Many may have already known that Singapore is one of the best business centers in the world, being ranked at the second place by World Bank for ease of doing business in 2018. Abundant business potential is available in Singapore, even for foreigners. Business legislation in Singapore allows foreign investors to have 100% foreign ownership of the company in the country. A few advantages of setting up a company in Singapore is that the country has favorable tax regulations that are considerably low, and there is zero restriction on repatriation of earnings and capital.
A Singapore subsidiary company is a private limited company that is set in Singapore. Commonly, small to medium-sized foreign companies prefer this company registration in the country. Full ownership of the subsidiary company by a foreigner is permitted by law. The Singaporean law views a subsidiary company as a separate entity from its foreign parent company and it is treated as a local business entity of the country. Therefore, the liability and debts of the subsidiary company are also considered
Even though the parent company can own 100% share of the subsidiary company, there must be at least one director in the subsidiary who is a Singaporean citizen or a Singaporean permanent resident, or someone with an Employment pass. The minimum age of the director is 18 and doesn’t have a bankruptcy history nor criminal record. Employment pass is needed for staffs from the origin country that are to be placed in Singapore and can be applied after the company has been successfully registered. There is a minimum paid-up capital of S$1 for a Singapore subsidiary company. The company must also register a local office addressed in Singapore whether it is a commercial office or a home office. Aside from the director, the subsidiary needs a secretary that is native to the country. Within three months from the registration date of the company, an auditor must be appointed.
Non-Singaporean companies who are expand their business in Singapore as a subsidiary company must use the service of a professional firm to help them in registering their company. The registration does not require a long time and is possible to be done online. Two registration procedures are name approval and company incorporation. Approximately 1-2 days is the time for the registration to be completed.
The tax regulation applies the same to a Singapore subsidiary where the corporate tax rate is 17%. There are certain cases where companies may use subsidiaries for tax efficiency strategies, such as holding companies that are able to establish subsidiaries in Singapore to own shares that will not be levied withholding taxes. If unsure, it is best to consult an accounting service that is capable of serve proper guidelines regarding taxation of the subsidiary.
Company Law of Singapore states that all companies including subsidiary are obliged to file an Estimated Chargeable Income (ECI) three months prior to the end of the financial year. Companies must also hold a general meeting each year with shareholders for business financial status discussion. In result, within one month after the meeting, the company is required to file an annual return with the Inland Revenue Services. If all rules and requirements for foreign business in Singapore is followed and fulfilled, there should be no problem for businessmen from outside of the country to establish their company here. If you need help to set up your company in Singapore you can get the detail via this website, https://www.a1corp.com.sg/
