Singapore is one of the most active business meccas in the world today. Its rich and bustling commerce provides plenty of opportunities for people who want to put up a business. If you are an entrepreneur planning to set up a business in Singapore, there are a few steps you need to take. Here is a quick guide to company incorporation in Singapore for you.
Plan, plan, plan
As with any venture that involves a significant amount of money, it is important to plan your steps. Ideally, you should already have a solid business idea at this point. Keep in mind that a well-defined plan will serve as the foundation of your future business. To make an effective plan, look into the most important factors such as risks, potentials, challenges, competition, etc. Also, check your financial capability and your marketing strategy early on.
Know your capital
Have a clear understanding of your company’s share capital. You need to decide on the best shareholder structure to use on your company. Your company’s constitution should specify details of your firm’s share capital, which includes shares issuance and classes.
The Singaporean government requires businesses to keep on hand their share capital. Share capital, particularly paid-up capital, is necessary for startups in the beginning of their operation. You have to make sure that your business survives its first few months; that is why you have to be aware of your share capital.
You can incorporate with just a S$1 minimum paid-up capital. Any form of legal currency is accepted. There is no minimum paid-up capital requirement when you apply for an Entrepreneur Pass (EntrePass) and Employment pass (EP). Remember though that a reasonable sum translates to higher credibility for your company. It is recommended that you have a higher paid-up capital, say S$50,000.
Accomplish your checklist
The following documents and steps are necessary for you to be able to incorporate your company in Singapore.
- An approved company name. The company name must not be obscene, not violate existing trademarks, not be the same as another Singaporean firm, and not reserved by another company.
- A short statement of the company’s activities
- Constitution of the company
- Company’s proposed financial year-end
- Director’s information. You will have to appoint one resident director. You may indefinitely appoint additional resident or non-resident directors, so long as they are at least 18 years old, have good financial standing, and have no record of malpractice.
- Shareholder’s particulars (1 to 50 individuals or businesses). Shareholders may or may not serve as directors. Shareholders, local or foreign, are permitted to own 100% of the shares. Shares can be issued or transferred at any time following the incorporation.
- Company secretary information. You will have to appoint a qualified resident as company secretary. This step should be taken within six months following your company’s registration. Note that a company secretary should not be a sole shareholder or a director.
- Minimum of S$1 in paid-up capital. You may increase this amount following your incorporation.
- Company’s official registration address. This must be a local and physical address in Singapore. You may use a residential or business address, but not a P.O. box.
If you plan to hire a third-party service provider for your incorporation, you may be asked to send them following documents:
- Non-residents: a copy of passport and overseas residential address
- Citizens of Singapore: a copy of identity card from Singapore
- Shareholders of corporate entities: a copy of registration document
In case the documents are not in English, they must be submitted with a duly certified document of the translation.
Setting up a business in Singapore requires careful planning, understanding of share capital, and completion of necessary documents. Entrepreneurs should develop a solid business plan, determine the share capital structure, and provide required information such as company activities, constitution, director and shareholder details, company secretary information, paid-up capital, and a local registration address.