Rated one of the easiest place to do business in the world
• Best business environment in Asia Pacific
• Global innovation #5 in the world according to Economist Intelligence Unit
• Rule of law is respected
• Economic freedom index rated #1 in Asia #1 in achieving human capital Global Innovation Index 2018
• Has been rated as one of the worlds most competitive economies
• #3 in the world for best Intellectual Property (IP) protection: Global Competitiveness Report 2018
• One of the least corrupt governments and economies in the world

Top Uses

• Offshore Savings
• International Holding Company
• Financial Corporation
• E-Commerce Business
• Investment structure for access to other Asian developing economies

Foreigners Doing Business in Singapore

Incorporating a business in Singapore as a foreign entity necessitates an understanding of the local corporate structures and the associated regulatory landscape. Foreigners can set up several types of entities, including:

• Private Limited Company (Pte. Ltd.): Preferred for its limited liability and potential tax benefits.
• Branch Office: An extension of the foreign parent company, not a separate legal entity.
• Representative Office: Suitable for market research and feasibility studies, cannot engage in commercial profit-making activities.
• Limited Liability Partnership (LLP): Combines the features of partnerships with those of companies.

Foreign ownership is 100% allowed in Private Limited Companies, making it a compelling option for foreigners wishing to do business in Singapore.

Legal & Regulatory Framework

Singapore's legal framework for business formation is recognized for its efficiency and robust nature. Key aspects include adherence to the regulations set by the Accounting and Corporate Regulatory Authority (ACRA) and compliance with the Companies Act.

Legal System and Regulations

Singapore operates under a legal system that is well-developed and provides a conducive environment for businesses. The Accounting and Corporate Regulatory Authority (ACRA) is the central regulator overseeing business entities in Singapore. ACRA's role is to ensure a strict and consistent application of business laws and to provide a transparent regulatory environment. The legal system's adaptability and responsiveness to global business trends contribute to Singapore's status as a leading financial and business center.

The Singapore Companies Act

The cornerstone of corporate governance in Singapore is the Companies Act, which establishes the legal framework for company formation, operation, and dissolution. It outlines specific requirements for companies, including the need for a registered office, at least one resident director, and the appointment of a qualified company secretary. The Companies Act also specifies how the interactions between various stakeholders, such as shareholders, directors, and creditors, should be managed, creating a stable environment for corporate activities.

Compliance Requirements

Singaporean companies must adhere to various compliance requirements post-registration to maintain their status in good standing. These include:

• Annual Filing: Companies must file annual returns with ACRA and annual tax returns with the Inland Revenue Authority of Singapore (IRAS).
• Registered Office: Each company must have a registered office physically located in Singapore, which is accessible to the public during normal office hours.
• General Meetings: Companies are required to hold Annual General Meetings (AGM), where financial statements are presented to the shareholders.

Additional regulations may apply depending on the specific industry and activities of the company. These compliance aspects underscore Singapore’s commitment to fostering a transparent and regulatory-compliant business landscape.

The Company Formation Process

The formation of a company in Singapore is a structured and systematic process, consisting of selecting a suitable business entity, registering the company with the Accounting and Corporate Regulatory Authority (ACRA), and attending to post-incorporation procedures to ensure compliance and good standing.

Choosing a Business Entity Type

When forming a company in Singapore, it is crucial to determine the appropriate type of business entity as this decision impacts taxation, liability, and compliance requirements. The options include private limited companies, sole proprietorships, and partnerships, with the private limited company being the most common due to limited liability and credibility.

Registration with ACRA

The incorporation process involves registering with ACRA, which is the national regulator of business entities and public accountants in Singapore. Registration steps generally include:

1. Ensuring that the company name is unique and approved by ACRA prior to registration.
2. Preparing necessary incorporation documents, such as the company constitution.
3. Making payment of the registration fee to ACRA following the submission of the required documents.

A successful registration results in the issuance of a certificate of incorporation and a business profile from ACRA.

Opening a Business Bank Account

For any business in Singapore, opening a business bank account is a fundamental step towards ensuring financial transactions are processed effectively and securely. To open an account, the company needs to provide a set of documents, typically including but not limited to the Company’s business profile from the Accounting and Corporate Regulatory Authority (ACRA), identification papers of the directors, and proof of the company's address.

Banks in Singapore offer a variety of bank accounts tailored to meet different business needs, including multi-currency accounts, internet banking, trade financing, and merchant services. Companies should compare the different features and select a bank that aligns with their business requirements.

Key Corporate Features

*AUDIT AND FINANCIAL RETURNS For companies with annual turnover over SGD 5 million, annual audited accounts are required to be filed by a qualified Singapore auditor and filed with the Singapore Registry. However, companies are exempt if they have less than 20 members, are individuals and not corporations and have a turnover of less than SGD 5 million

**TAXATION Exempt companies receive 0% taxation on all foreign-sourced income or if taxes have already been levied and paid in another jurisdiction. Assets are only taxed if no taxes have been levied on the assets and only when it is repatriated into Singapore. Passive foreign income stored in a holding company for example is not taxed.

Package Includes

1. Government Registration Fee (First year)
2. Registered Office Address (First year)
3. Registered Agent Services (First year)
4. Company Secretarial Maintenance
5. Certificate of Organisation
6. Articles of Organisation
7. Minutes of First Organisers Meeting
8. Ownership Certificates
9. Register of Members
10. FREE Phone and/or email consultations

Corporate Taxation 

Singapore Private Limited Companies enjoy attractive tax exemptions and incentives. Singapore has a territorial-based taxes system.

For non-resident companies that have there income coming from foreign sources are between 9-17% with a number of exemptions for startups, for small businesses and for certain sectors.

