How to Incorporate Your Business in Singapore in 2023
Incorporating a company in Singapore allows businesses to be established as entities and for them to operate as separate entities from their owners. There are several benefits to incorporating in Singapore, e.g., Singapore’s business -friendly laws, strong intellectual property protections, and stable political and economic conditions. Below we outline the process of incorporating a company in Singapore, provide additional details about each of these steps, and some things to consider beyond the incorporation process.
How to Incorporate a Company in Singapore
Step 1 – Choose a Business Structure:
There are three main types of entities that businesses in Singapore have the option of incorporating under: sole proprietorships, partnerships, and limited liability companies (LLCs). Each type of business structure has its own advantages and disadvantages. It is important to choose the one that best meets the needs of your business.
- Sole proprietorships are the simplest and most straightforward type of business. A sole proprietorships are suitable for businesses that are owned and operated by a single individual.
- Partnerships are businesses owned and operated by two or more individuals. These are suitable for businesses in which owners share the risk and responsibilities of ownership.
- LLCs are more complex. In Singapore it is possible to incorporate as a Limited Liability Partnership (LLP) or a Company.
- LLPs have two types of partners: a general partner who is personally liable for the company’s debts and losses and a limited partner who has limited liability, i.e. a partner who is not personally responsible for the debts and losses of the company.
- Companies will typically be incorporated as either a Pte or Ltd. Ownership of a company is divide among its shareholders. Shareholders have limited liability and are not personally responsible for the debts incurred by the company. The tradeoff for limited liability is that shareholders do not exercise the same level of control over a company as owners in other business structures.
Step 2 – Select a Company Name:
Your company name must be entirely unique, i.e., it cannot be identical or similar to any existing company names. When choosing your name, be sure it does not infringe on any trademarks or intellectual property rights.
When deciding on a name, it is helpful to think about the nature of your business and the image that you want to project. A good company name should be memorable, descriptive, and easy to pronounce and spell. It should also be consistent with the branding and marketing strategy of your business.
Step 3 – Prepare Necessary Documents
Documents necessary for incorporation include articles of association, a memorandum of association, and a register of directors and shareholders.
- Articles of association – a legal document that sets out the rules and regulations that govern the internal management of the company.
- Memorandum of association – a legal document that outlines the relationship between the company and its members (i.e. the shareholders).
- Register of directors and shareholders – a record of the individuals responsible for managing and owning the company.
Step 4 – File Incorporation Documents
After the incorporation documents have been prepared, they must be filed with the Accounting and Corporate Regulatory Authority (ACRA) to formally incorporate the company. The incorporation process typically takes a few days to complete.
To file the incorporation documents, you will need to submit them online through the ACRA's Business Filing and Information System (BizFile+). You will also need to pay the incorporation fee. This fee will vary depending on the type of business structure you have chosen and the size of your company.
Step 5 – Obtain Necessary Licenses and Permits
To operate legally in Singapore, certain types of businesses require additional permits and licenses. Depending on the type of business you are operating. These can include industry specific licenses, such as food and beverage or retail, or permits activity specific permits like importing and exporting goods.
To obtain the necessary licenses and permits, contact the relevant government agencies and/or departments and provide them with the required documentation. This process can take several weeks to complete, so plan ahead and allow sufficient time.
- Business structure: As mentioned above, it is important to choose the right business structure for your company. This will depend on a variety of factors, including the size of your business, the nature of your operations, and your long-term goals.
- Shareholders: These are the owners of the business, and as such they have certain rights and responsibilities. Carefully consider the number and types of shareholders your company will have, as well as the distribution of ownership and control.
- Directors: Directors manage the business and make key decisions on behalf of the shareholders. It is important to choose directors who have the necessary skills and experience to lead your company effectively.
- Capital requirements: Most business structures require a minimum amount of paid-up capital, i.e., money that has been invested in the company by the shareholders. The amount required will depend on the type of business you are operating and the size of your operations.
- Additional financing: The required start-up capital will typically be much lower than the amount of capital your business will need going forward.
- Basic overhead costs like rent, salaries, and inventory. You will want to have sufficient capital not only to initially get secure these resources, you also want to ensure you have sufficient capital to pay these expenses during the early stage of your business.
- Capital to support growth and marketing endeavors. Financing for these types of expenses is something we specialize in providing to companies at
- Financial stability and viability. Having adequate capital can demonstrate to potential investors and partners that your company is financial stable and viable. Doing so will create new opportunities for valuable partnerships and more financing options for your company.
- Location: Another important is the physical location of your business. Singapore has an efficient transportation infrastructure, making it easy to access key markets and supply chains. The country is also home to a large and skilled workforce, which can help to support the growth and development of your business.
- Legal and regulatory requirements: Incorporating a company in Singapore involves complying with a range of legal and regulatory requirements. Important requirements include:
- Registering the company with the ACRA
- Obtaining necessary licenses and permits
- Complying with the requirements of the Companies Act and other relevant laws.
- Seek the advice of a legal professional to ensure that you are complying with all of the necessary requirements a business needs to meet when incorporating and operating in Singapore.
By following the steps outlined above and carefully considering additional considerations beyond incorporation, businesses can successfully incorporate in Singapore and take advantage of the country's business-friendly environment.