Convert EP to PEP, then set up and run a business?

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Broadleaf
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Convert EP to PEP, then set up and run a business?

Post by Broadleaf » Mon, 07 Feb 2011 3:58 pm

Further to recent posts about my desire to set up and run a Pte Ltd in Singapore, I have received some professional advice that suggested an easier option to setting up a company and applying for an EP through that company would be for me to convert from my P1 EP to a PEP and then set up a company.

The advantages would be as follows:

No large paid-up capital required. Company could be set up with $1k or so
No local Director required - I would be the local Director.

However, the MOM website says the following:

* The following groups of foreigners are not eligible for the PEP:

(i) foreigners who are issued with an Employment Pass under the Sponsorship scheme. Under this scheme, their direct employers are overseas companies which do not have a Singapore-registered office/business entity;

(ii) foreigners who are working or intending to work on a free-lance basis without any direct employers in Singapore;

(iii) foreigners who are listed as Sole Proprietors, Partners or Directors in a business/company registered with ACRA and are shareholders of that business/company.

(iv) foreigners working as journalists, editors, sub-editors and producers.


The same website also says: Note: The PEP holder is not allowed to start his/her own business or engage in any entrepreneurial activities. The holder must apply for an EntrePass if he/she intends to do so.

However, the advice I have received states that, provided I do not have a 100% shareholding in the company I set up, then I will not be classed as engaging in entrepreneurial activities.

Can anyone comment please? Thanks

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carteki
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Post by carteki » Mon, 07 Feb 2011 7:58 pm

I'm not sure who is giving you the information where "no local director is required" - you don't have PR nor are you a citizen - not sure you qualify as a "local director". Otherwise basically what you have there is true - the company is 'engaging' in entrepreneural activities. You are merely an employee.

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sundaymorningstaple
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Re: Convert EP to PEP, then set up and run a business?

Post by sundaymorningstaple » Mon, 07 Feb 2011 8:20 pm

Broadleaf wrote: The same website also says: Note: The PEP holder is not allowed to start his/her own business or engage in any entrepreneurial activities. The holder must apply for an EntrePass if he/she intends to do so.

However, the advice I have received states that, provided I do not have a 100% shareholding in the company I set up, then I will not be classed as engaging in entrepreneurial activities.

Can anyone comment please? Thanks
You will not that the operative word here is OR!

The PEP holder is not allowed to start his/her own business.

The PEP holder is not allowed to engage in any entrepreneurial activities.

The PEP holder MUST APPLY FOR AN EnrePass if he/she intends to do so.

Which of those three statements are you having a problem with?

Are you going to believe a company whose sole purpose is to bilk unsuspecting rubes out of their money. Which, by the way, if unsuccessful, you will not get their fee back. OR would you be more inclined to believe a government website? Your call. They might know something we don't. Or, they might have had ONE case where the business was considered a "critical" need here so the allowed it to happen. If you feel you have that special niche that the government just doesn't have the expertise locally, then go for it. In the words of Dirty Harry, Do you feel lucky? You are only out, what? Around $2.5~3/K in fees to the consultants if you fail?

sms
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

Broadleaf
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Post by Broadleaf » Mon, 07 Feb 2011 8:38 pm

OK - thanks for the feedback.

I am now told that this will be a very easy thing to do (by a number of people) and that the way to get around that wording is to make sure that I do not have a majority shareholding in the new company. Apparently, this is done all the time....

I cannot apply for EntrePass, as I will not be employing Singaporeans.

I see no other options left open to me but to try this route....

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Post by Sawarto » Tue, 08 Feb 2011 9:24 am

would you be considering to be the only person in your company? Or your are intending to hire foreigners?

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Post by Broadleaf » Tue, 08 Feb 2011 10:06 am

The company will probably consist of myself and my wife and we would not be looking to hire anyone else.

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Strong Eagle
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Post by Strong Eagle » Tue, 08 Feb 2011 2:49 pm

The new regulations have made it very difficult for self employed professionals such as forex traders and/or project managers and other skilled professionals to start their own businesses, employing just themselves.

OTOH, when I enquired to MOM a year or so back about this issue, they told me that every case is reviewed on its own merits. To me, this statement translates as follows:

If you already have a successful business and a solid track record in your profession, and you have made good income from it (like at least a P1 salary), and your desire is to move to Singapore and continue in that business, I think you will be allowed to form a private limited, then apply for an EP for yourself, thereby eliminating the need for an Entrepass.

If, however, you are starting a new business, have no track record, or are not starting a 'professional' business like a consultancy, then you will not be able to form a pte ltd and get an EP... they will force you to meet the requirements for an Entrepass.

Otherwise, this country would be swamped with would be aspiring entrepreneurs coming in with no money, and setting up business that could be set up by locals.

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Post by Sawarto » Tue, 08 Feb 2011 6:01 pm

would like to discuss further with you. Will there be an email we can touch base ?

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sundaymorningstaple
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Post by sundaymorningstaple » Tue, 08 Feb 2011 6:10 pm

Apparently you don't read too well do you. :roll:
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

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Post by Strong Eagle » Tue, 08 Feb 2011 6:36 pm

Sawarto wrote:would like to discuss further with you. Will there be an email we can touch base ?
Post your questions in the forum. I do not respond to private enquiries.

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