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Remotely operated start up

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AussieRules
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Remotely operated start up

Postby AussieRules » Thu, 03 Aug 2017 3:24 pm

Hi Gents & Ladies,
I'd like if I may pick your brains.
I am in the process of setting up an online business, which I intend to operate remotely from a mix of locations (Asia EU & USA I have a complicated family life).
Research has suggested that it is easy set such a vehicle up in Singapore,. Whilst company formation is relatively easy I believe setting up a bank account (which is obviously pivotal to the business) can be more complex. Does anyone have knowledge or experience of this in Sing, as I believe in HK Bank Accounts are now not being offered to non residents.
Secondly, I have looked at some of the paperwork in advance from a Singapore Company formation company who have inserted some clauses that are very difficult (in the eyes of my lawter) to live with. Can anyone suggest a company formation agent who will not attempt this type of chicanery ?
Thirdly (which should probably be the first question tbh) is it still possible to run a Sing company from overseas without resident permits & EP and are the banks happy to open business acounts on that basis ?

Thanks

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ecureilx
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Re: Remotely operated start up

Postby ecureilx » Thu, 03 Aug 2017 3:53 pm

AussieRules wrote:Hi Gents & Ladies,
I'd like if I may pick your brains.
I am in the process of setting up an online business, which I intend to operate remotely from a mix of locations (Asia EU & USA I have a complicated family life).
Research has suggested that it is easy set such a vehicle up in Singapore,. Whilst company formation is relatively easy I believe setting up a bank account (which is obviously pivotal to the business) can be more complex. Does anyone have knowledge or experience of this in Sing, as I believe in HK Bank Accounts are now not being offered to non residents.
Secondly, I have looked at some of the paperwork in advance from a Singapore Company formation company who have inserted some clauses that are very difficult (in the eyes of my lawter) to live with. Can anyone suggest a company formation agent who will not attempt this type of chicanery ?
Thirdly (which should probably be the first question tbh) is it still possible to run a Sing company from overseas without resident permits & EP and are the banks happy to open business acounts on that basis ?

Thanks


you can read up on company incorporation etc, but should there by any hint of money laundering, Banks will throw you to the wolves so fast ... (or so they claim .. )

Nope, you can't open an account here.

Only option: Try HSBC Premier Vantage.

And for via a company, it's been discussed a lot here.

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Strong Eagle
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Re: Remotely operated start up

Postby Strong Eagle » Thu, 03 Aug 2017 9:55 pm

Here is the reality of the situation. In order to have a Singapore business entity (a private limited), you must have at least one "normally resident" director. If you have no one in Singapore willing to be your director, then you must rent one from one of the company formation outfits.

I assure you that there is no "chicanery", per se, although they may be trying to do their best to empty your wallet. Although people call these rented directors "temporary" or "nominee" or "resident", the fact is that a director is a director is a director... and that person is liable for all the acts of the company, both individually and corporately, both civil and criminal.

It used to be real easy to get a rented director... lots of CPA firms would have some retired 'uncle' that they would loan out to you for $1,500 or so... he didn't do anything, of course. But then, these 'uncles' started getting royally screwed because the companies they represented were into all sorts of illegal activities. Word has traveled fast in the CPA community, and you will have a very hard time finding a CPA who will still rent you a director without conditions. You can try, though.

Therefore, everyone of these companies that will provide you a director wants to crawl up your ass with a microscope to make sure that everything you are doing is squeaky clean and above board. They will want to be your bookkeeper and accountant to make sure your transactions are squeaky clean. They will want access to all bank account records to make sure there's not extra cash flowing in and out unaccounted for. They will want to look at your significant expense invoices, your payroll, your work permits, to make sure that you're not using them as vehicles to launder money. They want to file your annual tax returns and prepare your annual audit. Because it is their director that will bear the brunt of legal responsibility, should you turn out to be a shyster.

You, too, are at risk, with a rented director. She/he can do absolutely anything a director can do without your permission (and even if you are a non-resident director). You cannot write anything into your incorporation articles that would limit the powers and responsibilities of directors under the companies act. Therefore, a principal means of protection for you is a signed, undated letter of resignation... should your rented director go rogue, you date it and have evidence that he is not your director.

As for bank accounts, in theory, you can open a bank account, since the rented director files a directors resolution with a bank specifying who can draw on the account, draw limits, number of signatures, etc. You must be present in Singapore to open the account as you must sign the signature card in the presence of a bank officer. You must be present to sign the very real _paper_ paperwork to setup electronic banking. But again, in theory, you can readily open a bank account via your director and be made a signatory. As a matter of fact, if you are listed as a non-resident director at ACRA, you can do your own directors resolution.

The reality of the situation is much more complicated. The Monetary Authority of Singapore has already shut down several banks, and placed large fines on several more, for money laundering, including the notorious billion ringgit corruption scandal still unfolding in Malaysia. The banks are more jumpy than ants on a hot griddle.

