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Starting a business
in?Singapore
Why & How

Sahana Jayaprakash
Client relationship manager at?Osome,
certified accountant in Singapore

Starting a business in?Singapore
Agenda
3
1. Business in Singapore: pros and cons
2. How to incorporate: requirements, process,
costs
3. What can go wrong and how to?prepare for it
4. Q&A

Why Singapore
5
1. Simple and transparent regulations
2. Low Taxes
3. Great place to live

Simple and transparent regulations
6
No need to give up ownership and
managerial rights to locals
Same laws for local and foreign
companies
?????
Law
��

No need to give up ownership
and managerial rights
Example: Samosa Makers Pte. Ltd.
Owner: Indian Hired Nominee Director: Singaporean
Makes all decisions,?
Manages the company?
Keeps all the profits
Makes sure the regulatory
requirements are complied with
Enjoys a samosa from time to time :)

Same laws for local
and foreign companies
? Same tax rates for local and foreign companies (unlike 10% difference in India)
? Same compliance and regulatory requirements
? Same penalties and fines for non compliance

Low Taxes
10
One-tier corporate
tax system
0�C22%
personal tax
4�C17%
corporate tax
0% tax on dividends
and capital gains
Tax exemptions
for startups

One-tier corporate tax system
One-tier tax system
Company pays tax only once: on its
income or profit. ?
No additional taxes on?dividends.
Two-tier tax system
First tax �C on a net profit
Additional tax �C on dividends

Example
Samosa Makers Pte. Ltd. made a profit of ?50,00,000
India (2-tier tax)
30% tax on profit
Dividends
15% tax on dividends
Total tax:
?15,00,000
?35,00,000
?5,25,000
?20,25,000
Singapore (1-tier tax)
8,08% tax on profit ?4,04,000
Total tax: ?4,04,000
Difference: ?16,21,000

0�C22% Personal Tax
There is no tax on the first S$20,000, and the maximum progressive tax rate is 22%
Example:
There are additional reliefs, e.g. if you have a dependent spouse or a child.
S$100,000Salary:
S$5,650Tax:

4�C17% effective corporate tax
Corporate tax rate is 17%, but there are tax exemptions for startups:
first S$100,000First 3 years:
first S$10,000After first 3 years:
next S$90,00
75%
75%
50%
Profit Exemption
S$25,000
S$2,500
S$45,000
Taxable
S$4,250
S$425
S$7,650
17% tax

0% Tax on Capital Gains and Dividends
Capital Gains you sell a share of the company for profit
Dividends company makes profit, shareholders distribute it among themselves
Both are not taxable

Great Place to Live
10
Half of a million
Indians live
in?Singapore
India is 4 hours away No Corruption Simple Immigration
Laws

Cons
10
High Competition Strict Laws Expensive

Summary: Why Singapore
5
1. Simple and transparent regulations
2. Low Taxes
3. Great place to live

How to Incorporate
How to Incorporate

How to Incorporate
5
1. Requirements
2. Process
3. Costs

Please meet ACRA
6
Accounting and Corporate Regulatory Authority
Main government organization for businesses.
�C Incorporates new companies
�C Makes rules and keeps compliance

Requirements: Documents
6
Passport Proof of Address

Requirements
6
? Company Name
? Nominee Director
? Corporate Secretary
? Registered Address
? Initial Capital

Process
6
1. Company Name �C check availability with ACRA
2. Appoint a nominee director
3. Gather required documents for all shareholders
4. Appoint a registered filing agent

Costs
6
Incorporation government fee S$315
Nominee Director for 1 year S$2000
Registered Address S$240
Employment Pass Application S$800
Dependent Pass Application S$400
Assistance with Bank Account S$200
+S$2000 security deposit

Summary: How to Incorporate
5
1. Requirements
2. Process
3. Costs

What can go wrong
What can go wrong?

What can go wrong
5
1. The name is taken
2. Shareholders are rejected by ACRA
3. Company is rejected by the bank
4. Delays and rejections of employment pass
5. Living and business costs are higher than
anticipated

Name is taken
6
Why it happens
1. Similar name is already in use ?
(e.g. Apple, Microsoft, Google)
2. Name is not desirable ?
(e.g. contains keywords like ��bank��)
What to do
1. You can send an appeal to ACRA and
wait for 14 days for approval
2. Choose another name :)

Shareholders are rejected by ACRA
6
Why it happens
Before incorporation ACRA performs
a?due diligence on all shareholders ?
(e.g. checks criminal records).
Any shareholder that is failed the check is
rejected of starting a company
What to do
Shareholders who do not clear the ?
due diligence cannot incorporate ?
in Singapore.
But there are cases where there is full
name match with actual perpetrators.
In?this case appeal can be filed.

Company is rejected by a bank
6
Why it happens
Bank rejects a customer if it has problems
credibility record or considered
as?��not??clean��.
What to do
Double-check that your credibility record
and your overseas bank account
are?clean.

Delays and rejections of employment pass
6
Why it happens
1. Officially that approval of employment
pass takes about 3 weeks.
2. However, most often the approval
takes a?up to 4 months.
What to do
1. Hire a nominee director for a minimum
of 6 months, to allow for such delay.
2. In the meantime operate
your?business from India remotely.

Living and business are more expensive ?
than you thought
6
Setup the business S$6000
Regulatory compliance S$2000 per year
Average salary of admin staff S$2000 per month
3-bedroom apartment S$3000 per month
Food and entertainment Bangalore prices �� 2

Summary: What can go wrong
5
1. The name is taken
2. Shareholders are rejected by ACRA
3. Company is rejected by the bank
4. Delays and rejections of employment pass
5. Living and business costs are higher than
anticipated

How Osome can help
How Osome can help?

What is Osome
Starting a business in?Singapore 6

How Osome can help
6
1. Free consultations 27/7
2. No need to come to Singapore
3. All incorporation services, including nominee director
4. Pre-approve bank account with OCBC

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How to start a business in Singapore from India

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