Singapore is a country that holds a place of honor as an international trade center. Consistency, good business policy, easy enterprise development and low taxes are the major factors that make Singapore a great place for your business to stay.
To international firms and also stakeholders in Asia, it is a brilliant move to set up their headquarters or business here. This adds to Singapore’s status as a prominent business and transaction hub that also well-placed in Asia. Let us try to learn more about why setting up a business in Singapore is always at the back of the investors’ mind.
Among the many reasons for investors to venture into Singapore, here are six main determinants:
Singapore’s economy grew faster than initial expectations. Leaping forward, the services sector is on the brink of delivering the generous portion of Singapore's actual GDP growth in 2018 and this pushes the demand for prime office real estate. Along with muted supply pipelines in the coming two years, this should set the stage for double-figure CBD prime rental growth through 2018-19.
Singapore unlocks the gateway to Asia, with solid grounds – comprising capital, connectivity, broad commercial channels, extremely specialized manpower and lively entrepreneurs - for steady growth.
Apart from unforeseen external upsets or policy shifts, real estate in Singapore is going through a multi-year up-scaling, majorly pushed by housing and business sectors. This up-scaling will be reinforced by a better rate of growth backed by the Government’s initiatives to renovate industries and innovate.
The legal framework in Singapore is among the best in Asia, inclusive of application of laws to combat corruption and help businesses and investors to carry out fair business practices. Singapore has, through years, come up as one of the conflict resolution facilities, thanks to its repute for nonalignment and uprightness.
Singapore has a firm political regime with a parliamentary democratic system. The Government’s business-friendly policies have also enhanced Singapore’s drawing power as an investor’s delight.
The urban setup in Singapore, whether buildings, logistics or telecom system, is advanced and very dependable. It has set on its Smart City drive to connect prospects from technology and innovation. In a report by the World Economic Forum in 2015 Singapore was placed at the top in the world’s top network-ready nations.
High investor confidence, together with the core intensity of the real estate sector, goes as far as making Singapore a charming investment resort in Asia.
Along with the general positives of Singapore, there are also the company incorporation advantages.
Singapore has zero red-tapisms in foreign company regulations, zero tax on capital gains or estate and one of the least corporate tax rates in the world. Also, 75 inclusive double taxation treaties and 8 limited treaties make it easy to realize why around 7,000 multinational companies are housed in Singapore.
Singapore offers easy availability of inexpensive workforce and rising markets of adjoining areas.
The world’s best airport – Changi International – caters to 80 multi-national flights reaching out to people of more than 190 cities of 160 nations every day. Many foremost logistics companies such as UPS and FedEx, are Singapore-based endorsing business connectivity and ease of cross-border trade.
Corporate tax is calculated at 17%, based on the company’s taxable income, i.e., taxable income after deducting permissible expenses and other grants, the net tax payable is quite lower considering the different state benefits, allowances and schemes.
These comprise Corporate Income Tax relief, Productivity and Innovation Credit Scheme, tax relief for new companies that qualify for the Start-up Tax Exemption (SUTE) scheme, and the Foreign-sourced Income Exemption scheme (FSIE).
Singapore has more than 123 commercial banks, 154 fund managers and 291 capital market services license holders. This helps entrepreneurs in fund-raising at rates of just 1 % per year. So if you have something that adds to the economic value, funding is never a problem.
Singapore also provides aid in the form of funds to new entities and already functional firms here. Instances of this can comprise SPRING Singapore offering micro-loan schemes, or programmes to the tune of loan insurance scheme, Start-up Enterprise Development Scheme (SEEDS) and Local Enterprise Finance Scheme (LEFS). There is also an Innovation and Capability Voucher (ICV) scheme for the benefit of companies.
To begin with the practical company incorporation, subject to all documents being in place, it is just a matter of a few hours.
It is mandatory for every business in Singapore to get itself registered with the Accounting & Corporate Regulatory Authority (ACRA) – the national authority. An extra condition for foreign entrepreneurs and companies keen to incorporate a Singapore subsidiary or a mother company is to hire two local agents who may be Singapore citizens, permanent residents, or foreigners, who must be holders of employment or dependent passes.
