1. Doing Business In Singapore 2008

2. Introduction Geography Population
Singapore’s strategic location at the southern tip of the
Malaysian peninsula has ensured its importance, which is greater than its size might seems to justify.
Singapore consists of Singapore island and 63 islets within its territorial water.
The Central Business District spreads from the central and southern parts of Singapore.
Population
Resident population of 3.58 million in June 2007, of
Singapore citizens and permanent residents
Total population : 4.59 Million

3. Introduction Political System Languages Currency
Singapore is a republic with a parliamentary system of
government, with a written constitution to provide for the
organs of the state, namely the executive, the legislature
and the judiciary.
Languages
Official languages are Malay, Chinese, Tamil and English.
Currency
The monetary unit used in the Singapore dollar (S$) which is divided into 100 cents.

4. Reasons for doing business in Singapore
Strategic Location
Access to unlimited markets
Pro – business environment
Nucleus for talents
Educated workforce
Opportunities to innovate

5. Different types of business entities
Sole Proprietorship
Partnership
Private Limited Companies
Exempted Private Companies
Public Companies
Branches of Foreign companies

6. Sole Proprietorship An individual carrying on business on his
own behalf.
Simplest and most flexible business structure.
It is not a separate legal entity.
Sole proprietor is liable for the debts of the business.

7. Partnership Defined under the Partnership Act(Cap.391)
as a relationship that subsists between
person carrying on business in common
with a view of profit.
Minimum of 2 partners and maximum of 20
partners

8. Private Limited Companies
A private company is one which has a small
group of no more than 50 shareholders.

9. Exempted Private Companies
This is a private company
Has not more than 20 shareholder and none of the shareholders is a corporation or that is wholly owned by the Government and which the Minister, in the national interest, declares by notification in the Gazette to be an exempt private company.

10. Public Companies Public Company limited by shares
A local incorporated company in which the
number of shareholders can be more than 50.
The company may raise capital by offering shares and debentures to the public.
Must register a prospectus with the Monetary Authority of Singapore before making any public offer of shares and debentures.

11. Branches of Foreign Companies
Instead of incorporating a local company to conduct
business, some foreign companies may choose to register
Singapore branch under the Companies Act(Cap.50).
A Singapore branch of foreign company is part of the same
legal entity as the foreign company at its head office and
branches of the foreign company in other parts of the
world.

12. Representative Office
A temporary establishment for foreign
companies to assess the business
environment in Singapore before making
business decision.
To undertake promotional and liaison activities on behalf of head office or overseas branches.
May not be engage in any trading or business.
Usually manufacturing, trade logistics and trade-related services sectors.

13. Operational Headquarter
Companies using Singapore as a base to
conduct HQ management activities.
Regional Headquarters
International Headquarters
Operational Headquarters
Business Headquarters
Manufacturing Headquarters

14. Register a Business ACRA Accounting and Corporate Regulatory Authority
To register business entities and public
accountant.
To ensure compliance with legal requirements.
To enforce and prosecute offenders.
To provide information on registered entities.

15. LIMITED LIABILITY PARTNERSHIP
Any on person who wants to carry on business for
the purpose of gain (profit) must register a
business, company or a limited liability partnership
in Singapore before carrying out such business
ACRA
BUSINESS
COMPANY
LIMITED LIABILITY PARTNERSHIP

16. Register a Business For Local Sole Proprietor or Partnership
Log into to submit an online transaction to apply for a new business.
Engage the services of a professional firm (lawyers, accountants or chartered secretaries) or service bureau (DP Bureau) for assistance in submitting the online application to register a new business.
Call at ACRA in person to submit the online transaction at the BizFile Kiosks.

17. Register a Business For Foreigners
Foreigner who wishes to engage in any business,
profession, occupation or form of paid employment
in Singapore must apply for an Employment Pass.

18. Register a Business
A successful applicant will be issued with an Approval-In-
Principle letter to enable him/her to register the business
with ACRA.
Upon receipt of the Certificate of Registration from
ACRA, the applicant needs to send/fax a copy of
the certificate and the Approval-In-Principle letter
to the Employment Pass Department for the
processing of his/her Employment Pass.

19. Incorporating a local company
Any person who wants to incorporate a local company may engage a professional firm or service bureau to assist him in the filing of the application for incorporation via Bizfile.
A company can also be incorporated by the directors themselves. (For convenience, we call this process “self-incorporation”.) For self-incorporation cases, the proposed directors, secretary and subscribers must all be Singapore NRIC holders.

