Tips for doing business in Singapore. Attractive tax regime in Singapore

We've been getting a lot of inquiries lately from clients looking to relocate to Singapore, and many of them are asking for advice on the type of work they could do in Singapore. In our opinion, such a question is a sign that the client is not yet ready for business immigration. In this article, we will try to substantiate our opinion.

Let's turn to the most popular scheme for business immigration to Singapore - through the Employment Pass (work visa). In one of our previous articles, we described in detail the process of obtaining it, but now we will briefly remind readers that in this case, as a rule, a Singaporean company is created by an entrepreneur, on whose behalf an invitation to work is then issued for him. In fact, this project is a “one-actor theater”, and it depends only on the entrepreneur himself, his business qualities, whether this project will be successful.

Essentially, success has three unchanging ingredients:

• You need to know what to do in Singapore (that is, decide what area you are going to work in: whether it will be consulting, sales or something else);
• You must know how to do this (clearly imagine the model for bringing your business idea to life: for example, have at least a small, but already established client base);
• You must be able to work on the implementation of your ideas, sticking to the plan and using your skills.

A successful project is not possible without any of the three components. To work in any area, you must have a good understanding of it (know the market, business processes, the mechanism for attracting customers). If you rush into the pool with your head (i.e. into new sphere without any knowledge), there is a great risk of not swimming out.

In order to successfully implement a business idea, for example, to sell your services / products, you need to clearly understand the action plan (in our example, to know the target audience and develop methods to attract it). If you do not pay due attention to this, the possibility of failure increases many times over.

Let's assume that the first two components are present: you have experience in the area in which you intend to open a business, you have a client base and a clear understanding of how your business should work. But if, with all this, you cannot, for example, establish business processes, and the quality of your services suffers from this (the simplest example is interruptions in the supply of goods), customers will leave, and gradually everything that was created with difficulty will crumble like a house of cards.

Of course, with experience, the horizons of each entrepreneur expands: new, more ambitious ideas come, and failures force you to reconsider tactics and apply new methods, but in any case, every successful project has all three designated features: a clear understanding of what exactly to do and how, and practical skills to implement their ideas.

Therefore, when our potential clients ask the question in the title of the article, we believe that their endeavor is likely to fail, as a key component of success is missing.

However, for those who have not yet decided on their own business projects, we can also offer a solution. They will be buying ready business. A business is being sold for many reasons: lack of investment, a desire to retire, a change in life priorities - the list is endless.

But the fact remains that at every moment in any country with a market economy there are those who want to sell their business. It can be either a successful company or enterprise that has been operating for many years and bringing a stable income, or just an idea that has yet to be developed.

The purchase of a ready-made Singaporean business can be used for immigration and obtaining an Employment Pass in Singapore. Of course, this method may require large financial investments compared to the situation when our potential client knows exactly what he wants to do: sometimes the price of buying a successful business is many times higher than the initial investment in developing your business from scratch. However, this can be a solution for those who have not yet decided and are ready to risk some amount of money (it is worth remembering that the acquired business will have to be managed or competently selected people who are ready to take on this function).

For immigration purposes, it does not matter at all what kind of business you are acquiring - trading company or a travel agency, a restaurant or a banal dry cleaner (yes, dry cleaners are also for sale from time to time). This decision provides an answer to the question “what to do” and the possibility of business immigration to Singapore and is, in fact, the beginning of an exciting journey.

If you are eager to immigrate to Singapore, but you do not yet have all three components of a successful business, please contact our specialists to find out which ready-made business is currently offered for sale, as well as prices and conditions for the purchase.

IN last years Singapore is one of the main points in the region when choosing a location for opening headquarters in the big business segment. This choice is not made lightly. The Singapore government is on a steady course to attract investment from transnational organizations around the world. The proceeds are invested in the economy of this unique jurisdiction.

The vast majority of companies use Singapore as a point for assigning value added products. Namely, if a product is produced in country A at a low cost and sold in country B at a higher price, the difference in cost is attributed to the Singapore link. Most corporations that sell precious metals, raw materials and goods in other countries operate on this principle.

Not less popular Singapore as a marketing and service hub. In this case, all revenues and surplus value of products are also transferred to Singapore.

