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Sponsored employment pass for foreign employee?

Relocating, travelling or planning to make Singapore home? Discuss the criterias, passes or visa that is required.
harshapd
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Sponsored employment pass for foreign employee?

Postby harshapd » Wed, 27 Mar 2013 8:25 am

Hi,

First, background info, husband works for a US company out of the Middle East, at present. They have asked him to move over to Singapore to handle operations there and this has all happened very quickly ( if we do move, we will have to move over in June). The company has no offices in Singapore, and my husband will be the sole employee in Singapore. Due to company politics and other circumstances related to visas in the ME, we are having to make our own inquiries related to relocating to Singapore.

I've gone through the forum and net, and think that the best possible visa for my husband would be an Employment Pass by a sponsored company in Singapore - on behalf of a foreign company? Am I correct in this? He does not do any work that involves him generating income for the company - his role is mainly advisory and liaison. I gather that EP's are not easy to come by, and so would the sponsoring company be out of pocket for this? What expenses would they have to bear? What would be the tax status for an individual ( non US citizen) on such a visa?

I apologize in advance if this has already been discussed, I could not find anything specific to our situation. Would appreciate help in any way. Should we consult an immigration lawyer? If so, any recommendations for a good person?

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Strong Eagle
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Postby Strong Eagle » Wed, 27 Mar 2013 12:01 pm

You basically have three options available to you.

a) The USA company creates a wholly owned private limited (the USA version of a limited shareholder company). You need an "ordinarily resident" director which can be supplied by quite a few firms, including my own accountant. This company then applies for an employment pass (EP) for your husband.

If the USA company is of any substance.. ie, a multinational, for example, creating the company and getting the EP should be pretty easy. You will need a firm to do this... and immigration attorney is not necessary, a CPA or one of the local firms that advertises this service will do.

Your husband will declare his income in Singapore as he works here, regardless of where it is paid from.

b) The USA company can set up a representative office, and this entity can also apply for an EP. The situation is pretty similar to the private limited, except that the representative company can show no income on its books, and you must be able to demonstrate that your husband is not engaging in activities which are income producing... and this is a wide open topic... if you are advising clients with contracts, you are probably performing an income producing activity... if you are seeking out new business, maybe not.

I can't really see any reason to go with the rep company. The private limited is easy to set up, won't pay any tax if its not earning any money. You can set up a pte ltd for pretty cheap... S$1000 for filing fees and having a CPA get all the stuff put together. I don't know about a rep company... probably a bit more.

c) Your third option is to find a company in Singapore that is willing to hire your husband, then contract him out to your USA company. For example, I could offer to hire your husband at X dollars per month. I would bill him at X plus a decent markup to the USA company for services rendered.

This is going to cost. I am responsible for your husband's EP bond. I have to do the invoicing to the USA company. I have to write the payroll checks to your husband. I have to file his income tax IR8A (Singapore W2). I have to make a profit. I have to pay tax on that profit. I also take the risk of non payment or reneging on a deal after only a short period of time.

Doesn't matter who does the EP... it's really cheap. But best bet is that your husband needs to make at least S$8000 per month... anything less and you may run afoul of the anti foreigner crackdown.

Best bet: Have the USA company set up the wholly owned private limited. Your husband handles all the paperwork for payment of payroll, expenses, etc, or you hire an accountant to do the same.

Or... if politics are in the way, engage a local firm to act as contracting agent to hire your husband, apply for an EP, and contract him out.

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Postby harshapd » Wed, 27 Mar 2013 6:32 pm

Thank you for the reply.

So the whole sponsored visa thing is not as easy as it sounds. There are companies who are willing to do this? I'm getting the feeling that it might not be legal. Plus potential for a huge mess. His local franchisee has offered to sponsor him, however it was offered with reluctance - something about quotas? 1 foreign worker for every 4 Singaporean nationals? Also, it would affect my husband's working relationship with them , so he is not keen on the idea.

The company has a registered subsidiary in Hong Kong, with no employees living there. So they are reluctant in registering an office for no added benefit.

The rep company sounds appealing, husband does nothing but advise on operations of franchisees ( not getting them, just helping them set up and monitoring afterwards). So perfect for him. However the 3 year time limit is restrictive. I read in another thread, that they are quite lax about this and companies have been registered for more than 3 years?

