Singapore Fact-File Part 1:
Business Formation for Individuals
1.2 Singapore Individual Business Registration
The procedures necessary for an individual to commence
business activity
A foreign independent business person looking
to establish a business in Singapore will first need to apply
to the Ministry of Manpower for an EntrePass, which is a type
of employment pass.
Eligibility requirements are that the person seeking to establish
the new business must: be experienced in running a business,
be planning to hold at least a 30% stake in the business,
have SGD50,000 in paid-up capital (i.e. money paid by shareholders
for their shares), and have a truly entrepreneurial business
activity in mind.
A SingPass
is also required for both local and foreign businesses, and
is a password used by the business in all official interactions.
It can be applied for online,
or at one of the counter
locations available.
The vast majority of businesses in Singapore (with the exception
of hawkers, certain types of domestic craftsmen, farmers,
taxi drivers, and professionals such as doctors, lawyers and
accountants, which are managed by their respective professional
bodies) are obliged to register with the Accounting and Corporate
Regulatory Authority (ACRA), with the fees for this ranging
from SGD50-600 (depending on the type and size of the business)
for local businesses, and SGD300-1,200 for foreign businesses.
The approval of a business name is subject to a SGD15 fee.
New businesses can most easily register online,
while foreign firms seeking to establish a branch in Singapore
are advised to hire a professional to register on their behalf,
as the situation is somewhat more complex.
The relevant licence should also be obtained, from the Online
Business Licensing Service; the majority of business types
and activities require a licence or permit of some kind.
After registration and the commencement of business, different
business types have different obligations; but in all cases,
business registration must be renewed annually. The registration
number of a business should be included on all invoices, letterheads,
etc.
Limited Liability Partnerships are required to make an annual
declaration to the ACRA that they are able to cover their
debts, whilst incorporated entities are obliged to appoint
a company secretary within 6 months of establishment, appoint
an auditor (unless there are fewer than 20 shareholders, and
a turnover of less than SGD5m), hold an AGM within 3 months
of incorporation, and file annual accounts.
Need for tax residency in business
There is no requirement for a sole proprietor to be tax resident
in Singapore in order to establish a business there.
Registration requirements for an individual to begin
in business
Most businesses in Singapore (with certain exceptions, including:
hawkers, certain types of domestic craftsmen, farmers, taxi
drivers, and professionals such as doctors, lawyers and accountants,
which are managed by their respective professional bodies)
are required to register with the Accounting and Corporate
Regulatory Authority (ACRA), with the fees for this ranging
from SGD50-600 (depending on the type and size of the business)
for local businesses, and SGD300-1,200 for foreign businesses.
The approval of a business name is subject to a SGD15 fee.
Business registration must be renewed annually.
New businesses can most easily register online,
while foreign firms seeking to establish a branch in Singapore
are advised to hire a professional to register on their behalf,
as the situation is somewhat more complex.
Prior to registration, the prospective business owner should
check the availability of their preferred business name, ensure
that they meet the eligibility requirements for the type of
business that they are hoping to establish (with regard to
numbers of participants, capital, etc), ascertain the Singapore
Standard Industrial Classification code (SSIC) for the
business activity that they are planning to undertake (with
the SSIC allowing the authorities to compile accurate statistical
information in various areas), decide upon a location for
the business, and ensure that any outstanding liabilities,
for example Medisave (a national medical savings account system
via which Singaporeans contribute a portion of their income
into a designated Medisave account, to be used in the event
that medical treatment is required) are paid. However, this
last point will only really be relevant to Singaporean citizens.
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