Singapore is an ideal alternative business destination for companies who wish to relocate out of foreign jurisdictions. It is a self-governing financial, commercial and shipping hub with robust regulations and a firm rule of law. Doing business in Singapore is easy. Its strengths lie in its high accounting and tax standards, which are aligned with international requirements. Filing obligations are also seamless and clear – English, after all, is the official language in Singapore – a key criterion for foreign businesses looking at potential relocation options.
Companies in Singapore enjoy a headline corporate tax rate of 17 per cent as well as a network of double tax agreements signed with over 80 countries. Singapore also grants generous tax incentives and tax breaks for the initial years of new businesses.
Factors to Consider Before Relocating to Singapore
As you evaluate and plan your move to Singapore, consider the following factors:
- Ease of establishing a banking relationship: Do you have sufficient help with transferring banking assets to Singapore?
- Ease of introducing stakeholders to your new business entity in Singapore: How will you onboard clients, suppliers and vendors to your new branding and processes?
- Ease of managing existing contracts: Will you have to terminate any longstanding contracts? Do your clients and suppliers require a renegotiation of contract terms?
- Managing business operations: How many staff will relocate to Singapore and do they require work passes? Do you have to move any plant and machinery from abroad, or will you be acquiring new ones in Singapore?
- Managing business assets: Do you have sufficient help moving your business’ equity holdings and intellectual property to Singapore?
Steps to Relocating Your Business to Singapore
Step 1: Choose a business structure in Singapore
There are three main options to moving your business to Singapore. You may either (i) create a parent company in Singapore for your foreign company, (ii) create a parent company overseas, (iii) turn your foreign company into a parent company or (iv) inward re-domiciliation.
- Create a parent company in Singapore
You may wish to establish a new Singapore company (ParentCoy) that will become the parent company of your foreign company (ForeignCoy). Next, set up another Singapore company (SGCoy) that will become the eventual operating company in the long-term after the transfer.
All SGCoy equities will be owned by ParentCoy initially, but the shareholding structure of SGCoy can be similar to that of ForeignCoy before the transfer. After the corporate structure is established, you can initiate a transfer of contracts, suppliers and assets from ForeignCoy to SGCoy.
Upon successful transfer, you may proceed to close the books of ForeignCoy as well as file for de-registration. ParentCoy can either continue to operate as a holding company with SGCoy as its subsidiary, or you can de-register ParentCoy and let SGCoy operate on its own.
- Create a parent company Overseas
This is similar to the above arrangements, except that ParentCoy is created in a foreign jurisdiction instead of Singapore. Similarly, you may de-register ParentCoy upon the completion of transfer.
- Turn your foreign company into a parent company
Instead of creating a new parent company, you may wish to turn ForeignCoy into a parent company of a new SGCoy. You may structure the new SGCoy the same way you have structured ForeignCoy.
- Inward Re-domiciliation
Alternatively, you may choose to transfer your company’s place of incorporation, a process called re-domiciliation. Since 2017, Singapore has allowed foreign corporate entities to transfer their registration to Singapore under its inward re-domiciliation regime. This allows you to relocate seamlessly while retaining your corporate history and branding.
- Create a parent company Overseas
Step 2: Apply for work visas in Singapore
It is necessary to acquire the right work visa before relocating and working in Singapore. Acquiring an Employment Pass (EP) or an EntrePass gives you the right to act as a local director for your company. You may also apply for permanent residency, which allows you to stay in Singapore for much longer.
Alternatively, if you do not wish to relocate to Singapore, you will need to appoint a nominee resident director in compliance with statutory requirements in Singapore.
Step 3: Transfer business assets and address liabilities
Next, you may begin resolving the liabilities of ForeignCoy in your overseas jurisdiction, or transfer them to SGCoy. You may also begin transferring business assets, such as contracts, intellectual property, cash, equity holdings, plant and machinery and inventory from ForeignCoy to SGCoy.
Step 4: De-register your foreign company
Upon the successful transfer of assets and liabilities to SGCoy, you may proceed to close the books of your foreign company as well as de-register from the company registrar of your foreign jurisdiction.
Step 5: Adhere to compliance requirements
Moving your company to Singapore does not end with setting up and transferring your assets. There are plenty of compliance requirements and checks involved to ensure you stay compliant with the law. For instance, you will be required to file corporate income taxes, prepare employees’ tax forms, hold annual general meetings and submit annual returns. For more information and guidance, you may wish to engage a local corporate services provider.
Engage a One-Stop Corporate Solutions Provider
To simplify your relocation process and compliance requirements, consider engaging a one-stop professional corporate services provider in Singapore that can provide you with all the corporate support and expertise you need.
At Corporate Services Singapore, we provide a comprehensive range of services from incorporation to keeping and maintaining statutory books and registers, to helping you meet the various statutory compliance deadlines. Besides leaving you with more time and resources to plan your move and focus on your core business, this ensures that your business never misses a submission or statutory filing.
Corporate Services Singapore offers a complete suite of solutions to ensure that your Singapore company runs smoothly from Day 1. To begin your relocation plan to Singapore or find out more, give us a call at 6602 8286 or email firstname.lastname@example.org to get started today.