Starting on a business venture in Singapore offers immense opportunities for both locals and foreigners alike. With its favorable business environment, robust infrastructure, and strategic location, Singapore has emerged as a prime destination for entrepreneurs. This guide aims to provide a step-by-step overview of starting a business in Singapore, including considerations for foreigners, the best business options, the cost of setting up a company, and the necessary steps for successful establishment.
A comprehensive guide to start a business in Singapore
Before starting on your business journey in Singapore, it is important to consider several key factors. This guide provides valuable insights and steps to help you navigate the process effectively.
1. Choosing the Right Business Structure and Registration Process
Determining the appropriate business structure is crucial. While sole proprietorship may seem appealing, it carries risks and personal liabilities. Registering your business as a private limited company is a safer option. The registration process is relatively simple and cost-effective. Explore our Industry Guide for more information on choosing the right business type and operating a Singapore company.
2. Securing Funding for Your Business
Consider various funding sources beyond personal savings and loans from acquaintances. Singapore offers attractive schemes to support small businesses. Organizations like SPRING Singapore provide funding and support for innovative business ideas. Familiarize yourself with schemes such as the Business Angel Scheme, SPRING Start-up Enterprise Development Scheme, Technology Enterprise Commercialization Scheme, and Sector-Specific Accelerator Programme. Contact SPRING or explore other avenues like ACE Singapore, BANSEA, and Investment Network Singapore for guidance and funding opportunities.
3. Networking and Building Connections
Networking is vital for the success of your business. Engage in professional networking and join trade and industry associations relevant to your domain. Participate in start-up meets, trade shows, exhibitions, and seminars. Actively engage on social media platforms. Building a strong network will help you gain valuable insights, establish partnerships, and access potential customers.
4. Establishing Your Office Space
While starting from home is a cost-saving option, consider moving to a separate office space as your business grows. Keep in mind that commercial rents in Singapore can be high. Plan for staffing challenges and determine the number of employees needed in your first year. Solid financial estimates will help you manage expenses effectively.
Singapore’s business-friendly environment, extensive network of Double Taxation Agreements, and government support make it an attractive destination for entrepreneurs. By following these steps, you can set up your business in Singapore with confidence and take advantage of the opportunities available.
Starting a small business in Singapore has never been easier. Take advantage of the supportive ecosystem created by the Singaporean government and begin your entrepreneurial journey today.
Starting a business in Singapore for foreigners: Some constructive tips
Singapore welcomes foreign entrepreneurs and provides various schemes and incentives to encourage foreign investment. As a foreigner, there are a few key considerations to keep in mind when starting a business in Singapore. These include obtaining the necessary work permits or visas, understanding legal requirements, and navigating the regulatory landscape. By adhering to these guidelines, foreigners can confidently embark on their entrepreneurial journey in Singapore.
Step 1: Develop a Comprehensive Business Plan
The first step is to create a robust business plan that encompasses key areas such as vision and mission statements, market analysis, target audience identification, product and service offerings, marketing strategies, financial considerations, logistics, and operations. Within the plan, it is important to address capital costs and fixed costs, as they play a significant role in starting a small business in Singapore. Capital costs refer to one-time expenses required to establish the business, while fixed costs encompass recurring expenses on a monthly or yearly basis. Additionally, when selecting a company name, ensure its uniqueness and memorability, while adhering to government restrictions that prohibit certain terms like “bank,” “insurance,” “university,” and “education” without obtaining special permits from specific government offices.
For foreign businesses starting their own ventures in Singapore, they can choose among the following company types:
- Private Limited Company
- Limited Liability Partnership
- Sole Proprietorship
Each of these entities possesses distinct features and advantages, so it is essential to carefully evaluate and select the most suitable structure for your business’s future growth.
Step 2: Register the New Company
During the registration process, include pertinent details about your business, such as a brief description, information about the corporate secretary and nominee director (with at least one director being a Singapore citizen). If you lack a Singaporean partner, One IBC’s nominee director service can be a valuable resource. Furthermore, a local address must be registered for receiving legal correspondence, which can be conveniently managed through One IBC’s serviced office package. It’s important to note that foreigners cannot self-register a company and must engage an authorized third party. As a certified corporate service provider, One IBC can assist foreign business owners in setting up their small business entity in Singapore, ensuring a streamlined and efficient process.