It is easy to appoint residents as the country has a worthy population of English-speaking and extremely-talented labor force, most of whom are world-class educated.
Companies in Singapore can also opt for hiring foreigners, which is much easier with the help of Singapore’s age-old open-door migration policy. Foreigners can be employed in Singapore on work visas. Work visas can either be work permits, S Passes or an Employment Passes – the favorites of most professionals, managers and executives.
Ever heard of labor trouble or strikes in Singapore? It never exists and so nonexistent are no minimum wage rules. However, there are two legal obligations for employers concerning their contribution per employee; the Central Provident Fund (CPF) contributions and the Skills Development Levy (SDL).
Lastly, the country’s Group Relief System for loss transfer also benefits businesses in Singapore. With this scheme, companies within a group can transfer current year’s unutilized losses, donations and unused capital grants; thus enabling the incorporators/owners to go for bigger challenges.
Singapore is the first country in the world that provides a superbly-operational pro-business environment to startups. Its ‘fit as a fiddle’ economy, a geographic location that is a strategic dream, lucrative tax regimen and a government that warmly welcomes new businesses.
Every year thousands of local and foreign entities make Singapore a new home for their business. Let us help you do the same. Contact us to know more.
Are you a foreigner looking to relocate to Singapore to start and run a business? Then the Singapore Entrepreneur Pass or EntrePass is just the thing for you. To be eligible to apply for this work visa, the entrepreneur who intends to come to Singapore to establish a company, must display a paid-up capital of at least S$50,000. This helps entrepreneurs who have a more successful professional record, as compared to documented qualifications. The EntrePass works perfectly for foreign businesspersons who fall short of academic certifications or are not eligible according to the Employment Pass scheme, but have proved their business expertise through booming professional experience. In practice, applying for an EntrePass used to be more difficult than that for an Employment Pass (EP), due to the paid-up capital requirement of S$50,000. However, this requirement has now been removed to attract more qualified applicants worldwide. What Makes You Eligible and Ineligible for the EntrePass? A foreign entrepreneur can apply for the EntrePass if the following conditions are met: 1. The candidate has or aims to launch a private limited company, registered with the Accounting and Corporate Regulatory Authority (ACRA) in Singapore. In case the company has already been registered, it should be less than or equal to 6 months old on the date of application. 2. The applicant must be a minimum 30% shareholder in the capital of the company.Additional Provisions The applicant is required to meet a minimum of one of the listed requirements, either in the capacity of an innovator, an entrepreneur, or an investor: Innovator · The enterprise should be a holder or an intellectual property asset. · The company should have had participated in joint research with A*STAR or a university. · The company must possess excellent technical or domain expertise that is connected to the intended business. Entrepreneur · The financial support of the company must come from a Government-recognized VC or business angel. · The company should have active involvement in a Government-supported incubator. · The candidate must have a proven track record or network and bright business history of having launched very lucrative enterprises. Investor · The candidate must have a good previous experience of business investments and should be keen on expanding a new company or already existent one in Singapore. You can learn more about these requirements here. Businesses Ineligible for the EntrePass Cafés, cafeterias, massage parlors, pubs, night clubs, job placement services and others, do not qualify for the EntrePass. A full account of the businesses that do not qualify for the pass is available on the MOM website. The Application Procedure How to Apply? An applicant or a representative of the applicant is eligible to submit an application for the EntrePass. The MOM lays down the steps listed below to apply for the EntrePass: 1. An applicant must attach the EntrePass application form with necessary documents and submit the pack. 2. Once the application has been approved, as a policy, the MOM will issue an approval letter. The applicant is required to register the company (in case not already done so) with ACRA within a month of receiving the letter. 3. As a rule, the EntrePass should be issued within 6 months of the approval letter. 4. Once the EntrePass has been issued, the fingerprint and photo registration of the candidate is required. 