At the same time, Singapore is used for the production of goods. In most cases, these are high-tech products with above-average markup costs per unit of labor. This is because Singapore is very high level life with an average income in the region of 4-6 thousand USD.

This general trend of large corporations did not just happen. The state has a very loyal policy regarding the tax regime, ease of doing business, foreign trade and general administrative burden.

The most important thing is that all these positive aspects The Singapore system is available not only to large international companies, but also to small and medium business.

Today, Singapore is a very rapidly developing high-tech market. In this market, there are many benefits and indulgences for new companies in small and medium business segments. Mainly tax incentives And simplifying the registration and administration process. Singapore is an ideal place for company development in service or marketing. Also used here in great demand firms working in the field of tourism and information technology. But here it must be borne in mind that when opening a company to work with information technology or tourism, Singapore has its own dedicated regulatory bodies. So it is possible to maintain quality and control over certain industries.

Attractive features of Singapore

The first feature is undoubtedly Singapore has many tax concessions for both small and large businesses. In addition to the enticing 17% tax rate, full and partial tax exemption for new businesses, there are also partial annual tax refund schemes and tax credits that eliminate the need for the possible re-payment of tax in another country for the same product. or a service.

The state conducts a strict suppression of crime and illegal practices in all areas, including financial ones. Thanks to this, in Singapore it is possible to conduct commercial activities in a state of peace and full security. Which in itself plays a big role in reducing the potential risk for the development of the enterprise.

Singapore for small businesses

The most popular type of company formation in Singapore is a company with limited liability. It provides an opportunity for a complete division of responsibility between the owner and the commercial structure. Even under conditions of foreign ownership of shares, the company will still be entitled to take advantage of all existing benefits and be regarded as local. In addition, liability for losses and damages incurred is not shifted to the personal assets and property of shareholders, but is fully borne by the company itself.

An additional positive factor for starting a small business will always be the possibility for the director to obtain a work visa to Singapore. There are a number of specific conditions for doing this, but upon receipt of it, you can personally stand at the head of your company without nominal directors with local citizenship.

Simplicity of the process of opening a company in Singapore

The process of registering a company in Singapore takes one to two business days. It is extremely simple and devoid of excessive bureaucracy. At the same time, personal presence in Singapore for the registration of a company is completely optional. Everything can be done easily and simply remotely.

It will take up to four weeks to open a corporate bank account, which means that almost any business and commercial activity can be launched within a month. Singapore is part of the global commonwealth against corruption and money laundering, which exposes it to a general trend towards tightening financial regulations. At the same time, in this state, financial regulations are a little softer and, as a rule, international transactions are carried out with greater simplicity compared to other financial centers of the world.

Stability of the Singapore market

Singapore is Asia's largest port and has a unique economy balancing between Asian and Western markets and currencies. This gives it a greater degree of protection from external economic shocks.

Below is a chart of the Singapore Property Price Index showing the elasticity of prices and trends as global markets suffered huge declines.

The Singapore dollar has shown a steady growth in price against the US dollar over the past half decade and is a reliable currency to trade commercial activities and storage of reserves.

The Political Climate of Singapore

The political and economic situation in Singapore is quite calm. The state constantly introduces new concessions for business, increases investments both in construction and in the total landscaping of the island. Singapore is ranked globally as: the third largest currency exchange market, financial center, and oil refining center; the second busiest container port; the second most competitive state; " best city for international meetings” (UIA); city ​​with the best investment potential (BERI); "Most Technologically Ready City" (WEF).

What is required to open a business in Singapore?

To get started, you need to register. To do this, you will need to choose a name for your organization that is not used by others and is legal for use in Singapore. It should be borne in mind that not only certain types of activities are regulated by the Singapore government, but even the choice of certain names requires registration. This is, for example, if the title contains keywords related to medicine, education, legal services, religion and the like.

Next, you will need to indicate the type of activity of the opened enterprise. Here, too, there are regulated industries that may require the approval of the authorities, but usually they are not included in popular activities.

The next step will require a contribution of the company's authorized capital, but Singapore has a minimum requirement for its size, which must be equal to at least one Singapore dollar.

Next comes the remote signature and the formation of the company structure. It should be borne in mind that in Singapore legislation there are a certain number of nuances and requirements when forming a company.

What business will be most interested in the jurisdiction of Singapore?

