“How to register company in Singapore for a foreigner?” This question is much sought answers by foreign entrepreneurs. Every single piece of useful information counts for them while they are making tough choices regarding the process of registering a company in Singapore. The good news is that the process of starting a business in Singapore for a foreigner is not difficult. Being a first-timer, you must take reliable advice from the registered filing agent.
Overview
How Can Foreigners Register Company in Singapore?
Like a local Singaporean, a foreigner can register a company and can own 100% shareholding without any problem. To put it simply, any person over the age of 18 years can start a new company in Singapore. Let’s take the case where he does not have any criminal or financial offense.
Apart from Singaporeans, Permanent Residents (PR), holders of Employment Pass, EntrePass, Dependents Pass can register the company and be its shareholders too. You do not need to be physically present in Singapore during the business registration process.
Key Requirements for Foreigners Register Company in Singapore
How to Appoint Local or Resident Director
A local person can act as a resident director while self-registering his or her company on the BizFile+ portal. The resolution of the company shareholders to elect the local director should be approved by them. One should select an individual who is above 18 years and who is of sound mind and body. An individual who has an undischarged bankruptcy cannot assume this role.
However, foreigners must:
- Appoint local director.
- Engage registered fling agent to register their company, as foreigners cannot self-register their company in Singapore.
Options for appointing a local director in Singapore include:
- Option 1: Hire a Singaporean citizen, Permanent Resident, or holder of an EntrePass as a local director.
- Option 2: Appoint a nominee director to represent your company.
- Option 3: Establish a company by obtaining an EntrePass beforehand.
**Sign a contract with the appointee stipulating their exclusion from company activities. They won’t be a bank signatory.
**Retain full control over the company and its corporate bank account.
Can an Employment Pass Holder Register Company in Singapore?
Certainly! Likewise, in Singapore, one is eligible to register a firm and have full ownership of its shares if one is the holder of an Employment Pass. Therefore, EP holders can run their own businesses and become entrepreneurs on the territory of our country. Nevertheless, there are distinct governance regulations that the executives and the directors must abide by.
Although, in many cases, EP holders can own a company, they cannot be appointed local directors of the company that they found. On the other hand, this would imply a foreign-owned company would not be able to meet the requirement that at least one director must be a Singaporean. Here the applicants need to choose the resident director or nominee director to comply with Singapore’s company law.
As per the regulations of Singapore, the resident director of the company should be a citizen of Singapore, a permanent resident of Singapore, or a holder of one of the following passes: EntrePass, Employment Pass, and Dependant’s Pass. This resident director is a key person in the process of supervising the company’s functioning and staying within legal bounds and local law and regulation requirements.
A professional firm or a company secretary is the usual choice for an EP holder who seeks to set up a company in Singapore. Their role is to help in the process of company incorporation. These companies can be catalysts for the provision of a local director, so the company can comply with the registration and operation requirements as stipulated by Singaporean law.
In short, EP holders can establish a company and own shares in Singapore but need to consider regulations related to directorship by appointing a resident director at the company registration process. Consulting with professionals like EMGC can make the incorporation process go more smoothly, and the firm can make sure that the company follows local laws and regulations.
Cost to Register Company in Singapore
In this aspect, non-residents or foreigners can not make a direct self-registered company in Singapore. However, they have to use the services of a registered filing agent to do this instead. The Accounting and Corporate Regulatory Authority (ACRA) administers this process and enforces specific fees as below:
- Company Name Application Fee: S$15 (This searches the company name and reserves it for 60 days, though additional payment will be required to extend).
- Company Registration Fee: S$300.
After completing everything, ACRA grants the incorporation email, which becomes the incorporation certificate in Singapore. ACRA issues certificates in a hard copy format that are then payable by the companies concerned.
Register Company in Singapore for Foreign Individuals
You should be mindful of only 2 steps to incorporate a company in Singapore.
A smart decision on business structure is the crucial point for the company incorporation in Singapore. It may also influence the structure of your business’ taxation.
The following types of businesses in Singapore can be registered by a foreign individual:
- Private Limited Company
- Sole Proprietorship
- Limited Liability Partnership
Private Limited Company (Pte Ltd)
The private limited company structure is highly preferred and recommended for business registration in Singapore.
- It can have 1-50 shareholders (owners).
- It requires at least one local director who is ordinarily resident in Singapore.