The problem in this is that it was our suggestion to the company to move to Singapore, because we didn't like the choices the company offered. So expediting this is primarily our responsibility!

I would be grateful for any info on good CPA's or companies that are willing to sponsor. Any links or just pointers on how to search for them.

Thanks again.

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Postby taxico » Wed, 27 Mar 2013 7:41 pm

not to be a dick, but shouldn't these things be handled by your husband/his company?

are you being paid? i hope you are.

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Postby harshapd » Wed, 27 Mar 2013 8:44 pm

taxico wrote:not to be a dick, but shouldn't these things be handled by your husband/his company?

are you being paid? i hope you are.


LOL..I don't think you're being one at all!

It should be but that's what I meant by company politics. They have about 3000 employees but only about 20 people international. Each operates pretty much on their own - they are hired for their ability to produce results without supervision and believe me when I say it's less hassle to do things by ourselves. They pay very well for the job.

As for my pay, my husband knows what I charge! :D

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Postby taxico » Wed, 27 Mar 2013 10:00 pm

harshapd wrote:...The company has a registered subsidiary in Hong Kong, with no employees living there. So they are reluctant in registering an office for no added benefit...


i'd go with eagle's suggestion of starting a singapore PLC. it is not difficult nor expensive to start and wind-down a singapore company (everything can be done online even).

for more details try www.business.gov.sg or enterpriseone.gov.sg

eagle has an accountant he can recommend you.

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Postby harshapd » Wed, 27 Mar 2013 10:28 pm

Thanks Taxico, much appreciated.


Strong Eagle, may I have contact details of your accountant?

Thanks

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Postby Strong Eagle » Thu, 28 Mar 2013 1:16 am

harshapd wrote:Thanks Taxico, much appreciated.


Strong Eagle, may I have contact details of your accountant?

Thanks


I will send my accountant details in a PM. There is a fourth option open to you. Instead of your USA company creating a wholly owned subsidiary and then employing you, you could form your own private limited with, say, you and husband as shareholders and directors (as before, you would still need to employee a nominee director until such time as you were "ordinarily resident" in Singapore, ie, you have your EP and DP).

You should read through the threads about the Entrepass in the Business forum. Quite a few people have formed their own pte ltd and applied for and obtained their EP. A MOM official has emailed me that such requests are evaluated on each separate basis.

If you were to go this route, you'd want to be able to provide evidence of a contract, with payment amounts. This would demonstrate that you have a going concern with a contract in hand.

Of course, this would also mean that under your Singapore arrangement, you would be a contractor to your company and not an employee.

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Postby Pinkygal » Fri, 29 Mar 2013 7:37 am

Hi Strong Eagle,

I just read your post with interest.

My situation is like this. My husband is a Singapore citizen and has just retired ( he was working in UK for past 10 years so have not been contributing to CPF or taxes in Singapore. ) I'm a British citizen and we have been married for 6 years.

We are planning to move back to Singapore this August and I would like to continue doing freelance work as a consultant working for my clients in UK.

Can my husband ( as SC ) set up a Sole Proprietorship or a Pte Ltd Co and apply for a Employment Pass for me ? What are the best steps to take in order for us to move back and for me to continue to work as a freelancer.
My salary is about S$10,000 per month and I have a degree in Business from University of London.

Appreciate any input
Thanks

Strong Eagle wrote:
harshapd wrote:Thanks Taxico, much appreciated.


Strong Eagle, may I have contact details of your accountant?

Thanks


I will send my accountant details in a PM. There is a fourth option open to you. Instead of your USA company creating a wholly owned subsidiary and then employing you, you could form your own private limited with, say, you and husband as shareholders and directors (as before, you would still need to employee a nominee director until such time as you were "ordinarily resident" in Singapore, ie, you have your EP and DP).

You should read through the threads about the Entrepass in the Business forum. Quite a few people have formed their own pte ltd and applied for and obtained their EP. A MOM official has emailed me that such requests are evaluated on each separate basis.

If you were to go this route, you'd want to be able to provide evidence of a contract, with payment amounts. This would demonstrate that you have a going concern with a contract in hand.

Of course, this would also mean that under your Singapore arrangement, you would be a contractor to your company and not an employee.


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