What’s Next After Incorporating A Company In Singapore?
If you are a business enthusiast looking out for exploring opportunities in Singaporean markets or a foreign company wishing to expand the business with the help of a subsidiary company in the country? Then, you should be well acquainted with all the vital information concerning incorporating a company in Singapore and subsequent steps post the incorporation of the company.
After registering your company there are certain formalities That one needs to complete. The Singapore registration process is easy and comprehensive. It does not involve lots of documentation and tedious procedures. Once you have completed the Singapore registration process one must follow certain procedures to commence the business activities.
Apply for Business Licenses:
A business license is a must to operate your business in Singapore. The Singapore government agency provides a business license to a company that allows one to successfully conduct their business operations in Singapore. However, Not all business types require a Singapore business license to operate their business, certain business types are not required to get the business license. Some of them include a retail shop, hotel restaurants, spa, trading companies, medical clinic, travel agency, etc. One can seek help from a professional company offering incorporation service in Singapore to know if it is mandatory to obtain a business license to function their business.
Opening a Bank Account:
One of the most important steps that one needs to successfully complete while incorporating a company in Singapore is opening a bank account in the country. A business organization must open a corporate account in one of the leading and accredited banks and financial institutions to make any transaction for Singapore Company.
Appoint a Company Secretary:
As per the Singapore Companies Act, it is compulsory for all Singapore companies to appoint a company secretary within the 6 months of its incorporation in Singapore. A company secretary plays a significant role in ensuring that all the documentation complies with Singapore regulations. They have the fiduciary responsibility to keep shareholders, directors and partners of the company acquaint with annual filing and scheduling AGMs too.
Registration for the Central Provident Fund (CPF):
If you are willing to appoint staff and employees in your Singapore Company then one must apply for registration for the Central Provident Fund (CPF). As per the Singapore laws it is required to contribute CPF if the monthly salary of an employee is more than $50 per month. CPF contributions apply to Singapore citizens and Singapore Permanent residents working on a contract basis, full-time, permanent or casual basis.
Registration for SDL:
As per the SDL (Skill Development Levy) employers are required to pay a monthly SDL for rendering professional services in the country. This is applicable for foreign employees, temporary employees as well as casual employees. However, domestic servants such as gardeners, chauffeurs, gardeners, etc are exempted from SDL. SDL is payable 0.25% of the monthly income of an employee. The minimum payable as per SDL act is $2 whereas the maximum SDL payable is $11.25 for employees earning more than $4500.
The above-mentioned points help one to understand further steps that one needs to take post the incorporation of the company. Hiring a professional having considerable knowledge of company incorporation service in Singapore can assist you to meticulously form and operate a business in Singapore.
The Accounting and Corporate Regulatory Authority has initiated an extensive review of the country’s corporate laws and regulatory framework. The Companies Act Working Group has recommended certain legislative reforms for incorporating a company in Singapore to make the future working process easy for the firms. To know more, read the following points on Company incorporation in Singapore.
Dematerialisation Of Share Certificates
Currently, a company is required to issue physical share certificates to shareholders within thirty days of the transfer of shares, and sixty days of the allotment of new shares. The CAWG has recommended ending the requirement to provide physical share certificates. This is because the ACRA records the Electronic Register of Members of private limited companies. If the recommendation comes into action, then the companies will no longer be required to issue paper certificates.
CAWG has recommended amendments to permit general meetings and board meetings of a company to be held digitally. Presently, the Companies Act provides for such meetings but does not specify how they are to be held. A few provisions state that the general meetings must be held physically. The objective of the recommendation is to remove any current ambiguity and give companies a clear understanding that digital meetings can be equally valid if conducted according to the provisions of the Constitution. It also aims to benefit incorporated companies by saving time and costs of travel.
Digitisation Of Documents
The CAWG has recommended amendments pertaining to digitisation. It would make it mandatory for companies to accept proxy instructions by electronic means, and permit for a wider scope of documents sent to members, officers, or auditors to be transmitted electronically. The objective is to avoid the need to deliver paper proxy forms and documents physically to a company to save time and costs of preparation, reviewing, and execution of the documents.
Establishment of New Types of Companies
The CAWG has put forth a proposal to introduce two types of companies, i.e., micro company and a publicly accountable company. A micro company fulfils the requirements for total annual revenue and total assets, each being not more than S$500,000 for the previous two consecutive financial years. A publicly accountable company is a financial institution company limited by guarantee registered under the Charities Act that is listed or is in the process of issuing its securities for the purposes of trading on a securities exchange.
Revised Financial Reporting Obligations
Presently, incorporating a company in Singapore seeks the financial statements that abide by the Singapore Financial Reporting Standards. However, the proposal allows a non-publicly accountable micro company to prepare reduced financial statements consisting of the Statement of Comprehensive Income, Statement of Financial Position, and Specific key disclosures.
The updates on Singapore incorporation aims to bring in improvements in compliance legislation, in particular those arising in response to COVID-19. The amendment process for the Companies Act has passed the public consultation stage. Moreover, the proposals are subject to further speculation and refinements. Look for a professional company incorporation service provider in Singapore to help you in settling down your business.
Related Read: Requirements of a Singapore Company
With favorable geographical locations, Singapore is one of the best countries to expand your business. However, the norms and regulations for company incorporation in Singapore are very different. Several factors come to play before incorporating a business in Singapore.
There are many leading company incorporation service providers in Singapore. But before stepping into the business world of Singapore and hiring any consultancy firm, one must have detailed knowledge as to how to invest and how to set up the business to get the maximum profit.
Types of Business Entities in Singapore
All the decisions needed to make for incorporating a company in Singapore, the most difficult is to choose the type of business structure.
- Sole Proprietorship
Businesses owned by one individual fall under sole proprietorship. The owner is fully responsible for the profit or losses that the company may incur.
- Company or Limited Liability Company (LLC)
The company incorporated under the ownership of two to twenty partners falls under this section. The Singapore incorporation law and regulation provide a separate legal entity to the company that is aloof from its owners. This means that the risks, debts are made in the name of the company and not the individual owners.
A Company Incorporated in Singapore Mainly Undertakes the Following Partnerships:
- Limited Partnership
This type of corporation has one general partner and one limited partner. The general owner can either be an individual or a corporation who is accountable for all the debts incurred during his period as the general partner. As for the limited partner, he is liable up to a certain limit as mentioned in the signing contract of the partnership.
- Limited Liability Partnership
Two partners are liable for the debts incurred by the company based on the amount invested. They are not liable for the debts incurred by other partners. An advantage for this option, limited liability partnership reduces the risk of personal loss.
Which Business Entity To Choose?
As the differences have been established, now comes the question of which one entity to choose. The answer lies in your situation and plans.
- You should be aware as to how much capital you are willing to invest
- Will you opt for single ownership or do you want partners?
- Are you willing to take limited or unlimited liabilities?
- What are the advantages and disadvantages of the various business structures?
How To Set Up A Company In Singapore?
Foreign companies must abide by the Singapore company incorporation norms to expand or set up their business here.
- The owner of the business must be at least 18 years old.
- Any business entity must have one representative residing in Singapore.
- A foreigner can apply for an Employment Pass under the new entity.
- The owner must also provide other documents as when required for the registration.
- After the registration, one must comply with the post-registration processes.
Contact the best company incorporation service providers in Singapore to get the best possible solutions and guidance on company incorporation in Singapore.