Couple this with the fact that you are an unknown and that you will want to use electronic banking facilities, and you can understand the reluctance of the banks to want to handle your transactions, even if you have gobs of money stored in their vaults. It is a ludicrously easy way to launder dirty money... "income" from non-existent sales in countries that are very hard to audit... payments to "suppliers" that are buried in byzantine corporate relationships.

Your counterpoints to their fears might include the fact that your rented director company has already crawled up your ass, and if you are already running a legitimate business elsewhere, your willingness to be audited and reviewed so that they can be comfortable with you. Your job is to convince them you are clean and that your business is legitimate and real.

Finally, with respect to your questions about running a company without an EP, the short answer is that you don't need a work permit of any kind because you are not resident. And non-resident directors and managers are legal. However, because you are non-resident, you face a relatively heavy (at least from the Singapore perspective) tax situation. Compensation paid to non-resident directors must have 22 percent of the gross income withheld and passed onto IRAS before you receive your pay.

This also holds true if you are not a director but are providing principal management services for the company. The tax theory (and as embodied in most tax treaties) is that since you are an officer or manager of a Singapore based entity, then you are considered to be earning your income in Singapore. The automatic withholding just helps you be a nice legal guy.

That's my $0.02.

AussieRules
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Re: Remotely operated start up

Postby AussieRules » Fri, 04 Aug 2017 3:33 am

thanks for the info, you given me some valuable advice

PNGMK
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Re: Remotely operated start up

Postby PNGMK » Fri, 04 Aug 2017 8:09 am

AussieRules wrote:thanks for the info, you given me some valuable advice


I would look at other countries - the UAE is advertising company set ups including bank accounts for $4000 or so and they have no income tax.
I have gay, black, Asian friends and then JR8.

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Re: Remotely operated start up

Postby bgd » Fri, 04 Aug 2017 10:46 am

Have a look at Estonia E-Residency - link below - sounds like just what you need.

https://e-estonia.com/solutions/e-identity/e-residency

AussieRules
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Re: Remotely operated start up

Postby AussieRules » Fri, 04 Aug 2017 4:23 pm

Re- UAE, I've looked at that, the issue is that you're only allowed to use that vehicle for trade outside the UAE ( I believe the most favourable Emirate is Ras Al Kamina), one of the target markets for my product is UAE so I had to rule that option out, but thanks for the contribution.

cattleherder
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Re: Remotely operated start up

Postby cattleherder » Sat, 12 Aug 2017 12:59 am

Hi AussieRules,

I am a naturalised Australian who ran a tech business remotely and just registered a business in Singapore (also remotely but plan to be there physically). Several things:

  • Aussie lawyers are absolutely clueless about anything overseas. It's just like lawyers in any other country, they are 100% confident the laws of their country apply worldwide. Maybe not confident, but they will not hesitate to charge you money while applying this kind of logic. Waste of money. And ignore what the accountants say about overseas taxation, they know nothing either.
  • Like others said, a nominee director is fine. It's not just a Singapore thing either.
  • Hong Kong offers similar incorporation opportunities but it is slightly cheaper. On the downside, it is slightly farther from Oz. Once in a while, you may need to fly there physically, so Singapore is handier. Also, nobody knows if one day the mainland will decide to change something drastically.
  • Some accounting companies have partnerships with banks. But they may be reluctant to deal with you if you'll be running it remotely. (That is not the case in Hong Kong, BTW. At least it was not a decade ago.)

    Another option is to contact banks present in Australia. I know that ANZ had some operations but I think it's no longer the case. Maybe HSBC or DBS can work, I don't know.
  • If you're after an institutional investment, the offshore registration is out of question.
  • I am happy with the accounting firm I picked but if it's against the rules, I won't advertise it. I'll just say that the ratings in Google helped me find them.

Feel free to PM for more info. Good luck!

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Strong Eagle
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Re: Remotely operated start up

Postby Strong Eagle » Sat, 12 Aug 2017 1:25 am

I am happy with the accounting firm I picked but if it's against the rules, I won't advertise it. I'll just say that the ratings in Google helped me find them.


You are free to post your recommendations as you are not shilling for the company.

cattleherder
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Re: Remotely operated start up

Postby cattleherder » Sat, 12 Aug 2017 2:03 am

Strong Eagle wrote:
I am happy with the accounting firm I picked but if it's against the rules, I won't advertise it. I'll just say that the ratings in Google helped me find them.


You are free to post your recommendations as you are not shilling for the company.

Thanks. Not shilling, just being a happy customer :) .

In that case, it's 3E Accounting. They are generally affordable, have good packages for the registration services and are connected with suppliers you may need at some point (banks, lawyers, etc.). They are growing but not too big yet, the cofounders are in the cc list.

Note though that it's been only a month, so I can't comment whether they will keep the same standards over the years.

When shopping around, I picked several questions (some simple, other trickier) and looked at the responses.


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