Starting a business in Singapore is an endeavor with desirable fruit. You can capitalize on one of the world’s most vibrant economies. Low taxes, a pro-business environment, and excellent infrastructure make businesses viable. Its strong ties with other countries in Asia make it profitable for those who can meet the requirements.
Additionally, numerous incentives available for foreign businesses make it even more attractive as an investment destination. For instance, a new company setup can qualify for corporate tax exemption. You can be sure that setting up your company in Singapore will be smooth. But ensure you have the necessary qualifications and follow the set procedure.
Here are the steps you take to start your company in Singapore.
1. Understand the Requirements and Regulations
You are already set with your best idea to bring solutions to customers. Your innovations are ready. But understand the local laws and regulations before starting your business. Various government regulations apply. And these laws can vary according to business type and ownership. For instance, sole proprietorships do not need to meet the compliance set for incorporated companies.
But generally, company formation Singapore requires you to meet the minimum capital base, register with the Singapore company registrar, set up a business bank account, and record all transactions. Also, most types of businesses must register with the Accounting and Corporate Regulatory Authority (ACRA). The body issues a unique business registration number you will use to identify your business.
That is not all. All businesses intending to employ workers must adhere to the employment rules set out in the country. That ensures you avoid breaking employment regulations. Refer to government resources to identify laws that apply to you.
2. Decide Your Company Structure
Not all businesses are equal. Your capital dictates the type of company or business level to start. You cannot set up a PLC if you have only S$2000. Also, available partners and investors will influence your mode of company formation. The structure you choose dictates the regulations and tax requirements you must meet.
For instance, setting up a private limited company differs from setting up a sole proprietorship or a partnership. PLCs require more capital and compliance than other structures and provide more protection to investors. Also, foreign investors must meet specific requirements. You cannot set up a company in Singapore without at least one local shareholder and director.
Additionally, the business scope will determine your rights, liabilities, and responsibilities. Ensure you understand the implications of each business structure before settling for one. A sole proprietor will have total control over the assets and profits. But the owner will be liable for business debts.
3. Register Your Company with ACRA
Business registration is mandatory for all companies, even if it is a sole proprietorship. ACRA will issue you a unique business registration number that identifies your company. You will use the number in all filings and transactions. But you must first submit all the necessary details about your investment. Each business model has distinctive requirements.
Sole proprietors only need their business name approved and complete the registration form. You can request the name on the ACRA’s Bizfile portal. Companies require a memorandum of understanding, minutes, articles of association, and other paperwork. You should consult a legal representative to help you draw the documentation.
4. Open a Corporate Banking Account
Paying and filing tax returns are part of regular business transactions. You must use your business bank account to complete the transactions. It also applies to paying your employees. The money must come from the corporate account. Therefore, decide how to open and manage it for safer transactions and customer payments.
The banks in Singapore have varying requirements for corporate accounts. Ensure you meet them all. You will use your business registration number and other documents to prove ownership. Ask different banks about the terms and requirements for setting up the account. You can use a local or international bank to manage your corporate funds.
5. Insure Your Business
Singapore business operators need insurance to protect their investments and employees. The Worker Initiative Compensation Act requires that all employers take out insurance for their workers. The cover protects them from workplace-related injuries and illnesses. Companies must get all their workers into the program – including foreign employees. And this cover is mandatory for non-manual work employees earning below $1,600.
Protecting your business also means taking out liabilities and other insurance covers. Your insurance provider must assess the risks associated with your business to determine the best solutions for you. Averagely, companies spend 1-3% of their revenue on insurance policies. Consider your industry and budget before signing any contracts.
6. Acquire a Legal Representative
How do you intend to handle cases at your company when you start operations? It will not be wise to wait until you face a problem to find a legal entity to represent you. Choose a team of legal representatives to help in different areas, such as contracts, business operations, and taxation.
Also, your business will need legal advice and representation when engaging your insurer and creditors. The legal team should deeply know Singapore’s laws to avoid mishaps. Ensure you hire a reliable representative for better service. For instance, a lawyer specializing in corporate law will be an ideal representative for company owners.
7. Complete Other Administrative Tasks
Your next step after setting up the business and getting everything ready is operations. But wait. Who is going to work at your business? Do you have any employees? Ensure you hire competent personnel to manage different sectors of the company. For instance, you may need an accountant, a marketing expert, and front desk personnel.
Also, create an online presence for your business to reach a wider audience. Build a website and register your company on popular online directories and social media platforms. That will make your marketing more affordable and efficient. Never forget to collect feedback and use it to improve your services.
Establishing a company in Singapore is wise when you have the spirit of entrepreneurship. Understand the legal requirements and procedures to make your operations legal. Also, decide how to finance the business and open a corporate banking account. Remember the mandatory step of insuring your company. Add a professional legal team and other personnel to complete the process. Finally, create an online presence for your business to reach more customers.