With strong legal governance and an attractive tax system, alongside other perks and benefits, Singapore has consistently ranked as the best country for foreign entities to establish a company. The country's strong currency and positioning in the global economy make it an ideal place to set up an overseas corporation.
1) Easy to Incorporate Company Online and Low Set-up Cost
In the most recent year (2020), World Bank has ranked Singapore #2 as the top country to do business in. It has one of the most efficient and bureaucracy-free regulated frameworks in the world.
Companies in Singapore simply have to submit their application through ACRA with the required documents and the steps to register a business are usually completed within 15 minutes. The annual compliance requirements are simple and the paperwork is easy to follow through. Cost to set up includes:
· S$15 government fee for company name application with ACRA
· S$300 government fee for the registration of the company with ACRA
· Minimum paid-up capital to set up a company is S$1
2) Attractive Tax System
Singapore is one of the countries with the most business-friendly tax regimes. Companies are taxed at a flat rate of 17% of their chargeable income and this applies to both local and foreign companies.
The Start-Up Tax Exemption scheme was introduced in 2005 to support new businesses. As of 2020, qualified companies can obtain a 75 percent tax exemption on the first S$100,000 of chargeable income during the first consecutive three years. The next S$100,000 of chargeable income can receive a 50 percent tax exemption. This scheme is available for the first three-yearly assessments and after this period, companies can apply for the partial tax exemption scheme.
Avoidance of Double Taxation
Corporate profits are not double-taxed when they are passed to shareholders as dividends. In other words, dividends are distributed to shareholders tax-free.
Also, Singapore has an extensive network of Avoidance of Double Taxation Agreements (DTAs) with over 50 countries. These agreements are designed to ensure that economic transactions between Singapore and the treaty country do not suffer from double taxation. Furthermore, Singapore provides Unilateral Tax Credits (UTCs) for the case of countries with which it does not have a DTA. Thus, a Singapore tax resident company is very unlikely to suffer from double taxation.
3) 100% Foreign Ownership
Singapore allows a foreigner to register a company and own its 100% shareholding. There are also no restrictions on the type of business activities a company can engage in and no special or additional approvals are required. This enables a foreigner to start a company in Singapore with the freedom to distribute ownership as they wish to suit their investment needs. There are also no capital requirements on the capital business owners can invest in Singapore company.
4) Geographic Location and Highly-Developed Infrastructure
Foreign companies have chosen Singapore as their ideal location to set up new companies out of their home bases as its prime location makes it easy for these entities to tap into other emerging markets in Asia.
Besides being strategically located a stone's throw away from other business hubs in Asia (i.e. China, Hong, India, Australia, etc.), the airport itself provides convenient flights to nearly every major city in the world. Its highly-developed infrastructure also makes the city accessible, as well as a conducive environment for businesses to work in. Its cosmopolitan ambiance and best-in-class public transport system make it easy for ex-pats to settle in.
5) Positive Perception and Strong Legal Governance
Singapore is well-known for its stable political environment with anti-corruption laws enforced. These offer entrepreneurs and investors a strong sense of security and comfort, without the fear of bureaucratic malaise. The world has always perceived the country to be modern, well-functioning, rule-following, with strong and efficient legal governance.
The Singapore legal system has received global recognition for its integrity, making it the least bureaucratic one worldwide. Companies in Singapore often find that they can manage the company at ease without worrying about red tapes or corrupted systems. The system continues to grow and build its system in order to maintain its relevance in the current cultural, economic, and commercial climate, by absorbing the common law as well as best practices from other mature legal systems.
About SODA Global Marketing
SODA Global Marketing aims to connect overseas companies with the consumers in China; by helping them to launch and develop a market here. We provide a comprehensive range of services including all aspects of business incubation, brand strategy, company registration, and every element of demand generation.We are already listed as Digital Marketing Agencies in Miami.
Our mission is to build a full ecological business environment for the Chinese market and to develop a community of successful companies that can then provide assistance to new entrants. Click here to read more about the full suite of services we provide.
Comments