6 steps to start your business in Singapore
Singapore plays a pivotal role as a business epicentre in Asia – it holds a unique position in the global economy that acts as a gateway to the rest of the Asian Pacific region. With its low tax rates, a skilled, English-speaking workforce, its respect for intellectual property rights and its strong trade and investment opportunities, it is certainly one of the most competitive Asian countries to launch your start-up in.
If you want a springboard with which you can access the region’s developing economies with your start-up, Singapore is one of your best bets. In this article, we’ll look at all the steps you need to take to establish your start-up in this reputable financial and regional trading centre.
#1: Getting the right visa
The Entrepreneur Pass, or EntrePass, is the visa required for those who are looking to start a business in Singapore. While regulations were previously tightening, they have become more lax in recent years. The most important thing to note is that the EntrePass must be applied for either before, or within six months of the date of registration of the company. After six months, you will need to apply for an Employment Pass instead.
Foreigners are eligible for the EntrePass if the aforementioned requirement is satisfied, and if their company is a private limited one registered with the Accounting and Corporate Regulatory Authority (ACRA). You will also need to hold at least 30% of the share capital of the start-up. Lastly, you will need to fulfil the requirements as an Entrepreneur, Innovator or Investor – you can find the details of these categories here.
The documents you will need to support your application are passport photocopies, past employment testimonials in English, and a comprehensive business plan that states your start-up’s business idea, market analysis, market plan, products/services to be offered, etc. If your business has already been registered with ACRA, you will also have to submit a copy of your start-up’s latest profile as seen on the ACRA website and a bank statement that shows the required minimum paid-up capital of S$50,000.
#2: Establishing your business entity
Establishing your business identity in Singapore is a relatively simple and straightforward process free from unnecessary red tape. There are six main requirements your company must fulfil to qualify for registration in Singapore:
- Having at least one and a maximum of 50 shareholders – they can be local or foreigners, individuals, or corporate entities.
- Paid-up capital of at least S$50,000.
- At least one Singapore-resident director (i.e. someone who is a Singapore citizen, permanent resident, or employment pass holder) – other directors can be foreigners.
- A company secretary who is a natural person, a resident of Singapore, and who has been appointed within 6 months of company registration.
- A local registered business address which cannot be a PO box.
- An ACRA-approved company name – check here for currently registered company names to ensure the one you want hasn’t already been taken.
Once these six requirements are fulfilled, you can register your business online with ACRA. The process is relatively hassle-free and takes about an hour. Alternatively, companies such as Sleek can handle the whole process for you, and they’ll provide you with a company secretary to take some work off your plate. FLYDESK CLUB+ members enjoy a SG$ 100 discount with Sleek – get your coupon code here!
#3: Tax and auditing
This is a mandatory step for most business entities like the Limited Company and you need a third party to record your annual audit reports. In terms of taxes, all companies are required to submit two income tax forms to the Inland Revenue Authority of Singapore (IRAS) – the Estimated Chargeable Income (ECI) and Form C-S/C. Note that you will not need to file an ECI if your annual revenue was less than 5 million for the financial year.
Companies that help with business registration such as Sleek typically also offer tax and auditing services to take this time-consuming task off your hands.
#4: Open a bank account
While it is not mandatory to open a business bank account (i.e. you can use your personal bank account if you wish to do so) it is highly advised as it makes taxes easier to do and is overall more professional. There are three main business bank accounts to consider in Singapore: DBS, OCBC and UOB.
DBS’s Entrepreneur Account for Start-ups is by far the easiest account to open, and there are plenty of ATMs and bank branches around Singapore too. All you need to do is make an initial deposit of S$500 and you’ll be approved quickly. Do note that you will have to maintain a minimum balance of S$10,000 per month or you will be subjected to a fee of S$15. While they do charge additional fees such as a setup fee, security device fee and a monthly maintenance fee, these are waived for the first two years as are the annual corporate debit card fee.
The OCBC Business Entrepreneur Account and UOB Current Account are also good options to check out. In addition, you can choose to opt for a virtual bank account to make dealings with international clients even easier!
#5: Recruit the right candidates
When it comes to recruitment, websites such as JobStreet, JobsDB and LinkedIn are the best ones in Singapore. You can also check out MyCareersFuture – but note that this website is only open to Singapore citizens and permanent residents.
Do note that you will have to contribute 17% of citizens’ and permanent residents’ salaries towards their Central Provident Fund (CPF).
As office rentals in Singapore can be extremely expensive – especially if you want an office in or near the Central Business District, coworking spaces are a good choice for start-ups. There are plenty of coworking spaces clustered in and around the CBD in Singapore, and they come with several benefits such as flexible offices for rent, meeting rooms, operational support, exclusive lounges and more. Coworking spaces are also great if you offer flexible work, as they allow people to come into work when they need to and work remotely when they don’t – an especially valued perk given the current global climate with CoVID-19.
Credit Crane River Valley
If you’re interested in booking a coworking space for your business, check out our lovely spaces in Singapore.
One last tip to keep in mind is to build your brand – the best way to do this is through social media and general media coverage. Ensure you have a well-designed website to attract potential clients or partners and keep people updated on and engaged with your business via Twitter and LinkedIn.
So, there you have it, a comprehensive guide on establishing your start-up in Singapore! If you’re interested in doing so, contact FLYDESK and we’ll walk you through the whole process to make it as stress-free as possible.