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Starting up business in Singapore

Discuss your views about Singapore business & economy, current policies & issues, starting a business in Singapore.
mukhra1
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Starting up business in Singapore

Postby mukhra1 » Mon, 13 Feb 2012 3:28 pm

Hi:

I'm self employed, basically running an IT business out of the home. I'm in Singapore as my spouse works for the foreign service of a western country.

For tax purposes, I wish to set myself up as a limited company in Singapore. I understand I have to apply with MOM for an ExtrePass and then I can apply with ACRA to register the company. As a foreigner it seems I have to go this way as I cannot setup a sole proprietorship.

Although I am self employed I basically subcontract from one company based in my home country who gets all the work for me. In a decent year I make six figures in Singapore $ but just barely. My clients are generally in Western countries, I do the work online, I invoice the aforementioned company once monthly.

After getting my business approved I want to apply as a Singapore permanent resident, and then when I leave the country setup a virtual office address to keep the business in Singapore and pay taxes in Singapore. I understand I would have to return to the country every (I heard) 5 years to maintain my PR status. When I am living in my home country (which is about 20% of the time I will have to pay taxes there.

My questions:
1. Any flaws in that plan?
2. Anything I should pay attention to that maybe I'm not thinking about? (especially from someone who has done this before)
2. The EntrePass application requires a fair bit of supporting documentation:
http://www.mom.gov.sg/foreign-manpower/ ... uired.aspx

Are MOM sticklers for this stuff? I don't have much--I am just one person doing IT work at home.

Thanks!

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Postby Strong Eagle » Mon, 13 Feb 2012 3:42 pm

The first thing you should do is read the multiple threads in the Careers section regarding setting up a business on a DP. Then come back with questions.

mukhra1
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Postby mukhra1 » Mon, 13 Feb 2012 4:47 pm

Thanks SE, had a look. My understanding from reading the threads and sticky (including your posts from Aug 11) is that a Sole Proprietorship used to be obtainable on a DP (if you went to the now-disappeared "Blue Room" at MOM) but things have tightened up and now they are trying to stream people into getting an EntrePass to form a limited company instead of SP.

Briefly read threads on PR as well.

An Entrepass might be preferable to SoleP anyway...more paperwork I assume but maybe I have a chance to apply for PR? I think you made clear in one post they are separate processes but does starting up a limited company improve your chances? We have at least 2.5 years left in the posting, I have been here for 7 months.

Any threads you can point me to that I might have missed would be appreciated.

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Postby Strong Eagle » Mon, 13 Feb 2012 5:20 pm

Don't confuse a sole proprietorship with an Entprepass.

a) You must have private limited to file for Entrepass, no SP.
b) You don't need to file for an Entrepass for your kind of work, especially since you won't meet the hiring and turnover criteria.
c) You should form a pte ltd and then have it apply for an LOC for you.

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Postby mukhra1 » Mon, 13 Feb 2012 6:14 pm

I wasn't confusing an Entrepass with a sole proprietorship ("an Entrepass might be preferable to a SoleP", "getting an EntrePass to form a limited company instead of SP"), but perhaps I was assuming for a limited company you needed an EntrePass. From your b) and c) responses it sounds like you think I do not. ACRA on the phone today that I do need the EntrePass to form a pte ltd.

Their process:
1) Obtain Entrepass from MOM
2) Obtain SIngPass from CPF.
3) Apply online with Acra to setup the pte ltd.

Not that I believe everything I hear on the phone with these organizations based on the threads I read. However the threads talk mainly about setting up a SP successfully, nothing about setting up a pte ltd without an EntrePass. Is there a case study in a thread of someone who has done this?

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Re: Starting up business in Singapore

Postby beppi » Mon, 13 Feb 2012 9:37 pm

mukhra1 wrote:After getting my business approved I want to apply as a Singapore permanent resident, and then when I leave the country setup a virtual office address to keep the business in Singapore and pay taxes in Singapore. I understand I would have to return to the country every (I heard) 5 years to maintain my PR status. When I am living in my home country (which is about 20% of the time I will have to pay taxes there.

It is doubtful that your PR would get renewed if you were not in fact resident of Singapore in the previous 5 years (just paying tax might not be enough).
In addition, according to information I recently got from a consultant in this field (please check this with ACRA!), "resident" directors and managers must actually reside in Singapore - having a PR and living elsewhere is not enough.

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Postby Strong Eagle » Mon, 13 Feb 2012 10:31 pm

mukhra1 wrote:I wasn't confusing an Entrepass with a sole proprietorship ("an Entrepass might be preferable to a SoleP", "getting an EntrePass to form a limited company instead of SP"), but perhaps I was assuming for a limited company you needed an EntrePass. From your b) and c) responses it sounds like you think I do not. ACRA on the phone today that I do need the EntrePass to form a pte ltd.

Their process:
1) Obtain Entrepass from MOM
2) Obtain SIngPass from CPF.
3) Apply online with Acra to setup the pte ltd.

Not that I believe everything I hear on the phone with these organizations based on the threads I read. However the threads talk mainly about setting up a SP successfully, nothing about setting up a pte ltd without an EntrePass. Is there a case study in a thread of someone who has done this?


Whomever you spoke to on the phone today at ACRA was plain incorrect.

From their website: http://www.acra.gov.sg/Company/Starting ... ompany.htm

The application for all types of business is similar and the *person incorporating the local company may choose one of the following ways:

(*Any person above the age of 18 years old with effect from 1 March 2009 can incorporate a local company)


And that means anyone, Singapore resident or not. So, clearly, you can form a pte ltd in Singapore.

Next, there is the question of directors. Again, from the ACRA webpages:
http://www.acra.gov.sg/Company/Starting ... ditors.htm

[quote]Directors

A company must have at least one director who is an “ordinarily resident”


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