Singapore will be, first of all, of interest to those who strive to get the maximum benefit from a loyal taxation system and foreign trade in services and goods.

The most popular business areas in Singapore are:

• Service
• Information Technology
• Tourism

Interested in Singapore? You have come to the address. We register companies in Singapore, open a bank account.

Singapore is not Big city- a state on the Asian continent, distinguished by the highest standard of living and a favorable business climate for investment. The country attracts highly skilled migrants from all over the world, being one of the leaders in the technological field.

The state supports both the relocation of specialists to the country and the rapid opening of a company. In Singapore, a migrant does not have to file a case for a local resident or create fictitious companies - registering a small business with a visa and ready documents takes about a day.

What is business immigration

Immigrants to Singapore most often go to the country at the invitation of local corporations. For low-skilled labor from the CIS countries, they rarely go - the niche is almost completely occupied by Asians from neighboring countries. People often move from stable income or remote work because of the standard of living and the great climate.

Migration legislation actually prohibits moving to the country for long term without a specific goal - the migrant must get a job, open a business or invest in the country's economy. That is why the percentage of educated emigrants in the Russian diaspora in Singapore is very high.

What is a business visa and what type of it can be obtained in Singapore

A business visa is an entry permit for entrepreneurs and employees who are going to live and work in the country.

It is divided into two types:

1. EntrePass (for businessmen);
2. Employment Pass (employees by invitation).

It is issued for a period of one to two years with the possibility of extension, in the second case, when changing the employer, the visa will have to be reissued.

A business visa is issued for more than six months, after receiving it, a migrant is practically equal to local residents when creating a company.

For getting Entry Pass in addition to the standard package of documents, you will need:

• Detailed business plan;
• Letters of recommendation from major partners;
• Company registration documents.

Family members of a migrant who has issued a business visa can receive a Dependant Pass or "dependant visa". The document has practically no restrictions, but in case of loss of the right to stay in the country with the head of the family, the rest lose their dependent visas automatically.

What type of business is more profitable to open in Singapore

There are three distinct areas of development in the country:

• Information Technology;
• Tourism;
• Services sector.

Representatives of small businesses often become small IT companies consisting of several specialists: telework allows you to earn without being tied to the labor market of the country. Medium business mostly moves entirely from other countries - legislation

Singapore allows you not to pay taxes on funds received outside the territory of the state, which makes a registered company a direct analogue of an offshore company.

FROM big business everything is somewhat more complicated - the more innovative and large-scale the case, the longer the officials will consider the issue. Registration may require state participation: this will not only allow Singapore to receive income if the project is successful, but also create an airbag for participants in case of failure.

According to compatriots who moved, the two main reasons for migration were security and ease of doing business. Bureaucratic processes are streamlined as much as possible, there are practically no delays in paperwork. Personal relationships and connections are very important: Asian culture leaves its mark.

Conditions for immigration to Singapore for entrepreneurs

The visa is selected depending on the direction of activity. So, a high-class programmer can enter the country as an entrepreneur or innovator.

It is worth remembering that the Singapore Ministry of Labor will check the migrant firm for compliance with the requirements in a year, and in case of failure, the visa will be revoked.

Starting in 2017, the lower limit for funding startups was eliminated. Requirement for start-up capital 36 thousand dollars was excluded, and the assessment of the prospects of the project is carried out in an expanded manner. According to the government, this was done to expand support for small businesses and increase the number of projects that do not require significant investments at the start.

Choosing the right visa, conditions for obtaining it

EntrePass can be obtained in three ways:

1. Entrepreneur;
2. Innovator;
3. Investor.

Each type of visa has its own requirements.

Entrepreneur:

• Has received at least $100,000 in investments from the state or a venture company;
• Has notable experience in organizing start-ups or an existing successful business in other countries;
• Participates in one of the state programs to support business in Singapore.

Innovator:

• Possesses intellectual property(for example, a patent or software);
• The company cooperates with research institutes Singapore;
• Has outstanding competence in areas related to the declared business.

Investor can provide a history of successful startup investments.

EntrePass not available in the following areas:

• Bars, coffee shops, outdoor cafes;
• Night clubs and karaoke;
• Massage, acupuncture, traditional medicine;
• employment agencies.

