- Cost Of Doing Business In Singapore
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Cost Of Doing Business In Singapore – All Corporate Corporate Business Secretarial Tax & Accounting Business Bank Account Work Visa & Immigration Payroll & HR Support
If you’re new to the Singapore business ecosystem and have been researching Singapore company formation, chances are you’ve come across a lot of details about what’s required and a lot of price ranges.
Cost Of Doing Business In Singapore
Let’s talk about what it takes to incorporate a company in Singapore before we talk about the costs associated with each element.
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For an overview of the incorporation process, see our company registration guide. Here, we will focus on the five minimum requirements to incorporate a private limited company in Singapore: one director, one secretary, one shareholder, a registered address and a minimum paid-up capital of $1.
1. Company Secretary – As specified in Section 171 of the Singapore Companies Act, you must appoint a qualified company secretary within 6 months of the incorporation of your company. If your company has only one director or shareholder, you will need to appoint a separate natural person to be the company secretary.
2. Appointment of Directors – To register your Singapore company, you will need at least one resident director who is either a citizen, a Singapore permanent resident or a person with a valid work card. If you are a non-resident company, if you do not have a local person to appoint a resident director, you can find a candidate yourself, use a director nomination service through professional corporate secretaries, or appoint Singapore-recruited staff as required by your company’s director. that suit your needs.
3. Shareholders – Singapore private limited companies can have a minimum of 1 and a maximum of 50 company shareholders. Shareholders can be an individual, another legal entity such as your BVI company, or a trust. 100% non-resident ownership is allowed for private limited companies in Singapore.
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4. Address of Registered Office – Can be any business or residential address in Singapore. PO boxes are not allowed.
5. Paid-up capital – The paid-up capital or share capital is $1, which is the minimum investment you need to start a company in Singapore. You always have the option to start with $1 and add at any time after joining.
As a Singapore citizen, you can incorporate your business by logging into the BizFile+ portal using your SingPass ID and going from there.
However, a non-resident entrepreneur without a SingPass ID will need to work with a corporate secretarial firm or a corporate service provider.
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If you already have a contact who has the professional knowledge to carry out all secretarial duties for your business, you can nominate them with permission.
For most of us, we may need to hire a professional company. Also, keep in mind that non-domiciled businesses and entrepreneurs should hire the services of a professional service provider. Why? Because you don’t have a Singpass ID to set up the company yourself!
The Companies Act stipulates that corporate secretaries carry out pre-registration of directors and shareholders before your company is incorporated. Each year, depending on your company’s risk profile, a corporate secretary is responsible for monitoring key company employees to prevent money laundering and counter terrorist financing. For example, Refinitiv World-Check Risk Intelligence would cost upwards of $8,000 to $10,000 per year.
To ensure the professionalism of secretarial firms in Singapore, the Accounting and Corporate Regulatory Authority (ACRA) requires firms to be registered as “Registered Filing Agents” where they must comply with legal guidelines and re-qualify every two years.
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Professional firms would be required to pay licenses costing $200 per year, undergo external audit of KYC (ie customer onboarding) processes and attend regular audits to ensure compliance.
Since a typical small and medium-sized business has 3-5 directors or shareholders, you can reasonably estimate that the cost of compliance is around $200 per company per year including licensing and professional examinations.
Company secretaries’ fees will vary depending on your needs (eg advice on the best tax-saving corporate structure, routine share structure changes, etc.) and the qualification levels of the service provider.
In Singapore, corporate secretaries can be hired by SAICSA after completing the required years of experience and passing professional examinations. The average salary for a mid-level corporate secretary with enough knowledge to manage annual compliance is around $3,500 per month. For seniors, a secretarial salary would reach $5,000 – $7,000 per month depending on the size of the company. If we assume that each company secretary will serve 100 clients per year (not to mention the appointment period!), it would be reasonable to estimate that the “cost” of professional knowledge is about $500 per year.
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This is the most correct. These are usually annual statements, EGM, special resolutions, change of directors or shareholders, etc. are the costs to pay, which would be between $50-$200. Other common services offered by corporate secretaries is providing the company’s stamp and seal, which would typically range from $100-$200.
By now, you should have a decent idea of what is added to the company registration cost! Considering the minimum necessary expenses of a suitable corporate secretarial firm doing the work, you can expect the cost of disruption to be in the range of $600-700 per company per year.
If you’ve shopped around enough, we’re sure you’ve seen a good range of prices, from $300 to $3,000. a Singaporean subsidiary of a US-listed company that can justify higher prices. At the other end of the spectrum, there are smaller but less organized companies that are focusing on service delivery, customer experience, or outsourcing your work to unfamiliar jurisdictions like Malaysia or India.
For a good balance between reliability and cost, we’d recommend the $800-$1,500 range as a starting point for businesses looking for good service and advice. This range is slightly more than the cost of the $700 suspension – On the one hand, it doesn’t break the bank, on the other, it’s a better guarantee of the quality of the work provided.
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This is a very common question among our clients, and it’s a fair one when evaluating all service-based businesses. While we would assume that contracted corporate service providers would do the basic annual filing, there are subtle but important differences to evaluate when choosing a service provider:
This is important but often overlooked. A great comparison is between retail banking and preferred and private banking. Sometimes, as a customer, you may not know the best financing or investment option until a dedicated banking relationship manager points it out or recommends it to you. Likewise, in the area of corporate services, salespeople with dedicated account manager support can provide better advice on the best business structure to suit your needs, advise on government aid opportunities, or provide relevant answers to your specific query.
Recently, there are more AI or application-based corporate service providers offering good value and cost savings to startups. However, on the one hand, you should expect more personal involvement in dealing with problems or government agencies. After all, you should go back to the reasons for outsourcing in the first place.
Have you ever been frustrated by a bank officer refusing to waive your annual credit card fee? The problem is that the bank is offering a commoditized product in the credit card space and is therefore trying to sell you “packages” but not offering real solutions to your problems. Unfortunately, it is similar in the corporate services sector.
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We have had frustrated customers who transfer from other providers because the former provider does not have the necessary flexibility to deal with customer queries. This varies from helping you open a bank account to advising on local licensing regulations. Lower-cost carriers tend to struggle with cases that require real problem-solving ability because they’re playing the volume game and need to promote the “packages” they have.
Finally, you may want to consider the additional support that a custom corporate services provider can provide. For example, facilitating entry into local networks or government bodies to get your business off the ground.
Most service providers in Singapore can only focus on core outsourcing functions, but after incorporating little or extra advice. For non-resident companies navigating a new jurisdiction and market, it can be helpful to connect with a local partner who can provide some assistance along the way.
Finally – Is your company worth joining a professional firm? We have business owner friends who ask this honest question.
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Our advice is consistent – If you’re a first-time business owner dipping your toes into the business world, it pays to be more cautious and try to DIY everything. But for most others, this is probably not good advice.
If you are considering the DIY option, the Singapore company registration fee charged by ACRA is S$315 if you do it through the BizFile+ portal.
If you are thinking of hiring a professional company: Although the cost of setting up a company in Singapore is higher (approx
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