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7 Jul

SETTING UP BUSINESS IN SINGAPORE

Setting Up Business in Singapore

Business firms can be sole proprietorships or partnerships. Any individual may start his own business by registering with the Registrar under the Business Registration Act. Up to a maximum of 20 persons may operate a business as a partnership. A partnership must also be registered with the Registrar. Sole proprietorships and partnerships are not corporate bodies. Sole proprietorships and partnerships do not need to submit their annual accounts but they must renew their registration every three years. Some businesses such as banks, manufacturing of cigarettes, optical discs require special licenses.

Companies may be registered as branches of foreign companies, private limited or public companies. Any two or more persons may form an incorporated company by registering under the Companies Act. A company may be limited by share, limited by guarantee or unlimited.

For private limited companies, the number of shareholders is limited to a maximum of 50. Public companies may have more than 50 members and they can raise capital by offering shares and debentures to the public.

A public company must register a prospectus with the Registrar before making any public offer of shares and debentures.

The term, “Foreign Companies”, refers to companies incorporated outside Singapore and such companies wishing to set up a branch in Singapore must be registered as foreign companies under the Companies Act.

If you represent a foreign company and wish to only set up a representative office (RO). You would need to register your representative office with International Enterprise Singapore (IE Singapore). IE Singapore registers representative offices from the manufacturing, trading, trade logistics and trade-related services sectors for a nominal fee of S$200. Setting up a representative office is a good way of exploring business opportunities in Singapore or in the region.

Representative offices can only undertake promotional and trade liaison activities on behalf of its parent company. The representative office cannot conclude any contracts or even provide consultancy for a fee, undertake transshipment of goods, open or negotiate any letters or credit. More details information is listed below.

Representative Office In Singapore

Here are the steps and guidelines on how a foreign firm can set up a Representative Office in Singapore.

Representative Offices in banking, finance, insurance and legal industries – To set up, you need to register with the Monetary Authority of Singapore (MAS). More details can be found at:  www.mas.gov.sg.

You will need to meet the guidelines and criteria set out by MAS.

Representative Offices in all other industries – To set up, you need to register with International Enterprise (IE) Singapore. More details can be found at: www.iesingapore.gov.sg.

Your Representative Offices can only carry out the following activities:

  • Market research
  • Feasibility studies
  • Liaison work on behalf of parent company

Your Representative Offices cannot conduct any of the following activities (directly or on behalf of the parent company):

  • Trade in goods or services (including import or export)
  • Lease warehousing facilities
  • Lease office to other establishments for a fee
  • Conclude business contracts
  • Issue invoices and receipts
  • Issue and receive letters of credit
  • Provide services for fees

If you wish to ship, transship or store goods in Singapore, you should get your parent company to appoint a local agent or distributor. You cannot use your RO to carry out these activities.

If you wish to carry on operations in Singapore, you should register a branch office or incorporate a company with ACRA.

Steps to setup a Business

1. You have to first apply for a name for the business. There is a fee of S$15 per application. The proposed name must not be currently in use by any other company or business firm.

2. To apply, you must submit Form A, “Application for Approval of a Business Name”, which is obtainable free of charge from Registry of Companies and Businesses or from its homepage at www.acra.gov.sg. You may also ask for the forms to be sent to you at (65) 1800 222 6266.

3. From 1 January 1994, self-employed persons are required to top-up their Medisave account with the CPF Board before they register or renew or become the owner of a business.

4. Food, liquor, music and entertainment businesses also require licences from the Ministry of Environment, Liquors Licensing Board and Public Entertainment Licensing Unit respectively.

5. The Technopreneur Home Office Scheme allows entrepreneurs to use their homes, both private residential and HDB property, as offices for their start-up businesses, subject to approval from the Economic Development Board. The business should be infocomm technology focused and in sectors which have been earmarked as high-growth, export-oriented and intellectual-property based (e.g. information technology, design of integrated circuits, internet software, etc.). The start-up must also be an unlisted company registered in Singapore. Foreigners, subject to the approval of Singapore Immigration and Registration and the Economic Development Board may also extend their Long Term Social Visit Pass in Singapore for up to a year for them to seed their business operations.

Tax and CPF Contributions

Under Singapore tax laws, tax is chargeable on the income of any person (including a company) accruing in or derived from Singapore or received in Singapore from outside Singapore. A company means any company incorporated or registered under any law in force in Singapore or elsewhere. Contact the Inland Revenue Authority of Singapore for more information.

If you employ staff, you need to contribute to the Central Provident Fund (CPF) for your employees. For more details, please contact CPF Board.

Self-employed persons who have registered businesses as sole proprietorships need to contribute to their Medisave accounts with the CPF before they can renew their business registration. The amount payable is computed by the CPF based on their business earnings.

The Registry of Companies and Businesses has produced a guide titled “A Good Start”. It contains comprehensive information on setting up a business in Singapore and is obtainable from leading bookstores at S$15.

For more information on the following, please contact:

CPF Contribution/Medisave
CPF Board
79 Robinson Road
CPF Building, Singapore 068897
Tel : (65) 1800 226 3877
Fax : (65) 6229 3880 / 6229 3881 / 6258 2778
Email : cpfboard@cpf.gov.sg
Website : www.cpf.gov.sg

Personal, Corporate and Business Taxation
Inland Revenue Authority of Singapore
55 Newton Road, #23-00
Revenue House, Singapore 307987
Tel : (65)-1800-6356 8300
Website: www.iras.gov.sg

Businesses Serving Liquor on its Premises
Customs & Excise Department
Liquors Licensing Board
55 Newton Road, #02-01 Podium Block
Revenue House, Singapore 307987
Tel : (65) 6272 8222
Fax : (65) 6250 8663
Email : ced_controls@ced.gov.sg
Website : www.customs.gov.sg

Food Businesses
Food Control Department
Ministry of Environment
5 Maxwell Road, #18-00 Tower Block,
MND Complex, Singapore 069110
Tel : (65) 6325 2579
Fax : (65) 6324 4563
Email : contact_env@env.gov.sg
Website : www.env.gov.sg

Music and Entertainment Businesses
Licensing Unit
Police Cantonment Complex
391 New Bridge Road
Block B, #02-701
Singapore 088762
Tel : (65) 6835 0000
Fax: (65) 6226 2254

Registry of Companies and Businesses
10 Anson Road, #05-01/15
International Plaza, Singapore 079903
Tel : (65) 6248 6028
Fax : (65) 6225 1676
Website : www.acra.gov.sg