5. MOM will send the card to the address indicated in the application. Essential Paperwork The following documents must be attached and submitted along with the application for the EntrePass: 1. Copy of the individual information page of applicant’s passport; 2. Previous service testimonies in English; and 3. A plan of action that mentions the enterpriser’s business strategy, market research, market plan, products or services in the offering, etc. Bear in mind that at the time of applying, if the business is already registered with ACRA, the following must be submitted: 1. A copy of the company’s recent profile (as can be seen on the ACRA website) How to Renew, Cancel and Replace the EntrePass? EntrePass Renewal The EntrePass that is issued for the first time has a validity of 1+1 years. This means that one year after its issue, the EntrePass must be renewed. If all eligibility requirements for renewal are fulfilled, the validity is extended for one additional year. From then on, all the EntrePass renewals that follow will have a 2-year validity. An EntrePass holder can put forward an application to get his pass renewed, 3 months before it expires. Among the renewal requirements is that the EntrePass holder must retain the initial business plan submitted to the Ministry when applying for the first time. For renewal of the pass, the holder needs to make sure that his business creates employment in Singapore. For more information on the renewal of an EntrePass click here. Cancelling the EntrePass In case an EntrePass needs to be cancelled, it can be done by the pass holder, a company agent or an employment agent. The cancellation should happen and the pass must be returned in a week’s duration after the closure of the business. Replacement of the EntrePass In case of theft, loss or damage to EntrePass, the holder of the pass, or an agent appointed by the company, or an employment agent can submit an application to have the pass replaced, not later than 7 days since the loss. Additionally, in case an EntrePass holder’s card is stolen, the incident must be reported to the police. Notification of Changes If any one or more of the following changes are to be done to an EntrePass, the pass holder must notify the MOM: 1. Line of business; 2. Candidate’s personal information, home address, office address; 3. Salary; 4. Company name and account info and 5. Line of work To know more about notifying these changes and the related timeframes visit the MOM website. Family Onboard There are two passes that enable EntrePass holders to call their families to Singapore and be with them; the Dependant’s Pass orthe Long Term Visit Pass. The eligible family members comprise: 1. Spouse. 2. Common-law spouse 3. Unmarried and lawfully adopted children, below 21 years of age 4. Unmarried differently-abled children, above 21 years of age 5. Unmarried step-children below 21 years of age 6. Parents EntrePass holders can get their family members on board in Singapore, once they have successfully renewed their passes. In other words, EntrePass holders are not allowed to get their family members after they apply for the pass the first time. Also, to get a family member to Singapore the EntrePass holder must ensure that he or she meets the total business expense and employment generation conditions as ruled by the MOM. Conclusion An EntrePass is a necessity for a foreign entrepreneur who intends to set up and operate a business in Singapore. Do not forget that the MOM carefully scans all applications, as well as the business plans that are submitted along with them, to check if the submissions conform to the requirements of the Ministry. With our help, your chances of getting the Singapore EntrePass are much higher and free of troubles. Contact us today so that we can evaluate your eligibility and come up with ways that increase your hit rate. This is your chance to live and do business in Asia’s most desired city.read more
About Reinsurance Reinsurance is a contract under which a reinsurer agrees to indemnify a ceding company against all or part of the primary insurance risks underwritten by the ceding company under one or more insurance contracts. Market Trends Singapore is not only Asia’s largest international financial center but also one of Asia’s largest international reinsurance centers. The Singapore insurance market remains very competitive. As of the end of 2016, the market had gross premiums total receipt of about over S$3.97 billion and a total asset worth of about S$11.14 billion. Statistics collected over the seven-year period between 2010 and 2016 indicate a growing market. Total gross premiums and retention ratios have increased year on year, indicating good growth prospects for the market as a whole. In particular, the Singaporean general insurance sector registered a compound annual growth rate of 23.1% from 2010 to 2016 in respect of gross written premiums. Since 2011, statistics show that the offshore insurance market has maintained its retention ratio at about 60% and increased its total assets up to S$22.2 billion. The Singapore reinsurance market remains extremely competitive. Total gross premiums for the reinsurance industry were S$4.9 billion in 2016 and retention ratio has been 