Conditions for obtaining a residence permit, permanent residence, citizenship

Citizenship of Singapore is considered one of the most convenient for visa-free travel - 159 countries are available to the holder. In addition, a Singaporean passport removes the last questions about living in the country and protects against a sudden cancellation of a visa due to non-compliance with any formal requirements.

Obtaining citizenship for business visa holders is simplified and will take about five years. The first step will be obtaining a residence permit / permanent residence after one or two visa extensions. Then, after two years of residence in the country, an application for citizenship is allowed.

Large investors can get permanent residence immediately after the investment of ~ 1,800,000 US dollars. In this case, the registration of citizenship will take only a couple of years.

Conditions for obtaining citizenship are not much different from most Asian countries:

• Stable income;
• Absence of socially dangerous diseases and convictions;
• Business legitimacy.

Buying a ready-made business and starting from scratch

To buy a business in Singapore, in most cases you will have to register new company with limited liability. This will not only protect against possible problems with creditors and the "legacy" of the old business, but will also significantly simplify the transfer of assets.

The purchase is carried out in five steps:

1. Verbal agreement with the owner to purchase the business;
2. Formation of an LLC (in terms of Singaporean law - Pte Ltd);
3. Drawing up a list of property passing to the new owner in order to avoid disagreements. Agreement on the transfer of customer and supplier contact databases;
4. Drawing up a contract of sale. It is better to contact lawyers - the service will cost about a thousand US dollars or more, depending on the size of the transaction;
5. Renegotiation of all key lease agreements, personnel change (if necessary).

Due to the fact that the vast majority of small and medium-sized businesses are registered as individual entrepreneurs, as well as due to the need to create their own company upon purchase, for a business visa holder, acquiring a business and running it from scratch is practically no different. You should be careful when buying a startup - successful new ideas are rarely sold.

Common business options for Russian emigrants

The first massive wave of business emigration to Singapore from Russia started at the beginning of the 2000s, with the advent of the EntrePass program. During this period, there were practically no restrictions on the direction of business, so the vast majority of migrants began to open cafes or massage parlor. In a city that is almost entirely a tourist center, such establishments were inexpensive and quickly paid off.

In the early 2010s, the city was covered by the second wave of migration - IT specialists. Ease of taxation and a high standard of living has made the city a haven for many individual entrepreneurs at remote work. The Singapore government directly encourages such private traders, creating a promising labor base for its corporations.

A significant part of Russians work in the service sector, selling their skills under the guise of a company or individual entrepreneur. Hairdressers and stylists, interior designers, private car repair shops - behind half of Russian companies there is a specific person with decades of work and unique experience.

Business ideas with minimal investment

Singapore's current trend is shifting to online services and delivery where previously it would have been considered insane. Numerous online stores, carsharing services, ordering groceries and essentials are still not completely occupied by a niche, so newcomers will have something to hook on to.

A themed shop or cafe with a national flavor can be popular. But it will be difficult to get a visa with such an offer - you will have to convince officials that the business is really unique, and will not become another eatery out of thousands of similar ones.

A high-quality service, such as a car repair shop with car tuning or an atelier that sews unique dresses, will also allow you to easily get a visa and income in the city itself.

Unless you have to provide a portfolio and prove to the migration service that the services are of really high quality.

Examples of successful business

Youth clothing and accessories store Dottinghill offers its customers temporary tattoos designed by independent artists. The site itself is an intermediary where artists post their work. With a sufficient number of applications, the tattoo is put into production, and the artist is paid a percentage of sales.

Increasingly, the strangest tasks are being outsourced. For example, Synnovate Solutions offers catering establishments to outsource dishwashing to their specialists. Everyone wins - the owner of the restaurant gets rid of the problems with hiring dishwashers for a little more money, and the outsourcing company receives its money from the difference in salaries.

Legal nuances

The country has more than a hundred public and private programs that provide assistance in running and supporting business, and tax legislation is one of the most flexible in the world. Before registering a company, you should consult with a professional lawyer on the best conditions.

Business registration

To register a company in the country, you will have to go through four stages:

1. Obtaining official permission for the name. It must be unique, and a number of additional words, such as "travel agency", "institute", "bank" are confirmed by additional licenses;

2. Collecting a package of documents. Standard set includes:

• Memorandum of association;
• Charter approved at the general meeting;
• Confirmation of the company's compliance with the law;
• Information about the founders, copies of their passports.