20. Incorporating a local company
Requirements:
Any person above the age of 21 years can incorporate a local company. A company may have only one director who must be “ordinarily resident in Singapore” i.e. a Singaporean Citizen, a Singaporean Permanent Resident, a person who has been issued an EntrePass/Approval-In-Principle letter or a Dependant Pass.
A foreigner who wishes to act as a local director of a company can apply for an EntrePass or Approval-In-Principle letter from the Work Pass Division of the Ministry of Manpower (MOM) under the EntrePass Scheme.

21. Register a Foreign Company
Any person who wishes to register a branch of a foreign company is advised to engage a professional, e.g. a lawyer or an accountant to assist him in the preparation and filing of the application for registration via Bizfile.

22. Register a Foreign Company
The Companies Act requires a foreign company to appoint two local agents in Singapore to act on behalf of the company. The agents must be ordinarily resident in Singapore i.e. a Singaporean Citizen, a Singaporean Permanent Resident, or a person who has been issued an EntrePass/Approval-In-Principleletter/Dependant Pass. A foreigner who wishes to act as a local agent of a foreign company can apply for an EntrePass or Approval-In-Principle letter from the Work Pass Division of the Ministry of Manpower (MOM).

23. Approvals, Licenses and Permits
Certain business in Singapore are subjected to
further regulatory control by other government
agencies in Singapore.
Certain licenses and approvals need to be obtain
before the relevant business activities can commence.
Finance Companies
Insurance Companies
Travel Agents
Private Schools
More information,

24. Audit and Accounting Requirements
All businesses are required to maintain a proper
books of account for audit and taxation purposes.
For Companies, directors are required under the
Companies Act to appoint a firm of auditors within
3 months of incorporation.
For Representative Offices, partnerships, sole
proprietorships, LLPs, there are no requirements
to have accounts audited.

25. Promoting Foreign Investment
Economic Development Board
The leading agency responsible for planning and
executing strategies to sustain Singapore’s
attractiveness as a global hub for business and
investment. Work closely with other agencies to
promote innovation and develop humans, intellectual,
financial and cultural capital in Singapore. I

26. Promoting Foreign Investment
International Enterprise Singapore
Promotes Singapore as a hub for Small and
Medium-sized companies by attracting enterprises from
other countries to be based in Singapore, so that they
can collaborate with international Singapore companies
to venture into the region.

27. Promoting Foreign Investment
Jurong Town Corporation
Leading provider of industrial spare solutions and
specialized parks for various industries.
Monetary Authority of Singapore
Regulates all elements of monetary, banking and
financial aspects of Singapore and oversees a
wide range of tax incentives specifically for
financial sector.

28. Taxation Taxes are used to develop Singapore into a
stronger community, a better environment and
a more vibrant economy.
Main objectives of tax policy
Revenue Rising
A substantial source of funding for government operations.
Promotion of Economic & Social Goals
Influence behavior towards desirable social and economic goals. To encourage mechanization and automation, the government allows accelerated capital allowance for most assets used for business purposes.

29. Corporate Tax Taxed based on
Income accruing in or derived from Singapore
Income received in Singapore from outside
Singapore
Assessed Period
On a preceding year basis, generally refers to the financial year ending in the year preceding the YA
Example: Company A accounts are prepared up to 31 December each. The basis period for each YA is the preceding calendar year ended 31 December. Thus a company’s basis period for YA is from 1 January 2007 to 31 December 2007

30. Tax rates and tax exemption for 2008
Corporate Tax
A company is taxed on a flat rate on its chargeable
income regardless of whether it is a local or foreign
company.
Tax rates and tax exemption for 2008
Tax Rate
Tax exemption
18%
Effective 2008, partial tax exemption is given to companies on a normal chargeable income (excl. Singapore franked dividends) of up to $300,000 as follows
Exempted amount
First 75%
Next 50%

31. Corporate Tax Tax exemption scheme for new start-up companies
was introduced in YA 2005 to support
entrepreneurship and to help our local enterprises
grow.
Tax exemption for new start-up companies on chargeable income up to $300,000
Exempt amount
First $100,000
@100%
= $100,000
Next $200,000
@50%
=$100,000
Total $300,000
$200,000

32. Partnership Partnership does not pay income tax on the income
earned by the partnership. Each partner will be
taxed on his share of the income from the partnership.
If the partner is an individual, his share of income from
the partnership will be taxed based on his personal
income tax.
If the partner is a company, its share of income will be
taxed based on the tax rate for the companies

33. Limited Liability Partnership (LLP)
LLP will not be chargeable to tax at the entity
level instead, each partner will be taxed on his
share of income from LLP.
If the partner is an individual, his share of income from LLP will be taxed based on his personal income taxes.
If the partner is a company, its share of income from the LLP will be taxed based on the tax rate for companies.

