Aside from corporate tax filing, you need to also nail down your GST filing as per the requirements of the law in Singapore. However, remember that you will only register for GST if your company’s annual turnover is higher than S$1 million. If your turnover is more than that, submit an application to the IRAS. If you have registered as a sole proprietor, you may not need to conduct annual audits or submit your financial statements. However, you are required to file your annual income return which includes the revenue and profits of your business.
Starting an Exempt Private Company in Singapore: Benefits and Process
- Your local director may not necessarily partake in all decisions, but they should still satisfy the government requirement such as minimum salary, holding the annual general meeting, and so on.
- In Singapore, all businesses are generally required to register with the Accounting and Corporate Regulatory Authority (ACRA).
- Separately, if a business wishes to export its goods out of Singapore, it must also go through the above process to obtain an export permit.
That being said, there are certain obligations that businesses must meet in order to operate in Singapore. A business’ FYE is determined entirely by the business accounting for uncollectible accounts receivable itself based on what best suits its business operations. That being said, should you wish to change your business’ FYE, the change must be filed with ACRA . Following which, the Inland Revenue Authority of Singapore (IRAS) will update its records based on the information filed with ACRA. A sole proprietorship or general partnership is Singapore’s most basic form of business structure.
This also ensures no individuals are personally liable for any debts incurred. Some examples could be a person who runs personal accountant a small convenience store in front of his or her house, an individual providing services like a freelancer, or even an artisan. Note that a sole proprietorship is not a separate legal entity from its individual owners, even if it is licensed and registered as a business or similar legal entity. This means there is unlimited liability to taxes and debts from the business and the individual who runs it.
Foreigners registering a business in Singapore
If you are applying to set up a private limited company, a foreigner will also need to apply for an EntrePass from the Ministry of Manpower Singapore if he or she wishes to act as a local director of the company. In other words, an LLP is a business with partners but gives owners the ability to function as a separate legal entity. In Singapore, there are 4 business structures that are widely used by all businesses. Learn more about what you need to register your business, depending on the business structure you’ve chosen at Step 1.
Businesses Tax System
A ‘business’ refers to any activity that is carried out on a continual basis for the purpose of profit. This includes online or web-based businesses such as running online stores as well as home-based businesses, such as those selling home-baked goods. Under section 5 of the Business Names Registration Act (BNRA), all types of businesses except those exempted (see below) must be registered with the Accounting and Corporate Regulatory Authority (ACRA).
Private Limited Company
For instance, a skilled worker who earns at least $3000 a month requires an “S” pass, whereas other workers may only require a normal work pass. In that respect, do refer to this detailed step-by-step guide for hiring employees in Singapore. Alternatively, you should approach an employment lawyer for further advice. Finally, as a business owner, you would likely have to hire employees. As an employer, the broad considerations you would likely have to take into account are largely detailed in the Employment Act – the key legislation governing the employer-employee relationship. It is also worth noting that start-ups in Singapore have access to a wide array of government grants.
If you intend to expand your business and would like to raise capital more easily in the future, you may wish to incorporate a Singapore company. This would be a separate legal entity which would similarly allow you to limit your liabilities. If you are a foreign entrepreneur residing in Singapore and wish to start and operate a business here, you can apply for an Entrepreneur Pass (EntrePass) from the Ministry of Manpower (MOM). Eligible foreign entrepreneurs can apply for the EntrePass before incorporating a company with ACRA, or within 6 months after incorporating a company with ACRA. For more information on what businesses are eligible and the application requirements, you can visit MOM’s website here. On the other hand, if you are a company, you will be taxed based on corporate tax rates.
You may refer to our how to recruit volunteers for a non profit organization other article for more examples of such government grants for start-ups. If the business unfortunately has to close down, there are some requirements on closing a business that may be applicable. This is unless you have incorporated a company, as company registrations do not expire.