Singapore’s corporate tax framework implements a territorial based system, where income generated within the country and income remitted or deemed remitted into Singapore is subject to taxation. The corporate income tax rate is a flat 17%, which is relatively low compared to global standards. The country adopted a single-tier corporate income tax system in 2003, meaning that the tax paid by a company on its chargeable income is final and dividends distributed to shareholders are tax-free.

Tax Exemptions and Incentives

Singapore offers a range of tax exemptions and incentives to support companies, especially startups and small to medium enterprises (SMEs).

• Tax Exemption Scheme for Startups (SUTE):

  • For qualifying startups, there is a 75% tax exemption on the first SGD 100,000 of chargeable income.
  • A 50% exemption applies to the next SGD 100,000.

• Partial Tax Exemption:

  • All other companies can benefit from a 50% tax exemption on the first SGD 100,000 of chargeable income.

• Financial Sector Incentive (FSI) scheme: This is specifically designed for companies in the financial services sector, providing tax allowances or reduced tax rates on qualified income.

• Cap on Transaction Costs: Companies can enjoy a 200% tax allowance on transaction costs, capped at SGD 100,000 per year of assessment, for qualifying deals.

This system of exemptions and incentives underscores Singapore's reputation as a business-friendly environment, aiming to stimulate investment and foster economic development.

Corporate Details

Anonymity, Confidentiality and Disclosure

All names and details of Directors, Shareholders, and Beneficial must be publicly available. Accounts must be filed and is made public. However, a Singapore company can used nominee services if an owner wishes to remain confidential.

Company Shares

A Singapore Company offers the ability to have many different types of shares, however, one can not use bearer shares and no par value shares.

Required Capital

The usual authorized capital is SGD 1,000. The minimum capital requirement needed to establish a Singapore Company is SGD 1.

Financial Statements required

Financial statements are required for all Singapore corporations.

Directors

One Director is required for a Singapore company. There must be one local resident Director though the local director can be given limited powers so that you the owner can be instituted with power of management as the beneficial owner and Director. Corporate shareholders are not allowed.

Company Secretary

A company secretary is required who must be a person and a resident of Singapore.

Company Meetings

Company meetings are required but they can take place anywhere in the world.

Principal Corporate Legislation

There is one corporate legislation that covers all Singapore companies, for both onshore and offshore companies and is the Singapore Companies Act, Chapter 50.

Type of Law

Singapore is based on a Common Law system.

Shareholders

A Singapore Private Limited Company requires there be a minimum of 1 shareholder. The shareholder can be an individual or a corporate body. 

Trading Restrictions

A Singapore company has restrictions on doing business within certain financial and business industries that require a license. If a company does business within the jurisdiction then it must pay local corporate taxes.

Exchange Controls

There are no exchange controls in Singapore

Powers of the Company

A Singapore Private Limited Company has all of the same rights and privileges as a legal person

Audit Requirements

A Company may be free of any audit requirements if it meets these conditions:

For companies with annual turnover over SGD 5 million, annual audited accounts are required to be filed by a qualified Singapore auditor and filed with the Singapore Registry. However, companies are exempt if they have less than 20 members, are individuals and not corporations and have a turnover of less than SGD 5 million 

Annual Reporting

A company must annually submit its accounts to the Singapore Register

Shelf Companies available

Yes Shelf Companies are available

Time required to form an offshore company

5 Business Days

Name Restrictions

A company must not use a name that is already in use that is identical or similar to a name already used by another company. A company should not use the word 'bank' or 'education' or use any words that are considered offensive.

Names of Company requiring a special licence or permission

A Company must seek prior approval or licence if its company name uses the word bank, building society, insurance, assurance, investment, trust, trustee, or finance etc…

Government Tax

SGD 300

Frequently Asked Questions

How much does it cost to set up a company in Singapore?

The cost to set up a company in Singapore mainly depends on the type of business structure chosen. Registering a sole proprietorship is generally the least expensive option, while a private limited company involves ACRA registration fees totaling S$315. Additional costs may be incurred if engaging company formation services.

Can a foreigner set up a company in Singapore?

Foreigners are allowed to set up a company in Singapore. However, they must recruit a registered filing agent in Singapore to facilitate the registration process, as they are not permitted to register a company on their own.

What are the requirements to set up a company in Singapore?

The fundamental requirements for setting up a company in Singapore include at least one shareholder, a local resident director, a company secretary, a local registered address, and an initial paid-up capital of at least S$1. The entire process can be completed online, and the business must be registered with the Accounting and Corporate Regulatory Authority (ACRA).

What is the equivalent of an LLC in Singapore?

The equivalent of a Limited Liability Company (LLC) in Singapore is called a private company limited by shares, or more commonly a private limited company. This type of company structure is the most common for small to medium-sized businesses and it offers limited liability to its shareholders.

How to register a company with ACRA in Singapore?

To register a company with ACRA in Singapore, one must submit an online application through BizFile+, ACRA’s electronic filing and information retrieval system. Required documents include the company name, description of business activities, details of the shareholders and directors, and a registered address in Singapore.

What are the fees associated with incorporating a company in Singapore?

Incorporating a company in Singapore involves a fee of S$15 for name approval and a S$300 registration fee, bringing the total payable to ACRA to S$315. There can be additional costs for professional services if assistance from company formation agents or secretarial services is utilized.

Forming a company in Singapore offers numerous advantages for international businesses. For expert assistance navigating the incorporation process and ongoing compliance requirements, Offshore Protection provides comprehensive Singapore company formation services tailored to your specific needs.

Singapore Private Limited Company Incorporation with Offshore Protection

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