34. Tax Treaties An avoidance of Double Taxation Agreement
between Singapore and another country serves to
prevent double taxation of income earned in one
country by a resident of another country.
Makes clear the taxing rights between Singapore and her treaty partner on different types of incomes arising from cross-border economic activities between the two countries.
Provides for reduction or exemption of tax on certain types of incomes.

35. Tax Treaties Comprehensive Avoidance of Double Taxation
Agreements generally cover all types of income.
Limited treaties cover only income from shipping
and/or air transport.
Treaties which are signed but not ratified are
either comprehensive agreements or limited
treaties which are not ratified and therefore do not
have force of law.
Refer to appendix 1 for countries that Singapore has tax treaties with

36. Individual
All individual who earned an income in Singapore are subjected to taxation and need to declare all sources of income.
The amount of income tax need to pay depends on how much is being earned and whether the individual is a tax resident or non resident.
Tax Resident – Singaporeans, Singapore Permanent Resident or who stayed or worked in Singapore for more than 183 days or more in the year preceding the YA.

37. Individual
Non – Resident – Foreigner who stayed or worked in Singapore for less than 183 days in the previous year or who is the director of a company.
Non – Resident, employment income is taxed at 15% or the resident rate, whichever gives rise to a higher tax amount. Director fees, consultant fees and all other income are taxed at 20%.

38. Other sources of taxable Incomes
Taxable Other Incomes
Rent and Net Annual Value from property
Rent received from letting of a property in Singapore.
Example : Rental income includes rent of premises, maintenance, furniture and fittings
Gross rent - Total allowance expenses = Net Taxable Rent
Royalty is the income received from the right to use.
Example : Copyrights, patents, trademarks and etc.
Withdrawal from Supplementary Retirement Scheme is taxable and the amount being taxed will depend on the time of withdrawal.

39. Other sources of taxable Incomes
Taxable Other Incomes
Charge refers to income received under a deed or court order in Singapore
Example : Alimony/maintenance payments
Income from separation deed or order
Dividends are distribution by a company to its shareholders
Example : Returns on shareholder’s capital that maybe pay in cash or company’s shares
Employment income are gains or profit earned from employment
Example : Salary, bonus, director fees, commission and other employment income, gains from exercise of stock options and retirement or retrenchment benefits
Estate/ Trust Income received in Singapore from an estate under administrative or a trust
Income received from outside Singapore is taxable
Example :If it is received in Singapore through partnerships in Singapore.
Overseas employment is incidental to Singapore employment, as part of work in Singapore, there is a need to travel overseas
Employed outside Singapore on behalf of Singapore Government

40. Other Taxes Goods and Services Tax (GST)
A consumption tax levied on the import of goods
and nearly all supplies of goods and services in
Singapore.
Business must register for GST when their turnover exceeds $1mil per year and after the registration, must charge and account for the GST at prevailing rate. This is known as output tax.
The business can also claim the GST incurred on their
goods and services purchased if conditions are met. This is known as input tax.

41. Other Taxes
Stamp Duty
It is a tax on documents relating to properties and
shares and payable only on documents described
in the First Schedule to the Stamp Duties Act (Cap
312). Once the document is signed, the stamp duty must
be paid 14 days from the date of execution if document is
signed in Singapore and 30 days of its receipt in Singapore
if the document is signed overseas.