69.1%. Regulatory Framework The Insurance Act (Cap 142) governs insurance and reinsurance activities in Singapore. Regulatory Bodies Insurance and reinsurance activities are regulated by the MAS (Monetary Authority of Singapore), established by the Monetary Authority of Singapore Act (Cap 186). MAS is responsible for the licensing, authorization and supervision of insurance and reinsurance activities. Authorized Reinsurer Overseas insurers may apply for authorization to carry on life and/or general reinsurance business in Singapore. Authorized Reinsurers: - Do not have a physical presence in Singapore and provide insurance services from overseas to persons in Singapore. - Are subject to limited oversight by MAS compared to licensed insurers : Not required to set up and maintain separate insurance funds for policies taken out by persons in Singapore : No need to comply with solvency margin requirements Admission Criteria MAS assesses applications for authorization of reinsurers based on these criteria: - Domestic and international rankings of the applicant by factors such as premiums and assets - Past and present credit ratings by international rating agencies (i.e., Standard and Poor's, A.M Best, Moody's and Fitch) - Track record, financial soundness and reputation of the applicant MAS will consult the applicant's home supervisory authority to check the applicant’s compliance with its home regulations. - Risk management systems and processes aligning with the size and complexity of the business - Fitness and propriety of the applicant and all persons having control of the applicant Documents To Be Submitted Along With The Application Form 1) A certified true copy of the license issued by the insurance supervisory authority in the country in which the company is carrying on insurance business 2) A copy of the annual report and financial statements of both the applicant and its ultimate parent company for each of the last three years Processing Time It will take approximately 6 to 8 weeks after submission of complete application to process and approve an application. As each application will be evaluated on a case-by-case basis, processing time depends on the circumstances of each application and the completeness of the information submitted. Annual Fee Every authorized reinsurer shall pay an annual fee of S$10,000 to the Authority before 1st January of each year. License For Reinsurer Applicants need a license to carry on life and/or general reinsurance business in Singapore. Admission Criteria MAS assesses applications for life and/or general reinsurance licenses based on these criteria: - Same as admission criteria for authorized reinsurer - Well-developed business strategy and detailed plans reflecting the risk profile of the business Documents To Be Submitted Along With The Application Form 1) A certified true copy of the license issued by the insurance supervisory authority in the country in which the company is carrying on insurance business 2) A certified true copy of the letter from the insurance supervisory authority in the country granting the company to establish insurance operations in Singapore, if such approval is required. (If approval is not required, a statement to this effect should be provided.) 3) A copy of the annual report and financial statements of both the applicant and its ultimate parent company for each of the last three years 4) A copy of the feasibility study conducted in respect of the proposed Singapore operations (including financial projections for the proposed Singapore operations). Taxation Of Insurance And Reinsurance Providers Under the Income Tax Act, all companies are generally taxed at the rate of 17% on their chargeable income. However, some insurers may be subject to different tax rates depending on the type of insurance business carried on. ∙ Life Insurance Business Insurers carrying on life insurance business are subject to a tax rate of 10% on life insurance surplus of any life insurance fund apportioned to policyholders for each year of assessment. ∙ Marine Hull and Liability Insurance/Reinsurance Business Tax is payable at the rate of 5% on chargeable income derived by an approved marine hull and liability insurer for each year of assessment. ∙ Offshore General Insurance/Reinsurance Business An approved insurer carrying on offshore life insurance business and insuring/reinsuring offshore risks will be taxed at the rate of 10% on chargeable income for each year of assessment. ∙ Captive Insurers Captive insurers are exempt from tax on any underwriting income derived from insuring offshore risks. Singapore Insurance Market Trends Source: MAS (Monetary Authority of Singapore) Life insurance valuation results for the year ended 31st December 2018 - Professional Reinsurer Source: MAS (Monetary Authority of Singapore) If you have any questions about Singapore company incorporation and investment in Singapore, please contact us via Contact Us page. We will provide you with a variety of solutions for efficient business operations as well as practical advice on legal requirements.read more