Setup your Business in Singapore as a Foreigner now!

If you are doing research of how to setup your business in Singapore as a foreigner then you are at the right place because in this article you will learn about various business options in Singapore for foreigners. 

A foreigner can register for a private limited company in Singapore. You can also advance/relocate to Singapore to manage the business on your own with the right work permit or Employment Pass in place. You may also have a choice to hire a Resident Director if you don’t want to go to Singapore and wish to drive the business from anywhere else in the world. 

Singapore is one of the world’s most suitable countries in Asia to get started with a business hence the reason why thousands of startups will eventually consider to setup business in Singapore as part of their growth initiative mainly due to the simple and beneficial tax policies both to the company and to the shareholders of the firm. It is considered as the best business market for several reasons. The inducement of various governments is also one of the reasons people like to start their business in Singapore. 

Furthermore, the country yet maintains its status of being superior in the field of business. 

Fresh foreign investors think first about Singapore whenever they wanted to commence their business. Some people desire to manage their Singapore business from their hometown while other plans to stay in Singapore to handle all the things personally. Well, in this article you will find options for both of the above conditions. 

Start your business in Singapore 

The most necessary thing to get started is to choose the business entity to incorporate. If you are a foreigner, you need to retain the assistance support of a professional corporate service provider. For this purpose, an application is submitted for incorporation through the electronic portal of the Accounting and Corporate Regulatory Authority also known as ''ACRA'', a national company registrar.

If you want to apply, you must get a SingPass from one of the citizens of Singapore, Singapore permanent resident or from those who have issued a FIN number along with their employment pass.

The incorporation method of Singapore business is considered as the fastest in our globe. It will be completed within two-and-a-half days, depending on the ACRA and other government bodies that analyze your application. If they find any objection in your application it may take more time than usual or your application might get rejected. 

A good professional corporate service provider guides you to start a business in Singapore. It depends on the specific data needed for the application process. You have to enter the following details of your business on the application.

· Business Name 

· Proposed Principal Activities of the Business

· Minimum paid-up capital of $1.00*

· Local registered office address

· Name and relevant details of the Resident Director 

· Name and relevant details of one Shareholder

· Name and relevant details of the company Secretary

In Singapore, the need for the least paid-up capital is somehow meaningless and it also does not demand any bank statement. The corporate bank accounts are opened because they are part of the post-incorporation process. 

But there is a legal condition for the incorporated company to have a locally registered office address. The appointed director would also be the permanent citizen of Singapore.

People who are Permanent Singapore Residents, Entre-Pass holders or Employment Pass holders stand under the definition of ordinarily residents of Singapore.

Incorporating a Company and Relocating to Singapore to Run Your Business

The foreigner will need an employment pass or entry pass to relocate to Singapore. This pass can be applied only once the company is incorporated. Consequently, the foreign entity can decide to set-up its services in Singapore from the following given options:

1.  Private Limited Company and Employment Pass

This option means that the foreign corporation incorporates a fully owned subsidiary company that has a limited number of shares. The employee of that subsidiary company would contain an Employment Pass

2. Private Limited Company and Entre-Pass

This option refers that the foreign corporation incorporates a fully owned subsidiary company. The employee of that subsidiary company would contain an Entre-Pass. The company also has limited shares.

A resident director is needed for both the above options for the incorporation process. Therefore, a nominee director can be employed to meet legal demands and perform the director’s duties, while the employee’s employment pass or Entre-Pass is in the process of approval. 

Appointing nominee resident director is the third option to meet the legal demands for the period in which the company brings out its work in Singapore. 

Application for Entre-Pass VS Employment Pass

The rules for Employment Pass acceptability are conditioned on the applicant rather than the business, which seems quite easy. But it is becoming extremely difficult to obtain an Employment Pass as the government has a stronger filtering process in place to promote local hiring since the pandemic.

Therefore, you should contact a good and licensed employment agency. These agencies help you to collaborate with the Ministry of Manpower, guide you accurately on the application process and submit your application quicker.

Thorough preparation is required for the Entre-Pass. It includes the submission of a lengthy business plan of about 10 pages with complete details of your business aims and objectives. Selecting the potential locals-only is also necessary for the Entre-Pass.

Before starting a business, it is important to research on the industries that are doing great in Singapore and the industries that are growing rapidly with the support of the government. 

Industries that show the potential to grow and have high value are naturally able to get benefits from more government incentives and support from recognized institutions. 

Singapore has active and experienced employees therefore their expectations are remarkably uplifted compared to its rivals. It is also important to note that a person can apply for Employment Pass only when the incorporation of the company is conducted. The processing period is faster than Entre-Pass.

It must be applied within a limited time of about six months of incorporation. If you want to apply for Entre-Pass make sure that all your documents and files are ready so that all the processes can be made quickly within the period of six-month.

Incorporating a Company and Running Your Business from Overseas

If the foreign investor is willing to manage their business in Singapore from elsewhere there is an option to hire a resident director to fulfill the duties of a director. It can be a person of great trust or a nominee director. Corporate Secretarial service provider helps you find a nominee to be appointed for an eligible director.

3. Engaging a Resident Nominee Director

You should appoint a responsible director because the duties of a resident director is critical to the business. The person can be from your local contacts or a resident director. A corporate secretarial service provider can provide you with contacts for a nominee director as an alternative.  

The director is responsible for all the company loss and failure of its statutory obligations, such as the employees’ failure to make payment of the taxes to the Inland Revenue Authority of Singapore and the late filing of its annual returns. 

That is the reason many locals don’t desire to do this job or they may set various conditions to protect themselves in any delicate situation. A resident director should have the following characteristics as specified under the Companies Act:

• The nominee should be a fair-minded person of over 18 years of age (corporations can not be a director).
• The executive would not be un-discharged bankrupt by the Singapore or international court. 
• The person must not an inexperienced director of an indebted company.
• The person should not be a director of such a company that was strained on grounds of national security or affair.
• The person has not been caught to any crime including fraud or corruption.
• He has not been found at fault in Singapore of any crimes related to the development or administration of the corporation. 
• The person must not find guilty of more than three offenses over the last five years in connection to the terms of the Companies Act. 
• It should not be directed to a disqualification order under section 34.35.36 of the bounded Contract Partnership.

It is also vital to note that it is quite important to have a sound relationship with the appointed director. Because if the director declines to approve any particular papers It becomes challenging for the company. Multiple documents are crucial for corporate transactions. If your relationship with the resident director damages and he decided to resign, the company has to clamber. In the situation, you should have to immediately appoint a fresh resident director before the resignation of your current director.

Conclusion

Most of the foreign businessmen preferred the first option. There are many reasons for the selection of that option. Firstly, the application process and commitments of Employment Pass is easier than of Entre-Pass.

Secondly, the company always guarantees that employees fully understand his/her responsibility whenever an employee is appointed to be a director. There is also an option to select a professional corporate service to support the company and its directors.