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Advantages of Incorporating a Private Limited Company in Singapore

“Globalization has changed us into a company that searches the world, not just to sell or to source, but to find intellectual capital - the world’s best talents and greatest ideas”
– Jack Welch
A properly structured Singapore Company (Pte Ltd/Private Limited) is an excellent, tax efficient corporate conduit, through which international business can be conducted, with the following benefits:

Reputation and Credibility

Any Singapore incorporated company has excellent credibility and international status, thanks to Singapore’s prestigious national branding. This lays an outstanding foundation for promotion of your company to customers, suppliers and investors and opens doors to business alliance opportunities.

Such an incorporation is perceived to have long range plans for your business and would increase your profits and ability to expand. It will not be perceived as an ‘Offshore Company’ in a ‘Tax Haven’. It is a legitimate corporate vehicle domiciled in a reputable, politically stable, international trading jurisdiction that has a complex infrastructure and a well-regulated economy.

Banking advantages

A Singapore company’s ‘above board’ reputation facilitates hassle-free opening of corporate bank accounts in Singapore, and all over the world. Additionally, Singapore banks offer excellent Letters of Credit (LC) support to Singapore companies engaging in international trading.

Tax Benefits

  • Newly incorporated companies which are tax residents in Singapore (excluding investment holding companies) enjoy tax exemption for the first 3 years from the date of incorporation. For detailed information please refer to IRAS Corporate tax rates.
  • Legal Tax Minimization - International profits earned and kept offshore are not subject to local tax, provided certain conditions are met. Thus, a properly structured Singapore company can be a suitable entity for managing corporate taxation legally.
  • Singapore has formed Double Taxation Agreements, Limited Treaties, and EOI arrangements with a wide network of countries, including powerful economic nations such as the US, China, Japan, UK, Canada, France and Germany. The IRAS website provides a comprehensive list and details.
  • Simple tax filing - Companies are required to file an Estimate of Chargeable Income(ECI) within 3 months from Financial Year End (FYE), and Final tax returns FORM C/C-S, to be filed only by 30th November of the following calendar year.

Swift and Simple Incorporation Process

A Singapore company can be incorporated within 24 hours. It may very rarely take upto 3 weeks (if the company has foreign shareholding) and pending on proposed company name availability and compliance checks.

In accordance with the Singapore Companies Act, the only requirements to incorporate a Singapore company is that the company has at least one local director (Singaporean Citizen, Permanent Resident or EntrePass Holder) and a local company secretary, of at least 18 years in age without prior bankruptcy record. (Conveniently, a local Director may also double as the company secretary).

Singapore companies (with majority Singapore-based shareholding) are also eligible for a host of various Government grants available for assistance in branding, IT consultancy and systems improvement.

Limited Personal Liability

A Private Limited Company is a legal entity which the business is operated from. This means that it is the company that enters into a business transaction and is responsible for the outcome - not the shareholders and/or company officers. In case of a lawsuit or judgment against your business, no one can seize your personal assets, your home, cash, bank accounts etc. As a shareholder of the company, your exposure to loss is limited to the amount of your issued and paid-up capital in the company.

Centralised location in Asia Region

For the last three decades, Singapore has been at the heart of the Asian economic boom, maintaining a stable and viable economy. Centrally located, with a harmonious blend of cultures, Singapore is the ideal place for foreigners to forge a foothold in Asia and form a bridge between the east and west.

Logistically, Singapore is also one of the best locations for regional business travel, with Changi Airport renowned worldwide for its efficiency and frequency of flights.

Transparent Compliance Requirements

  • Annual Accounts* must be prepared and submitted to Inland Revenue Authority of Singapore (IRAS).
  • Financial year end (FYE) must be set within 12 months from date of incorporation. You may wish to consult us about setting the FYE date, to maximise your tax exemption benefits.
  • Audit exemption is applicable to Small Companies with effect from 1 July 2015 as per Singapore Companies Amendment Act 2014, if they meet certain criteria.
  • AGM must be held within 6 months of Financial year End (FYE), and Annual Returns must be filed with Accounting and Corporate Regulatory Authority (ACRA) with 7 months of FYE

For Example:

Date of incorporation 15 October 2019
Financial year end (FYE) 30th September 2020 (as deemed within 12 months of incorporation) 31st December 2019 (to align with tax year period January to December within the deemed period of 12 months from the date of incorporation)
Annual General Meeting (AGM) 31st March 2021 (must be held between 30th September 2020 and 31st March 2021 to stay within the statutory period of 6 months from FYE) 30th June 2020 (must be held between 31st December 2019 and 30th June 2020 to stay within the statutory period of 6 months from FYE)
Filing Annual Return 31st April 2021 (can be filed any time after AGM, but no later than 7 months from FYE) 31st July 2020 (can be filed any time after AGM, but no later than 7 months from FYE)

*Professional fees for the preparation of these accounts are proportionate to the income of the company.

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