42. Other Taxes Estate Duty
It is a tax on the total market value of a person’s
assets (cash and non-cash) at the date of his
death. Common assets subjected to estate duty
Immovable Property
Market value of the immovable property in Singapore as at the date of death i
Example : Joint Tenancy, tenancy in common or in the deceased’s sole name.
Bank Accounts
Balances as at the date of death in the bank accounts are subjected to estate duty
Example : in deceased name or in joint name or by other persons in trust for the deceased
Public listed shares
Market values of the shares as at the date of the death
Items in Safe Deposit Box
Market value of the contents in the Safe Deposit Box as at date of death

43. Other Taxes Estate / Trust Income
The assets left behind by a deceased may continue to
produce income after his death.
Rental income from property
Dividends from shares declared after death
Interest income from bank/finance company
Share of profit from a partnership OR profit from a sole-proprietorship

44. Who can buy property in Singapore?
Buying HDB flat in Singapore
Citizenship
Must be a Singapore Citizen. The family nucleus must comprise at least another Singapore Citizen or Singapore Permanent Resident.
Age
Must be at least 21 years old at the time of application.
Family Nucleus
Must form a proper family nucleus under one of the following schemes:

45. Who can buy property in Singapore?
Family Nucleus
Public You, the applicant and;
- your spouse, and children (if any)
- your parents, and siblings (if any)
- your children under your legal custody
(for widowed/ divorced)
Fiance/Fiancee
Orphan

46. Who can buy property in Singapore?
Household Status
First-Timer Applicants
You and the essential family members listed in the
application for purchase of the flat must not:
be the owners of a flat bought direct from HDB, a DBSS flat or an Executive Condominium bought from the developer
have sold a flat bought direct from HDB, a DBSS flat or an Executive Condominium bought from the developer
have received the CPF Housing Grant for the purchase of an HDB resale flat;
have enjoyed other forms of housing subsidy (for example, enjoyed benefits under the Selective En bloc Redevelopment Scheme, privatisation of HUDC estate etc).

47. Who can buy property in Singapore?
Second-Timer applicants
You or the essential family members listed in your application
have owned/sold or are currently owners of
any HDB flat that was bought from HDB
any resale flat that was bought under the CPF Housing Grant Scheme; or any apartment under Design, Build and Sell Scheme or Executive Condominum from the developer
have enjoyed other forms of housing subsidy (for example, enjoyed benefits under the Selective En bloc Redevelopment Scheme, privatisation of HUDC estate etc).

48. Who can buy property in Singapore?
Income Ceiling
Buying a 3-room Premium, 4-room or bigger flat
Your gross monthly household income must not be more than $8,000.
If you are buying a flat with your extended family, your gross monthly household income must not be more than $12,000.
Buying a 3-room
Your gross monthly household income must not be more than $3,000.
Buying a 2-room
Your gross monthly household income must not be more than $2,000.

49. Who can buy property in Singapore?
Ownership / Interest in Property
You, your spouse, any occupiers listed in the Application
Form or their spouses must not own or dispose any other flat, house, building or land* or have an estate or interest at any time within 30 months before the date of application, or between the date of the application and the date of taking possession of the new flat.

50. Who can buy property in Singapore?
Stamp Duty / Fee
Stamp duty is a government tax payable by a buyer who
buys a property in Singapore.
Stamp duty payable is calculated on a scale :
1% on the first $180,000
2% on the next $180,000 and
3% thereafter
CPF savings may be used to pay the stamp duty.

51. Listing of local and foreign banks in Sinagapore Appendic 2
Banking in Singapore
Singapore is a leading financial centre in the
Asia Pacific region with more than 800
financial institutes offering a wide range of
products and services.
Listing of local and foreign banks in Sinagapore Appendic 2

52. Banking in Singapore
Commercial banks in Singapore are licensed under and
governed by the Banking Act.
Besides commercial banking, the banks may carry on any
other business which is regulated or authorized by MAS,
including financial advisory services, insurance broking and
capital market services.

53. Banking in Singapore FULL BANKS OFFSHORE BANKS MERCHANT BANKS
WHOLESALE BANKS
FINANCE COMPANIES

54. Banking in Singapore Full banks
May provide the whole range of banking business
approved under the Banking Act.There are currently 29 full
banks in Singapore. Five of them are locally- incorporated
entities under the three local banking groups, and one is a
locally incorporated subsidiary of a foreign bank.The
remaining 23 banks are branches of foreign-incorporated
banks. Six of the foreign banks operating in Singapore
have been awarded Qualifying Full Bank (QFB) privileges.

55. Banking in Singapore Full Banks
Foreign full banks with QFB privileges may operate a total
of 25 locations. They may also share ATMs among
themselves, and relocate their sub-branches freely. QFB
are allowed to negotiate with the local banks on a
commercial basis to let their credit card holders obtain cash
advances through the local bank's ATM networks.

56. Banking in Singapore Full Banks
QFBs may provide debit services through an EFTPOS
network, offer Supplementary Retirement Scheme and
CPF Investment Scheme accounts, and accept fixed
deposits under the CPF Investment Scheme and
Minimum Sum Scheme.

