How to Register a Company in Singapore | Step-by-Step Guide | Company Formation Singapore
Are you looking to register a company in Singapore?
Having one of the lowest coporate tax rates in the world – 17% – Singapore is the go-to-destination for business around the world looking for a base of operations in Asia. Therefore, at WLP Group, our consultants have written several tips for business owners during the process of company formation Singapore.
In this guide, we will guide you through how to register a company in Singapore, including registering your company for GST and more. For a free Singapore company registration consultation, contact us at email@example.com.
GST Registration – Company Formation Singapore
If my newly formed and incorporated company’s annual revenue is less than S$1 million, should I register GST for my company?
GST is a broad-based consumption tax levied on the import of goods (collected by Singapore Customs), as well as most of the supplies of goods and services in Singapore. Export of goods and international services are zero-rated. The only exemptions are for the sales and leases of residential properties and the provision of most financial services. Some countries recognized GST as the Value Added Tax (VAT).
It is compulsory for Singapore Companies to register for GST when their turnover exceeds S$1 million per year. Likewise, newly formed companies that do not exceed S$1 million in turnover may opt for voluntarily GST registration.
Upon GST registration, businesses must charge GST at the prevailing rate. The GST that business charge and collect is known as output tax, which has to be paid to IRAS. GST incurred on business purchases/expenses (including import of goods) are known as input tax. Businesses can claim input tax if it satisfied the conditions for claiming. This credit mechanism ascertains that only the value added is taxed at each stage of a supply chain.
A GST-registered business will be required to submit GST return to IRAS at the end of each prescribed accounting period. The business will report its output tax and input tax for that prescribed accounting period in the GST return. The difference between output tax and input tax is the net GST payable to or refundable from IRAS.
In the event that you are not a GST-registered business, you cannot claim the GST incurred on your purchases. You should not charge your customer for GST as well.
Some considerations below before you register for GST:
1) Responsibilities – Once registered, you are a GST collecting agent of the government. This means that there are responsibilities that you need to fulfill and adhere to. Complying with these responsibilities will increase your administrative costs.
2) Suppliers’ Profile
3) Customers’ Profile
4) Type of sales which you make
5) Your pricing strategy after GST registration
Do I need to register for the GST during the process of company formation Singapore?
If that’s the question that is still bothering you, feel free to contact our friendly consultant for FREE consultation today. While we have written several useful tips and tricks for new local business owners, the process of company formation Singapore is complicated.
ACRA – Annual Filing Requirements for Companies – How to Register a Company in Singapore
All newly registered and formed companies in Singapore must stay in compliance with Singapore law. Annually, a company has to file the two main agencies:
ACRA: The Accounting and Corporate Regulatory Authority
IRAS: The Inland Revenue Authority of Singapore
Filing with ACRA – The Accounting and Corporate Regulatory Authority
Annual General Meeting (AGM)
All private limited companies is going through the company formation Singapore process are required to file their AGM and AR on a yearly basis. This is required, even if the Company is dormant or inactive for the financial year. There will be legal consequences should the Company fails to file their AGM/ AR within the stipulated timeline.
A Singapore incorporated company is required to hold its Annual General Meeting (AGM) once every calendar year whereby it’s financial statements are presented to its shareholders for review and clarify their queries on the business.
AGMs are commonly held in the following ways:
– Physical meeting of all the shareholders
– Through written resolutions
During the AGM, other than the Company’s financial, the following matters are also to be discussed during the meeting:
- Dividend pay-outs to shareholders of formed company in Singapore
- Appointment of directors/auditors
- Remuneration for senior executives and directors
- Consideration of accounts and balance sheets
Annual Return (AR) Filing
Under the Companies Act, all businesses, that have completed the company formation Singapore process and incorporated their business, are required to file their annual returns within one month upon the AGM stated date. Should the Company requires more time to do their annual filing, a one-time extension of due dates are available for up to two months. Failure to file on a timely manner may result in legal actions and penalties.
The annual return is an electronic form set by ACRA to update the agency of the Company particulars such as:
- Company Name
- Registered address
- Principle activities
- Shares Details
- Information of Officers and Shareholders
- Dates of Annual General Meeting (if applicable)
- Financial statements in XBRL format (if applicable)
Using HDB/ Private Residential Property as Registered Business Address – How to Register a Company in Singapore (without a business address)
Don’t have a corporate business address? When forming a company in Singapore, you will need to register a company with an address (of your newly formed company). However, in the case that you have just started and would like to keep overheads low, you can register a company in Singapore without a business address!
However, there are strict rules and regulations relating with the process of company formation Singapore that you will need to follow.
Home Office Scheme
A Singapore Registered Entity is allowed to make use of their personal residential properties (HDB/ Private Home) as their registered business address as long as the Home Office regulations and guidelines are satisfied and the use of residential address does not affect the company’s neighbours in a negative manner.
Company Formation Singapore Requirements
- Applicant of new business must be 18 years of age or above
- The Applicant has to be the flat owner, legal occupier, or tenant of the flat, at the point of time when when the owner is incorporating a business to register a company in Singapore
- The property has to be primarily used as a place of residence, with business operations as the secondary purpose, when the owner is filling up the form to register a company in Singapore
- Does not apply for Society
Your business operations in the property must not and not allowed to:
- Produce noise, smoke, odour, chemical/ liquid waste, or dust
- Be illegal
- Cause heavy human or vehicular traffic to the neighborhood
- Cause annoyance or disturbance to the residents or public
- Retail of physical goods in or around the flat
- Display any signage, advertisements, posters, etc
Home Office Scheme – Permitted Businesses
- Accountancy services
- Architectural services
- Consultancy services (business, engineering, IT, management or education)
- Design/Advertising services
- Insurance/Financial planning services
- Real estate agencies
- Technology based and knowledge intensive businesses
- Trading office
Home Office Scheme – Non-Permitted Businesses
- Beauty, hair dressing or massage therapy services
- Contractors Business
- Car trading business
- Card reading/palm reading or fortune telling in any form
- Clinics and pharmacies (e.g. dental, medical, veterinary)
- Commercial school (e.g. dance, music, language, tuition centre)
- Courier business
- Classes on dress-making and embroidery
- Employment agency
- Funeral chapels or homes
- Maid agency
- Manufacturing, preparation or processing of any products and goods
- Money lending businesses
- Repair activities (e.g. household appliances, electrical products, footwear, etc.)
- Sales/marketing that involves conducting seminars and talks for large number of customers
- Shops and any form of retail activity, including pet shops
For more information on how to register a company in Singapore, contact us now at +65 6493 2970 to find out how we can assist you in the application of Home Office Scheme and company formation in Singapore!