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Open a Sole Proprietorship on a DP and getting the LoC

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Maxman
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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby Maxman » Wed, 23 Sep 2015 2:59 pm

Just to share my experience / give the feedback that my application has been approved. Thanks for all your help and insights.

A couple of things to note: in this thread and other forums you see some people suggesting application can only be done via an employment agency or so. This is NOT correct.

I have written an email to MOM (mom_wpd@mom.gov.sg) and received the forms to fill out. Print, fill out, print the supporting documents they require (as mentioned in this thread) and mail it to them. You can ONLY mail it to them (so not online, not by dropping it off at the office).

It took exactly 4 weeks before I received the positive outcome.

I hope this helps people that are now in the same position as I was 4 weeks ago...

Cheers,
Max.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby smorris291 » Sat, 03 Oct 2015 2:23 pm

Max, question about the LoC part of the process. I am on a DP an have formed a sole proprietorship. But now it gets tricky...looks like LoC applications are now online only, but I cannot figure out how to do that. Did you email MOM for the forms and how to submit them?

Thanks!
Scott

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby Maxman » Wed, 07 Oct 2015 9:52 am

Hi Scott,

Yes, I did. Just briefly explain your situation and ask for the forms, they will send them electronically as a reply to your email.

A thing to think about is the time it takes vs the money you 'save'. The way I did it, will automatically become a 'paper/ hard copy admission of documents', which will take app. 4 - 5 weeks before they're processed. Not sure how long it will take if you use an agency, but I think it could be a lot faster. The costs are around 150 sgd I believe.

Hope this helps.

Cheers,
Max.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Tue, 20 Oct 2015 5:09 pm

Scott (smorris291), how did you go? Did you email for the forms as Max suggested?

I have just incorporated a company (which was quite easy with basic company knowledge) and being on DP wish to apply for my LOC to 'employ' myself. I could log in via the MOM EP online system but once logged in it did not give me a place to apply for the LOC. I'm thinking maybe because I myself am on DP and its not a usual method of applying for a LOC as its usually a local company itself doing so. I have emailed MOM and hope for the forms and a good outcome (since I had to spend $315 to register a company name and incorporate the company before doing so! It will be a waste of money if they don't approve my LOC).

Will advise my outcome, but I'm slightly confident I should be ok with getting it, but its not over til the fat lady sings!!

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Wed, 21 Oct 2015 5:46 pm

Oh dear, I don't know if I've done the wrong thing here. Rather than register a sole proprietor business I have incorporated a private limited company.

I emailed MOM to get those forms to apply manually for the LOC, which were forthcoming, then I notice she mentioned 'sole proprietor' in the email and undertaking letter. I asked for clarification if the undertaking letter she included was similarly relevant for a private company. She replied telling me that there has been a miscommunication and that I need to apply for an Entrepass to work for my company. What???

From what I understand from reading this thread (please correct me if I'm wrong), the Entrepass is only relevant if you are NOT ALREADY in the country on another pass and wish to enter the country to setup business. I am already here on a DP.

Have I stuffed up? Will my LOC be denied because I'm on a DP and registered a company?

Or is it going to be dependant on what person at MOM gets my mailed application? Are the email support personal at MOM 'less experienced' than the staff actually processing my application?

I couldn't find it but are some of you in this thread who got approved in the same boat? That is, DP, and got your letter of consent to work for your COMPANY (not sole proprietor business)?

I can't believe that I could work by registering a sole proprietorship business and get a LOC but can't doing the same for a company. Surely a company shows you are more serious? (I'm not claiming any of you that registered a sole proprietorship are not serious, I did consider it myself) but those less than serious generally WON'T register a company.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby Strong Eagle » Thu, 22 Oct 2015 2:22 am

All is not lost although things will be more complicated. In the end, a pte ltd might prove to be more beneficial than a SP.

First, Entrepass requirements have become so onerous that MOM is well aware that it is virtually impossible for any professional to set up a business. I have emailed them on this specific topic and received a reply that they will, on a case by case basis, entertain EP's and or LOC's for a pte ltd. The key is to have a real business plan and real experience and skills. Too many people try to scam MOM by going this route, so supporting documentation will be necessary.

Second, while you can register a pte ltd and be its shareholder, you cannot be a director since being a director is considered work by MOM and you can't work on a DP. Therefore, you will need to engage the services of a nominee director, a locally resident PR or SC, who will then file for your EP/LOC. Once you have your work permit, you then take over as managing director.

With a pte ltd I expect that you would more likely apply for an EP rather than a LOC. But, this depends on the type of work that you are going to do and your earnings. My sense of the SP and LOC process is that quite a few of the folks that have succeeded intend to freelance on a part time basis, and there are no salary minimums associated with a LOC. Perhaps some of those who have been successful can chime in here.

With the EP you will need to meet minimum salary requirements, and if your business is new, you will need to support your ability to pay that salary with a business plan that projects earnings sufficient to cover your salary and expenses. If you already have clients or contracts in hand, your probability of approval rises substantially.