3. Signature of documents. Carrying out the procedure in Singapore will significantly reduce the processing time;

4. Document submission to the official register along with the payment of a state fee of 330 local dollars.

Taxation

For 2019, the country has two taxes:

1. Income with a progressive rate;

The value added tax was introduced a few years ago and is only 3%, the income tax rate is 17% since 2010.

There are many programs and tax incentives- so, with the total income of the company up to $ 300,000, the tax will be halved. Innovative companies can get the status of "pioneer", completely exempt from taxes for several years.

You will have to pay extra for:

• Use of cars (transport fee);
• Provision of services (service fee);
• Hiring foreign employees.

Other nuances

The country's business language is English, although in private life many use Chinese or Malaysian. For everyday communication and work in English quite enough.

The choice of name can create the greatest problems during registration. A company name that is not unique or simply similar to a global/local brand will cause a lot of problems and delays in registration.

You can manage your business by tourist visa. In this case, the company will need to hire a local managing director and secretary.

When organizing a business in Singapore, there is no need to try to cut corners or simplify the procedure. Penalties for breaking the law in the country are very harsh - even small fines for trash thrown on the ground start at 500 Singapore dollars. In the case of more serious offenses, the migration service will not hesitate to revoke the violator's visa.

You should not save on the facade and small services: 75% of the country's population are ethnic Chinese and Malaysians, personal contacts and a respectable face are very important in their culture. As an example: local businessmen wear business suits even in 40-degree heat, and even the most profitable business can fail without a personal meeting.

An Asian benchmark with hard-working people and the rule of law, Singapore is a great place to live and start a business. The magnificent location, tropical climate and proximity to the ocean have made this state not only one of the best resorts in the world, but also a great place to work and live.

Singapore is often referred to as the economic miracle of the Southeast, and in many ways it is. In the shortest possible time, this country was able to turn into an economic giant, having managed to attract many transcontinental corporations. Many consider this small state an ideal place to start their own business.. Today we will analyze in detail how to open a business in Singapore for Russians, what needs to be done for this and what documents to issue.

We have prepared an informative article for you. But before you start reading it, we recommend watching a video - about the most interesting facts about this amazing country from an ordinary resident.

Features of business in Singapore - what you should prepare for

Singapore is in many ways a very unusual country, in fact it is not a state in our usual view - it is one big city. From an economic point of view, everything is also very difficult here, let's look at all this in detail:

• The business is very structured. This is expressed in literally everything. Each profession here has its own specification and structured. Here Literally everything is laid out on the shelves And you will face this as soon as you try to open your business in Singapore. For foreigners, this may seem very strange, but in order to open your own company, you need to hire a secretary, while he must be a resident and must be accredited.
• Asian mentality. To the uninitiated, this may seem strange, but for many Singaporeans, the main career goal is not enrichment, but promotion, preferably the state. So if you can't offer a good career ladder, then find worthy workers among local population you can hardly, but it compensates big amount labor migrants.
• Work migration. And even labor migration looks special here, it is simply impossible to come here and try your luck. You need education, it does not matter higher or secondary special. In addition, you must have work experience, otherwise you simply won’t get a work visa.
• Corruption. If you decide to open the world ranking of countries for corruption before coming to Singapore, you will see this country in sixth place. But do not deceive yourself, business in Singapore for Russians will not be built in the same way as in their homeland. If you look at the ranking of the cleanliness of bureaucratic hands, then this country is one of the three world leaders. This difference is due to the fact that the inflow of money from outside was not strongly controlled. Local exchanges were the center of money laundering throughout the Asian market.

In general, it is very difficult to find differences from other Asian countries here, the only thing is officials take bribes much less. Business in Singapore for Russians can be called one of the best in the world.

Key questions before starting a business

Business in Singapore for foreigners - how to open?

This island state is an economic Mecca in Asia, it is quite easy to open your own business here, the state tries to minimize its influence in the business sphere, which has a very favorable effect on business in Singapore. For Russian people, some requirements may seem strange, let's analyze them in as much detail as possible:

• When opening a company, one of the founders must be either a citizen of Singapore, or have a residence permit or a work visa. This is done for the participation of Singapore as such in all economic activities.
• Authorized capital. For some, this will seem ridiculous, but minimal authorized capital company is equal to one dollar. According to experts, this was done in order to maximize the inflow of foreign finance into the local economy.
• Singapore is actively fighting corruption and this is manifested in everything. The position of director cannot be held by a person who has a criminal record for corruption.
• The company cannot consist of only local or only foreign assets. A symbiosis of local economic power and foreign injections is necessarily provided. However, the shares are not specified in any way.
• The company must have its own address in Singapore.
• As mentioned above, it is mandatory to hire an accredited secretary.

