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Why Singapore?

Why Singapore?

Strategic location and an open economy make Singapore the choicest business destination to set up an international enterprise. Moreover, Singapore’s highly stable political and economic landscape, low taxes and well-qualified human resources make it the world’s most promising place to do business.

Benefits of doing business in Singapore

As young state that has achieved independence in 1965, Singapore has been quick to achieve:

  • Security
  • Consistency
  • Impeccability
  • Judicious economy
  • Low tax rates
  • Splendid infrastructure

All this makes Singapore a desirable investment station. It would not be wrong to describe it as the best-run country in the world.

Want to know more about the benefits? Here you are:

A Robust Economy

Singapore owes its sturdiness and well-conducted economy to the following factors:

  • A highly evolved, trade-driven, open market economy essentially fueled by finance and manufacturing
  • 75 per cent of the country’s GDP is sourced from services that engage 80% of its manpower
  • Decidedly scaled down unemployment and at the same time, sustained low inflation
  • An impressive figure of 44.3 Billion SGD in December 2018
  • No foreign debts
  • Current account surplus on a consistent upward curve
  • Dynamic overseas capital investments
  • IT, housing, education, transport, and health care subsidy programs galore

Due to the good sense and futuristic judgment of its founders, despite being a small country with scanty natural resources, Singapore has a durable economy.

Competitive Tax Regime

The tax policy in Singapore is the most straightforward and practical the world over. Thus for entrepreneurs interested in incorporating and running startups, this is the most sought-after nation.

Singapore has a multi-layered tax regimen for individuals as well as corporates:

  • Substantial tax exemptions for startups in their first 3 years
  • Tax rate of up to less than 5% for startups on the first S$100k of their taxable income
  • Effective YA 2010, the tax on a company is capped at 17% on its taxable income (for both, local and foreign firms).
  • Business sourced capital gains or dividends are completely nontaxable.

Corporate profits are not re-taxed when they transfer dividends to stakeholders. Thus, shareholders have to pay no taxes on the earned dividends.
And now for the best part; Singapore has one of the world’s lowest value added tax rates.

One-time Taxation

Singapore protects its resident firms from double taxation by signing the Avoidance of Double Taxation Agreements (DTAs) with more than 50 countries.

The main purpose of these contracts is to ensure that economic transactions between Singapore and the treaty country are taxed just once. Also, Singapore offers Unilateral Tax Credits (UTCs) for countries that do not have DTAs with it.

Foreigners can hold 100% Company Shares

As a foreigner, you can own all the stocks of the company you incorporate in Singapore, without being dependent on local partners or stakeholders for the following reasons:

  • The country empowers you to incorporate your business with a capital structure and shareholders that are in best interest of your business.
  • You can bring in any amount of capital from your home country and invest it in your Singapore Company.
  • The repatriation of profits is unlimited.
  • Capital gains from the sale of a business are not taxed.
  • Dividends paid to the shareholders is exempt from tax.

Freedom of Movement for Currency

In Singapore, there are no obstructions to the inflow or outflow foreign currency through the country’s borders. This seamless movement of funds makes businesses extremely flexible, when compared to countries that apply compelling interventions to the movement of foreign currencies.

Incorporate and Operate Hassle-free

Singapore has been topping the charts of the World Bank’s Ease of Doing Business survey for nine consecutive years for three simple reasons:

  • Governance in Singapore is highest on efficiency and lowest on bureaucracy.
  • The criteria to register a company is easy to understand and effortless to process.
  • In many cases, companies have been incorporated within one week.

Government Backup for Your Startup

The Singapore government is very supportive towards growth and innovations. Over the last ten years, Singapore has fostered its venture funding community. The benefits of these funding sources come to the fore when you set up and do business in Singapore.

  • Grants, tax incentives and in-kind assistance schemes galore in its offering to startups.
  • In certain sectors, the government also offers subsidy to startups on labor costs.
  • Both, domestic and foreign-run companies can avail these benefits.
  • Presently, it is the best place in Asia for venture funds.

To learn more about how your business can get full benefits from what Singapore has to offer, please contact us.

Thank you for your interest in Pearson.

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