All About Singapore Company Incorporation For Foreign Businessmen
Foreign businessmen and companies can easily setup a business presence in Singapore
as long as they will provide a sound business plan or have a strong track record and good reputation.But since any foreign entities are prohibited to self-register their own business, it is a legal requirement to hire a professional registration firm that will act on their behalf during the application of Singapore company incorporation.
Meanwhile, foreign individuals and companies are required to appoint one resident director who may be a natural citizen or holder of Permanent Residence Status or Employment Pass. However, there is no limit on the number of directors regardless if they are foreigners or local residents as long as they have a registered address in Singapore and have not been involved in any malpractices.
It is important to note that directors are also legally required to perform these duties stated by the Accounting and Corporate Regulatory Authority (ACRA):
* Submit the income tax returns of a company.
* Provide an accurate and truthful declaration of income.
* Make sure that all declarations regarding their company is accurate even if they have hired tax agents.
* Perform other statutory requirements stated by Singapores Companies Act.
For foreign companies which already have an existing business and want to expand their operation in the country, they should register a subsidiary company which is essentially a private limited company in which the main shareholder is a foreign businessman or another business entity.
While a subsidiary company may be owned 100 percent by its foreign parent company, this business entity is still considered as a local resident being incorporated in Singapore. With this, it can enjoy local tax benefits and exemptions (complete tax break from its first S$100,000 chargeable income within three years of its Singapore company incorporation).
Another advantage of this setup is that foreign companies have a limited liability, meaning, they cannot be held liable for the losses, debts, and acts of their subsidiary company which is treated as a separate legal entity.
As a local resident business, a subsidiary company is expected to exercise its management in Singapore instead of its foreign parent company giving direct orders.
In case that a foreign company owner or businessman wants to setup a Singapore company but do not want to relocate in the country, he should appoint at least one resident director. But in case that he wants to personally manage his business, he is required to apply for Employment Pass or EntrePass.
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