Business in Singapore for Russians - what to do?

Another important question is what to do, which is relevant as a business in Singapore. Ideas can be found different, but everything lies on the surface - more than 80% of the population is employed in the service sector. On the this moment this is the most sought after area. Tourism, restaurant business, music schools - all this will bring you money, but do not forget that this will also require you big investments, from 100 000 dollars.

On the special place everything is worth transport companies . The thing is that a private car in Singapore is not a means of transportation, but a luxury. Coating transport services can bring big profits.

But here than exactly it’s not worth doing - it’s serving diasporas. Many immigrants come to foreign countries and work with interesting target audience- their countrymen. They build shops with "native" products, open private schools and kindergartens focused on them. But this is doomed to failure. In Singapore, there is no such thing as a diaspora, and this is enshrined at the legislative level. This was done so that relatives would stand and traditions would not interfere with the development of society and the country's economy.

But the ease of starting a business makes up for it. If you have business acumen and really want to make money, then this country will be perfect for you. Here there are a huge number of programs to support small and medium-sized businesses. And foreign companies can take exactly the same part in them as the locals.

Business in Singapore for Russians - step by step registration

Despite the fact that the bureaucracy is kept to a minimum in Singapore, but let's take it step by step, What you need to do to register your company:

1. First of all, you need to decide what you want to do. The fact is that in Singapore, some industries require additional licenses and permits. In addition, they have a fixed amount of authorized capital. For example, to open a travel company, the authorized capital of your company must be at least $100,000.
2. After that, you need to choose a name for your future company. Legislation simply does not allow the existence of firms with two identical names. You may have to spend several hours at the computer, choosing a good name for your business.
3. Calculate the required investment. Despite the fact that the minimum authorized capital is equal to one dollar, this amount will obviously not be enough. As mentioned above, this is done in order not to scare off potential investors.
4. So if you have citizenship, a residence permit or a worker, or a person who has one of these documents, then you can skip this paragraph. If none of the above, then you need to find a firm that will help you in registering your Business in Singapore. For Russians, this may be especially true, since they usually do not have such connections.
5. If you have used the services of a local company registration company, then as a rule they completely take over this item. You need to approve the entire management and management team: directors and shareholders. Remember that there should not be more than 50 of the latter. And be sure not to forget the secretary.
6. Prepare documents: current account, letter from the bank, charter of the organization.

Myself the process of registering a company takes exactly one day All procedures are done online. If you have used the services local organizations, then your participation will not be required at all, with very rare exceptions.

These exceptions apply to those very industries with the necessary licensing. At a minimum, the bank will require you to be present in person when opening an account.

A few words about taxes

The taxation system in this state is quite interesting, but at the same time very soft. The government makes no distinction between residents and non-residents and the tax rate is 17% on income. But it does work a large number of benefits. The most important of them is new organization exempt from tax on the first $100,000 for the first three years. It looks like this:

• When you reach a profit of $100,000, you pay nothing.
• Upon reaching a profit of $ 200,000, you need to pay 8.5% tax.
• Upon reaching a profit of $ 300,000, the tax rate is 5.7%.
• If the profit exceeds 300,000, then the full rate of 17% is paid.

This is done in order to allow start-up companies to develop and not burden them with excessive deductions.

However, as a consequence, if your organization does not reach a large profit, gentle tax rates of up to 4.3% can also be applied to you.

Singapore - business visa

The last issue that remains to be considered is obtaining a visa. If we talk about business immigration, then there are two options:

• Invest $50,000 in the company at once.
• After opening a company, your local partners will issue you a business visa.

Even here there are no problems. Singapore business visa is issued at the Asian Visa Application Centre.

Conclusion

Today we looked at what a business in Singapore is for Russians. Many consider this place an economic paradise, in many respects this is true. But if you are not ready for fair competition, then this country will not the best place to start your own business.