- A private limited company has a distinct legal identity from its owners.
- It possesses the rights of a natural person.
- It has perpetual existence.
- A Pte Ltd limits the liability of its shareholders to the amount they have invested in its shares.
- It is subject to corporate tax ranging from 0% to 17%.
The banks & financial institutions consider Pte Ltd more credible than a sole proprietorship or partnership. They can easily raise funds for expansion of their business activities.
Sole Proprietorship
A sole proprietorship, while not an incorporated company, functions as a business firm. We recommend this structure to clients when their business carries minimal risk.
- It lacks a distinct legal identity apart from its proprietor.
- The proprietor bears unlimited liability for debts and losses incurred.
- Income generated by a sole proprietorship is attributed to its owner.
- The owner is subject to personal income tax rates ranging from 0% to 22%.
Limited Liability Partnership (LLP)
According to Singapore Company Law, a partnership can be formed by two or more individuals and/or corporations.
- LLP possesses distinct legal existence apart from its owners.
- Owners’ liability is contingent upon their actions or negligence causing losses to the LLP.
- Partners are required to pay personal income tax (0%-22%) on their LLP earnings.
A limited liability partnership (LLP) have the advantages of both partnerships and companies, enabling partners to leverage their complementary skills and generate profits.
Singapore Company Registration for Foreign Companies
Registering a foreign company in Singapore presents a significant opportunity for SMEs worldwide. Depending on their business objectives, they can opt to establish a:
- Subsidiary Company
- Branch Office
- Representative Office
Subsidiary Company
Establishing a subsidiary company is highly advantageous for foreign corporations. It operates as a limited liability entity.
- The parent company retains 100% ownership of its shares.
- The subsidiary functions independently from its parent company.
- The parent company’s liability is confined to its share capital.
- The assets of the parent company are not utilized to cover the debts and losses of the subsidiary.
Upon establishment of the subsidiary company, the parent company must designate one of its employees to oversee operations in Singapore. This individual will require an Employment Pass to work in the country.
Branch Office
Foreign SMEs typically opt to establish a branch office in Singapore.
- Upon registration, a branch office becomes a distinct legal entity.
- It functions as an extension of its parent company.
- The parent company bears full responsibility for all debts and liabilities accrued by the branch office.
Additionally, the branch office must employ at least one Singaporean resident.
Representative Office
A foreign company has the option to establish a representative office in Singapore for market research purposes.
- To conduct feasibility studies and market analysis only
- The representative office does not possess a legal identity distinct from its foreign parent company.
- It is permitted to appoint a maximum of 5 employees.
- Engaging in profit-making activities is prohibited.
Furthermore, the parent company must be established for over 3 years, with an annual turnover exceeding S$250,000. If the parent company is dissolved, the representative office will be deregistered.
How EMGC Can Help?
EMGC is the leading company that makes the start of business in Singapore for foreigners easy and simple. Our range of services includes nominee directors, company secretary, and incorporation of the company. Trust us to take you through the process and make sure your business setup in Singapore complies with the local laws and at the same time you are not encountering any difficulties during that time.
FAQ
Is it possible for an EP holder to register company in Singapore?
Yes, as an EP holder, you can register company in Singapore just like any other individual. However, if you intend to also serve as its Singaporean local director, it’s important to gather additional information to avoid potential challenges and complications during the business setup process.
How can one open a corporate bank account in Singapore?
Opening a corporate bank account should occur post company registration but prior to business commencement, facilitating financial transactions. With over 127 banks in Singapore, select based on business needs. Required documents include those listed below.
• Completed and signed forms for corporate bank account opening
• Proof of residential address for stakeholders (directors, signatories, and ultimate beneficiary owners)
• Certified copy of the company’s Certificate of Incorporation
• Company’s business profile from ACRA
• Signed resolution by the Board of Directors and Signatories to open the account
• Certified copy of the company’s Memorandum and Articles of Association (M&A)
• Certified copies of Passport or SingPass
• Certificate of Incumbency & Certificate of Good Standing (for offshore accounts only)
What is the duration for registering a company in Singapore process?
Registering a company in Singapore is straightforward. With all the necessary incorporation documents ready, a typical business can be incorporated within one day. However, in practice, we typically register Singapore businesses within 1-3 days.
Is it possible for a foreigner to possess 100% equity ownership in a Singaporean company?