57. Banking in Singapore Offshore banks
Engage in the same activities as full and wholesale banks
for businesses transacted through their Asian Currency
Units (ACUs). The ACU is an accounting unit, which the
banks use to book all their foreign currency transactions
conducted in the Asian Dollar Market (ADM). The banks'
Singapore dollar transactions are separately booked in the
Domestic Banking Unit(DBU).

58. Banking in Singapore Offshore Banks
The scope of business transacted in offshore
banks' DBU has slightly more restrictions on
dealings with residents as compared with
wholesale banks. Offshore banks operate within
the Guidelines for Offshore Banks issued by
MAS. Under the banking liberalisation programme,
offshore banks were given greater flexibility
in Singapore dollar wholesale

59. Banking in Singapore Offshore Banks
Offshore banks had their Singapore dollar lending limit
raised to S$500 million. They are now allowed to engage in
Singapore dollar swaps in respect of proceeds arising from
the issue of Singapore dollar bonds managed or arranged
by them.
All offshore banks in Singapore, operate as
branches of foreign banks.

60. Banking in Singapore Merchants Banks
The typical activities of merchant banks include corporate
finance, underwriting of share and bond issues, mergers
and acquisitions,portfolio investment management,
Management consultancy and other fee-based activities.
Most merchant banks have, with MAS' approval,
established ACUs , through which they compete with
commercial banks in the Asian Dollar Market.

61. Banking in Singapore Merchants Banks
In their DBU, merchant banks may not accept sight or
deposits or borrow from the public. However they may
accept deposits or borrow from banks, finance companies,
shareholders and companies controlled by their
shareholders.

62. Banking in Singapore Finance Companies
Finance companies focus on providing small-scale
financing, including instalment credit for motor vehicles and
consumer durables, and mortgage loans for housing.
Finance companies may not offer deposit accounts which
is repayable on demand by cheque, draft or order. They
are licensed under and governed by the Finance
Companies Act.

63. Banking in Singapore Wholesale Banks
Wholesale banks may engage in the same range of
banking business as full banks, except that they do not
carry out Singapore Dollar retail banking activities. They
operate within the Guidelines for Operations of Wholesale
Banks issued by MAS.
All wholesale banks in Singapore, operate as branches of
foreign banks.

64. Banking in Singapore
Q : Do the individual need to be present for account opening procedures?
A: The specific requirements for opening a bank account vary from bank to bank. Most banks require that the bank signatories be personally present for the account opening witness by the bank staff.
For foreigners who are unable to attend, the sighting can
be arrange if the bank has branch in the overseas countries.

65. Banking in Singapore Q : How long does it take to open a bank account?
A : Bank Accounts are open immediately upon signing of bank papers and transferring of funds. Some bank services such as internet banking may take some time for activation

66. Banking in Singapore
Q : Can an individual open a multi-currency account?
A : Yes, bank allows clients to open multi-currency accounts.
Q : Can the funds be move freely between home country and Singapore?
A : Singapore has no currency / funds transfer restriction to any where in the world. Funds can move in and out freely.

67. Foreign Missions Accredited to Singapore
There are 63 resident foreign Embassies and
High Commissions, 41 foreign Consular posts
and 10 international Organizations in
Singapore.

68. Employment regulations
A foreigner who wishes to take up employment
or engage in business in Singapore must obtain
an employment or entrepreneur pass.

69. Employment regulations
Requirements for Employment Pass and
Dependent’s Pass
Recognized educational or technical qualification and earn a monthly salary of SGD2500.
Entrepreneur will need to submit business plan together with application.
An employment pass holder can apply dependent pass for
his/her spouse or children below 21 years of age to enable
them to stay with him/her in Singapore

70. Employment regulations
Terms and conditions for employees earning up to SGD1600 a month are subject to the Employment Act.
Other statutes dealing with workforce matters are the Industrial Relations Act, Trade Dispute Act and Workmen Compensation Act.

71. Employment regulations
A contract of service must be sign by employer and employee and would include (i) salary and working hours(ii) leave entitlement (iii) sick leave entitlement (iiii) notice period for termination of employment (v) details of contribution to CPF.
Trade Union, registered under the Trade Union Act which regulates the rights and liabilities and proper use of funds. Purpose is to promote a harmonious labour relations and strike free environment.