For over twenty years, foreign entrepreneurs have found Singapore to be a popular place to incorporate their businesses. Due to several concerted policies by its government, it has developed into a very business-friendly environment for large foreign corporations. Its benefits include low taxes, ease of doing business, integration with international markets, prime geographic locations, and a workforce of highly qualified English speakers. Due to these factors, thousands of business owners and entrepreneurs relocate there every year from all over the world.
Why Singapore Is the Ideal Destination for Company Registration?
For the first three years after Singapore company registration, and the first $100,000 in profit, a company registered in Singapore is exempt from paying taxes. After this point, Singapore Private Limited Companies’ effective corporate tax is determined using the following slabs:
- For profits between SG$ 100,000 and SG$ 300,000: tax @ 8.5%
- For profits SG$ 300,000 and above: tax @ 17%.
Singapore does not impose capital gains taxes. Dividends to shareholders are tax-free in Singapore for income that has been subject to corporate taxation.
The Goods and Services Tax (GST) was implemented by the Singapore government to make the economy more competitive. With a current GST rate of 7%, Singapore is among the countries with the lowest rates in the world, less than both the Asia-Pacific average of 10.5% and the global average of 16.4%.
A tier system for personal income tax applies, with 0% being the lowest rate and 20% being the highest for income over SG$ 320,000.
With more than 70 nations worldwide, Singapore has a vast network of double tax agreements (DTAs). The three main benefits of the DTA are the preferential tax regime, reduced withholding taxes, and the absence of double taxation. Because of its DTA network and the lack of dividend and capital gains taxes, Singapore is a very desirable location for corporate investments through a Singapore-incorporated holding company.
As a hub for trade and transit, Singapore has no export duties and only a small number of limited import duties on goods like tobacco and petroleum products. This has a lot to offer businesses that deal with suppliers from abroad.
It takes just one to two days to registering company in Singapore. Shareholders can own 100% of the company’s shares, and residency status is not required. The minimum authorized capital stock is S$1 (one Singapore dollar). Also, you have access to a large investing environment.
Singapore also has an advantage over its neighbors due to its flexible immigration laws, skilled workforce availability, excellent standard of living, effective legal system, and strong intellectual property protection laws.
An organization’s long-term survival in the marketplace depends on having a productive and effective workforce. With one of the greatest educational systems in the world, Singapore continues to produce workers of the highest caliber every year. Additionally, a more flexible immigration policy attracts talented foreigners to the nation.
- 100% foreign ownership and no currency control
100% foreign ownership in Singapore refers to the situation where a foreign owner holds all of the shares of a company that is registered in Singapore. Hiring a local partner or shareholder is not necessary for this. This allows a foreign owner to launch their company with the capital structure of their choice and allocate ownership to the best-fitting investors. Additionally, there are no restrictions on bringing in foreign funds for capital structure.
Profits may be repatriated to Singapore without restriction. Even the Singaporean company’s capital gain is exempt from taxation. Additionally, dividend income received by shareholders is taxed by the company and is not subject to any additional taxes.
The government of Singapore has not placed any limitations on the export of foreign currency.
