How to Set up a Company in Singapore

How did Singapore become so successful?

Singapore is one of the world’s leading financial and business centers, a status achieved through careful planning.

After gaining independence from Malaysia in 1965, Singapore needed to find a way to sustain and ultimately prosper as a small nation with limited natural resources. The solution was to develop the country into an open and internationally focused financial hub.

This strategy proved to be highly successful, and today, Singapore ranks among the most prosperous countries in the world, consistently placing in the top five for GDP per capita.

What are the advantages of incorporating in Singapore?

Singapore is a major business and investment center, equipped with world-class business and banking infrastructure. The country operates under a strong rule of law based on British common law, a legacy from its time as a British colony.

As a respected international jurisdiction, Singapore boasts a politically stable system that places a high value on integrity, attracting investment from across the globe. This makes it a highly trusted location for conducting business and managing finances.

Alongside Hong Kong, Singapore is a preferred choice for affluent individuals looking to establish themselves in Asia. The country consistently ranks highly in surveys assessing the ease of doing business.

What are the tax benefits of setting up a company in Singapore?

Singapore has a corporate tax rate of 17%. However, profits up to SGD 200,000 are taxed at half of this rate. Additionally, there are generous tax exemptions and concessions available for startups.

There is no capital gains tax in Singapore, and dividends received by shareholders are tax-free. Singapore employs a territorial-based tax system, which means that foreign source income is generally not subject to taxation.

Whether you are using Singapore for business or investment purposes, it can be an excellent way to access world-class investment opportunities while keeping tax liabilities low, or even at zero, if structured appropriately.

International tax planning is complex. The information provided here is general in nature only. If you would like to discuss taxation specific to your situation, please book a call.

Can a foreigner set up a company in Singapore?

Singapore is regarded as a business-friendly and internationally focused country and it allows 100% foreign ownership of a company.

What else is required to incorporate in Singapore?

To establish a company in Singapore, you need to have a resident director. This resident director can be a Singaporean citizen, a permanent resident, an Employment Pass (EP) holder, or an Entrepreneur Pass (EntrePass) holder.

If you do not plan to reside in Singapore yourself, you can appoint a nominee director to fulfill this requirement. Please contact us if you are interested in our nominee director services.

Additionally, you will need to have a resident company secretary for your Singapore company.

There is no minimum number of shareholders required, so it is possible to have a company with just one person. The minimum share capital required to register a company in Singapore is S$1.

Can I get a work permit to live in Singapore?

It is possible for foreigners to establish a company in Singapore and have that company sponsor themselves for a permit to reside in the country. This is typically done through an Employment Pass (EP).

The EP allows visa holders to obtain a residence permit valid for two years. There are additional requirements, such as the necessity to pay the EP holder a minimum salary level.

To successfully secure an Employment Pass, the company will be assessed under a points-based system known as the Complementary Assessment (Compass) Framework. The Compass framework consists of four categories: High Salary; Qualification; Diversity; Local Employment.

Next steps

If you are interested in learning more about setting up a company in Singapore and how it can be utilized in an offshore business plan, please get in touch.

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