Key Areas You Must Consider When Incorporating a Business in Singapore
Incorporating a business in Singapore may be compared to building a house: you need to have a solid foundation, choose the right building materials and use skilled and experienced labor that will translate the plan you have into a real house. When you get the foundation right for your business, you make it easy for other components to fit well in the future, not to mention that the business will be primed for success in the long run.
With so many building blocks involved in setting up a business in Singapore, it is easy for one to get overwhelmed with all the due process and find themselves lagging in terms of the timelines they ought to have observed. To help you out and bring more clarity to the process, here are some of the key areas you must get right when starting a business in Singapore-:
Know the relevant government bodies you will have to deal with
In the process of incorporating a business in Singapore, you will be required to get licenses, permits, and certifications from various government bodies and agencies depending on the nature of the business you will be doing. Some of the key government bodies you will have to deal with include the followings:
- The Accounting and Corporate Regulatory Authority, ACRA – this is the body responsible for regulating businesses in Singapore. It is also within its domain to regulate accountants as well as corporate service providers in the country.
Monetary Authority of Singapore, MAS – if you intend on setting up a business in the insurance, finance and banking industries in Singapore, then this is the body you will be dealing with, and which will give you the clearance to go ahead and start the business.
- Inland Revenue Authority of Singapore, IRAS – when operating a business in Singapore, you will have tax obligations to meet, and it the IRAS that is responsible for collecting taxes in the city-state of Singapore.
Ministry of Manpower, MOM – if you are a foreigner with intentions of starting a business in Singapore, you will require the appropriate visa to live and do business in Singapore. It is known as the EntrePass, and you will obtain it from the Ministry of Manpower.
- Legal Services Regulatory Authority, LSRA – for new licenses and registration, this is the primary body you will have to deal with. You will also find it very resourceful when you want to set up a law firm, for both local and international clients, in Singapore.
The laws governing businesses in Singapore
You are likely to run into a lot of problems if you are thinking about incorporating a business in Singapore, but you don’t know about the relevant laws. Many are the business laws in the country, but when you are just starting up, you don’t need to know all them in finer details.
However, there are a few fundamental regulations you must know right from the word go if you desire to have good business experience in the country. Here is a brief look at some of the most important ones-:
- Goods and Services Tax, GST – if your annual turnover is over SGD 1million, then you will be required to register for the Goods and Services Tax. This law regulates taxes imposed on goods and services by companies generating over S$1 million.
- Central Provident Fund, SPF – it is a legal requirement that employers, citizens, and residents allocate a percentage of their monthly income for the CPF. It is some kind of a pension scheme which can be accessed upon retirement.
- The use of your registration number – ACRA will issue you with a business registration number, and it is a legal requirement that this number must appear in every official business communication you make.
- Custom Laws – if your business will be dealing with importation and exportation of goods, you will have to register with Singapore Customs and comply with all the regulations and guidelines for moving goods in and out of Singapore.
- Manpower laws – when you start to hire employees for your new business, there are manpower laws in place designed to protect the rights of every employee, as well as to regulate the engagement of foreign workers in Singapore. If you need to more about these and other employment laws, contact the Ministry of Manpower for the relevant details.
Avoid the common business incorporation pitfalls
There are certain pitfalls that most entrepreneurs have fell for in the past, and which you must be very cautious about if you don’t want a nasty experience when incorporating a business in Singapore. Some of the pitfalls you must watch out for include-:
- Going for the wrong business structure – take time to consider your business structure as it will have a direct impact on the benefits your business can receive from the government, as well as requirements you will have to meet when starting the business.
- Delaying with the registration – taking too long to complete the registration may lead to a myriad of inconveniences, such as missing out on your preferred name because someone snatched it while you were still taking your sweet time.
- Missing steps and ignoring the details – it is important to go over the details issued by the government when you are incorporating a business in Singapore. If you miss a document or skip a step during the setup process, you will not just be wasting your time, but also you may be liable for fines and even imprisonment in Singapore.
- Not taking advantage of the tax incentives – the government in Singapore encourages the incorporation of businesses through various tax incentives. If you qualify for such incentives, you can save a considerable amount of money for your business, and such may help you get up on your feet as fast as possible. Check out all the incentives available for businesses in your industry, and be sure not to miss them.
Get help from the pros
If you want things done right the first time when incorporating a business in Singapore, then you must realize the importance of working with the pros. You can outsource the entire process of business incorporation, and once the company is up and running, you can also hire pros to take of business functions such as accounting and payroll management.