What goes on inside MOM is essentially opaque but based on the posts here I'm going to guess that MOM has developed some sort of informal policy that basically states that DP's who want to run freelance part time businesses go the SP/LOC route while those seeking to establish a professional full time business are better off with the pte ltd/EP route. But, that's just my guess.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Thu, 22 Oct 2015 8:34 am

Thanks, so it looks like my application won't be approved. It might be easier just to deregister the company straight away, put it down to experience and register as a sole proprietor rather than try and get EP for a one man band outfit.

However, you never know, there is a tiny chance they may approve it as I used this thread for my reasons for not applying for an entre pass, I showed evidence that my Australian business shared the same name (minus the 'private limited') that showed it had been current since 2004 and that my appropriate Diploma was done 16 years ago.

That's all I can hold on to at this stage. I'm going to have a crap few weeks now til I find out.

Thanks for your expert knowledge though

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby Strong Eagle » Fri, 23 Oct 2015 4:18 am

Before totally giving up... what is the nature of your business? What is your expected business revenue? Plenty of people have gone the EP route, and most of the outfits offering company setups go this route.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Fri, 23 Oct 2015 9:53 am

Mobile IT repairs/consultancy. Here in Singapore, no idea of expected revenue to tell the truth. Just hope to bring in a wage.

I received an email this morning that I was unsuccessful:

We have considered your request but it is unsuccessful.

The correct pass for foreigners looking to start new businesses in Singapore should be the Entrepass. Letter of Consent is premised on an employer-employee relationship, it is not meant for setting up of business.


Not happy, complete waste of money setting up a company to do it 'properly'. An entrepass is entirely not appropriate, not to mention its for 12mths and to renew you have to show additional employees earning minimum amounts. If a LOC is not meant for setting up of business, how have dozens of people on this thread got one under sole-proprietorship setups? Surely that's still ' setting up of business' and not 'premised on an employer-employee relationship. How is sole proprietorship any different?

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby smorris291 » Mon, 26 Oct 2015 10:24 am

Singaporeoz-

Sorry for the delay responding, was out of the country last week.

I'm pretty sure I am not qualified to answer the questions about the complexities of the EntrePass vs Sole Proprietorship, though as mentioned above, the requirements are much more onerous for setting up a Pte (capitalization, min salary, etc.). I would think that based on what you want to do, a sole proprietorship is the way to go. I set up an SP (for financial/management consulting) and applied for an LoC using the materials that I was sent by MoM...and was approved within a week (have yet to receive the approval physically but tracked my application and it has been "issued").

Bummer to have spent the $ on the previous application, but to set up the SP it's pretty reasonable ($68.30 for MoM + the cost of a company stamp).

Scott

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby j_burt » Wed, 11 Nov 2015 7:39 pm

Hi bluebubble

Do you know the name of the employment agent that you used to help you apply for the LOC for a dependent pass holder applying for a sole proprietorship?
Thank you for your very helpful message and links.

Regards.

Jon

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Wed, 11 Nov 2015 8:00 pm

Well as we know my company LOC was rejected (ie, it wasn't even accepted as a application), so I set up a sole proprietorship and have done the same, using the knowledge on this forum and what do you know....REJECTED AGAIN! That is via the employment pass check online. Will await formal notification in the post, hopefully with a simple reason that I can fix, and reapply. Disappointed to say the least that someone doing to right thing is denied the opportunity that it seems so many do get.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby sundaymorningstaple » Wed, 11 Nov 2015 11:26 pm

From my reading of this thread, I am not surprised that you were rejected a 2nd time. My gut feeling is that you were rejected because you would be taking business away from locals who are doing this type of business (and there are literally 100's of them) All they need is a Polytechnic Diploma and off they go. I might be wrong, but I'd almost bet a dollar to a donut that might be the reason. Hopefully, it's a simple mistake.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby singaporeoz » Wed, 11 Nov 2015 11:38 pm

I was thinking that, BUT are you saying everyone in this thread that has been approved has started a business that is unique or where there is a shortage of manpower? I very much doubt it to be honest, so to be fair, MOM should be consistent with all applications.

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Re: Open a Sole Proprietorship on a DP and getting the LoC

Postby Strong Eagle » Thu, 12 Nov 2015 12:02 am

singaporeoz wrote:I was thinking that, BUT are you saying everyone in this thread that has been approved has started a business that is unique or where there is a shortage of manpower? I very much doubt it to be honest, so to be fair, MOM should be consistent with all applications.


No, that is not the case. But, there is a sensitivity within MoM about certain fields of work. When the Entrepass was easy to get, there were numerous stated business types for which an Entrepass would not be issued. These included nail and hair salons, hawker stalls, karaoke clubs, and various other activities that could be deemed small business that has a relatively low bar to entrance into the business... capital and knowledge wise.

And while my pipeline into MoM hasn't been working recently, I would not be surprised if your IT mobile repairs hasn't ended up on the same informal list. Go to Sim Lim Square... you'll trip over some kind of IT guy every third step.

I believe you're going to need a differentiator... for example, your ability to sell managed services into SMC's and hire local technicians to handle the managed services.


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