In the global economy, Singapore has a unique position. It serves as a key Asian market center for setting up a local company. Due to its constructed infrastructure, political stability, free-market principles, skilled workforce, English as the primary working language, and intellectual property rights protections, the city-state has long been regarded as a global commercial center. Singapore is frequently referred to as the ASEAN gateway, and it boasts one of the region’s lowest corporate tax rates.
#1 The ease with which a company may be established
In the Globe Bank’s yearly evaluation of 189 economies across the world, Singapore has consistently been named the best place to start a new business. Setting up a local company in Singapore is simpler and quicker than in many other countries that are considered commercial hubs. If all of the required criteria are fulfilled and the application is correctly submitted, the process takes just one day to complete. Anybody even foreigners may do the company registration Singapore process. The advent of an online system that enables you to submit your application forms online has simplified and expedited the process.
#2 A strong legal framework and a high degree of personal security
The political environment in Singapore is one of the most stable in Asia, giving new business start-ups and investors a strong feeling of security and comfort. Its judicial system has been praised as one of Asia’s most efficient, enacting anti-corruption laws so that investors may consider setting up a local company without fear of bureaucratic roadblocks.
Furthermore, Singapore maintains a continuously low crime rate and provides residents with a high degree of personal safety owing to strict law enforcement. In the event of a cross-border dispute, the company registration Singapore entity’s platform may rely on Singapore’s reputation as a world-class arbitration institution.
#3 Environment that is conducive to business
Singapore has a conducive business climate. The World Bank’s Doing Business Report, the World Economic Forum’s Global Competitiveness Report and Global Information Technology Report, and the Economist Intelligence Unit’s Country Forecasts Report have all praised and ranked Singapore’s business climate.
Singapore’s capabilities and infrastructure are of excellent quality, as shown by these rankings. As a consequence, the Singapore Ministry of Trade and Industry reports that the city-state has attracted hundreds of multinational corporations (MNCs), many of which have chosen Singapore as their Asia Pacific headquarters (MTI).
#4 Positioning and network of trade agreements
Because of its strategic position in Southeast Asia and closeness to surrounding developing countries, Singapore is home to the world’s top players in every sector. Through Singapore, you may easily communicate with other Asian countries. With regular incoming and outbound flights, air travel is also popular, making the company registration Singapore process more pleasant and convenient. Singapore has significant international connections with other nations in the areas of trade and industry.
Singapore’s network of FTAs has expanded to include 21 bilateral and regional FTAs, as well as 41 Investment Guarantee Agreements since the first ASEAN Free Trade Agreement (AFTA), was signed in 1993. Negotiations with other countries for free trade agreements are being facilitated. These agreements make cross-border trade and commerce simpler, as well as making it less costly for Singapore businesses to expand globally.
#5 A wide range of air connections
Singapore encourages trade by using a dynamic supply chain management system and a well-functioning logistics infrastructure. Singapore Changi International Airport serviced over 100 airlines serving 400 destinations in over 100 countries and territories as of February 2019. Changi Airport sees about 7,200 aircraft arrive or leave each week, with over 62.2 million people traveling through each year. It is also home to UPS and FedEx, two of the world’s biggest logistics businesses.
#6 Protection of intellectual property on a large scale
According to the World Economic Forum’s Global Competitiveness Report 2015–2016. Singapore has the best intellectual property protection, infrastructure, and incentives in Asia. It is also rated second in the world, after Finland and Luxembourg, who are tied for first place.
#7 A flourishing financial hub with easy cash availability
As of March 2016, Singapore has 124 commercial banks, 365 funds managers, and 531 licensees. It is not only Asia’s wealth management and financial hub, but it also contains the Singapore Exchange. It is the world’s fourth-largest foreign exchange trading center (SGX).
As a result, entrepreneurs may utilize a combination of private and commercial banking services to help their company registration Singapore entity grow at rates as low as 1% per year.
#8 Incentives for locating a corporate headquarters
Furthermore, the Economic Development Board (EDB) provides regional headquarters (RHQ) and international headquarters (IHQ) incentives. This is to encourage multinational companies to relocate their headquarters to Singapore. Companies with RHQ status pay a 15% tax rate on qualifying income generated in Singapore from headquarters activities and operations. Reduced tax rates, ranging from 0% to 10% are enjoyed by those that are given IHQ status.
Regional headquarters that use Singapore as a holding place for foreign intellectual property (IP) may claim a WDA. It will cover the cost of obtaining the IP.
#9 Foreign tax is exempt
Another benefit is that Singapore-based holding corporations or headquarters may easily repatriate earnings from directly owned overseas subsidiaries. Those whose foreign subsidiaries engage in significant economic activity but do not meet the criteria may apply for a customized exemption.
Due to Singapore’s adoption of a territorial taxation system, this is the case. One will be taxed once the income was brought back to Singapore. Furthermore, if the dividends are received from a nation with a headline corporation tax rate of at least 15%. If repatriated to Singapore then no tax is imposed on them. The exemption benefits the Singapore economy since some tax was paid in that nation.
#10 Personal tax structure that is appealing
The personal tax system in Singapore is progressive. The marginal rates vary from 0% to 22%. The framework enables inhabitants to benefit from a variety of tax breaks, lowering their effective payments.
The Not Ordinarily Resident (NOR) Scheme is also in place in Singapore. It offers five-year tax relief to qualified Singaporeans working in the city-state. Individuals working for a Singapore-based company must earn at least S$160,000 per year. They must spend at least 90 days per year on setting up a local company outside of Singapore. As a consequence, IRAS will not tax the person on income generated while on business trips outside of Singapore.
Set up your own company today
WLP Group assists entrepreneurs and international corporations in determining the best choices to make as they grow in Singapore. To get a head start on setting up a local company in Singapore. Read our advice on incorporation and employment licenses. We also offer corporate compliance and taxes. You may also get in touch with us to set up a consultation with one of our experts.