Both foreigners and individuals aged 18 and above, including locals, can effortlessly register their Singaporean companies.
Foreigners have the opportunity to own 100% equity shares in their companies, granting them full ownership rights. According to law, companies are recognized as legal entities with rights similar to those of natural persons. This implies that both local and foreign entities can register a Singaporean company as individuals. Parent companies can hold 100% equity or shareholding in the newly established company.
Foreigners can register company in Singapore without the need for immigration. However, they must appoint a local director initially. Subsequently, they can manage their company remotely from their home country.
Should they wish to establish their Singaporean company and serve as its local (resident) director, they must immigrate and obtain the appropriate work pass. Without the requisite work pass or visa, they are not authorized to work in Singapore.
Is it necessary to appoint a corporate secretary for my Singaporean company?
Certainly. It’s imperative to appoint a corporate secretary for your Singapore company within 6 months of its incorporation.
For public companies, the appointed secretary must be certified by a reputable institute. For private limited companies, ensure the appointee is qualified and experienced in accordance with the Company Act.
Secretaries play a vital role as officers of the company, facilitating communication with external entities and allowing company management to focus on their core tasks.
Who is eligible to incorporate and become a shareholder of a Singapore company?
Individuals aged 18 and above can establish a Singapore company and serve as its shareholder. As a shareholder, you have the authority to appoint a local director if required.
Is it possible for foreigners to serve as local directors of their own company?
Unlike Singapore citizens and permanent residents who can incorporate a company and serve as its local or resident director, foreigners require a work pass, such as the Entrepreneur Pass, to assume this role. This pass allows them to relocate and work in Singapore, and they can apply for it through the Ministry of Manpower.
Foreigners without a work pass have the option to appoint a nominee director, a Singapore resident, to act as the local director of their company. This appointment is crucial for completing the registration process, as at least one local director is required.
It’s important to note that being a shareholder (owner) of a company is distinct from working for it as a local director (employee). While holders of employment passes, dependent passes, and other types of passes can establish a company and be its shareholders, they must appoint a nominee director to fulfill the registration requirements. They are not eligible to act as resident directors or hold other positions within the company as employees.
What are the essential legal prerequisites for a foreigner to register company in Singapore?
As a shareholder, you have ownership of your company and can also serve as its local director, potentially receiving a salary. However, it’s important to distinguish between these roles. Alternatively, you can appoint a trusted friend or family member over 18 years old to act as the local director, responsible for tasks such as:
• Convening the Annual General Meeting.
• Submitting annual returns to the authorities.
• Obtaining a local registered address.
• Maintaining statutory registers, including those for members, directors, managers, secretaries, auditors, directors’ shareholdings, and charges.
• Passing resolutions for bank account opening.
• Appointing company officers such as directors, auditors, and company secretary.
• Ensuring corporate governance.
• Fulfilling corporate social responsibilities and implementing ethical practices.
• Liaise with government agency.
The age requirement for registering a Singapore company applies equally to both local and foreign entrepreneurs, requiring individuals to be at least 18 years old. Additionally, fulfilling the following criteria is necessary for a successful company setup:
• A minimum initial paid-up capital of S$1.
• At least one shareholder (up to a maximum of 50).
• At least one local (resident) director.
• At least one qualified company secretary.
• A registered local address for the company.
Ensure that you appoint a company secretary within six months of your company’s incorporation date. This is one of the fundamental requirements.
If I appoint my friend or family member as a local director, what are their responsibilities?
As a shareholder, you own your company and can serve as its local director, with the possibility of receiving a salary. Alternatively, you can appoint a friend or family member (over 18) as the local director, who must act in the company’s best interests. Their responsibilities include:
• Ensuring the company complies with statutory requirements
• Calling Annual General Meetings
• Filing annual returns with authorities
• Obtaining a local registered address
• Maintaining statutory registers
• Passing resolutions for bank account openings
• Appointing company officers
• Ensuring corporate governance
• Discharging corporate social responsibility
• Implementing ethical and socially responsible practices
• Liaise with government agency
Hiring a friend or family member as the local director could be beneficial, providing you trust them. In situations where you need to step away from company affairs, consider granting them limited power of attorney after consulting with a lawyer. This allows them to fulfill additional duties, ensuring your company’s affairs are managed in your absence.