Step 3: Open a Bank Account
After successfully registering your new Singapore company, it is advisable to open a local bank account for your business. Singapore is home to several internationally renowned banks and financial institutions. Having a bank account in Singapore offers numerous advantages. However, the banking laws in Singapore are stringent, and the application process can be time-consuming. Additionally, banks enforce a Know Your Customer (KYC) policy, requiring applicants to undergo an in-person interview. Simplifying this process, One IBC provides comprehensive support to customers, enabling them to open bank accounts from anywhere in the world. Our professional experts assist with application preparation and offer coaching for KYC interviews.
Step 4: Establish an Accounting Routine
In Singapore, companies are required to submit various tax reports to the government, even if the company has no transactions. These reports include Estimated Chargeable Income (ECI), financial statements, and annual tax returns (Form C or Form C-S). As many small businesses for foreigners in Singapore may not have an in-house accounting team, managing these requirements can be challenging. One IBC’s accounting and auditing service provides peace of mind by assisting companies with these paperwork obligations. Our knowledgeable staff, many of whom have prior experience as public accountants and auditors, ensure that this step is handled efficiently and professionally.
Best business to start in Singapore
Singapore offers a diverse range of industries and sectors that present excellent business prospects. While the choice of the best business to start ultimately depends on individual preferences and market trends, some sectors have proven to be particularly lucrative in Singapore. These include technology and innovation, financial services, logistics and supply chain, healthcare, and e-commerce. Conducting thorough market research and identifying untapped niches within these sectors can help entrepreneurs make informed decisions and capitalize on emerging opportunities.
For foreign businesses starting their own ventures in Singapore, they can choose among the following company types:
- Private Limited Company
- Limited Liability Partnership
- Sole Proprietorship
Cost of setting up a company in Singapore
Understanding the cost implications of setting up a company in Singapore is essential for any aspiring entrepreneur. While the costs may vary depending on the business structure and specific requirements, it is crucial to factor in expenses such as company registration fees, office space rental, licenses and permits, employee salaries, and ongoing operational costs. By carefully budgeting and planning, entrepreneurs can make informed financial decisions and ensure a solid foundation for their business.
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6 main steps to start a business in Singapore generally
Starting a business in Singapore involves a systematic process that requires adherence to specific steps. These steps typically include:
Step 1: Select an Appropriate Business Structure
Selecting the right business structure is crucial, whether you are operating your business independently or with partners. There are several options to choose from, including sole proprietorship, partnership, and company. Each structure offers its own advantages and factors to consider.
Step 2: Select a Suitable Business Address
Choosing an appropriate business address is an important step in the registration process with ACRA (Accounting and Corporate Regulatory Authority). It is important to note that a P.O. Box address cannot be used as a business address.
For businesses operating as sole proprietorships, partnerships, limited partnerships, local companies, or limited liability partnerships, a business address must be provided during registration.
Additionally, all business owners and company officers are required to provide their residential address, which becomes publicly available when information about the business entity is accessed by the public.
If you prefer to maintain your privacy, you have the option to submit an Alternate Address for a fee of $40. However, you must still provide ACRA with your home address for records..
The Alternate Address will be displayed on public records in place of your personal residential address. It is essential to ensure that you can be contacted at the Alternate Address you provide.
Step 3: Reserve Your Chosen Business Name
In this step, you need to select and reserve a name for your business. To facilitate this process, utilize the e-Adviser for Starting a Business, which offers the following features:
- Name Availability: Use the e-Adviser to check if there are any existing businesses with similar names. Additionally, you can verify if your chosen name is available as a domain name or as a username on popular social media platforms like Facebook, Instagram, YouTube, and Twitter.
- Guided Journey: Access the Guided Journey feature provided by the e-Adviser to receive step-by-step guidance on starting your business. This resource will also inform you if there are any additional approvals or permits required.
- Trademark Check: Utilize the IP2SG portal to determine if there are any similar trademarks already registered.
If you have decided on a business name for your Sole Proprietorship or Partnership, you can reserve the name through the GoBusiness platform using the e-Adviser.
Step 4: Complete Business Registration
The business registration process consists of two steps: applying for a business name and subsequently registering the business. Please refer to Step 3 (Reserve your business name) for instructions on how to apply for a business name. Once your chosen name has been approved, you can proceed with the registration process.
There are three methods available to register your business:
For Sole Proprietorship/Partnership:
- Register directly through GoBusiness:
- Log in using your Singpass credentials.
- Utilize the Guided Journey feature to proceed with the registration of your Sole Proprietorship/Partnership.
For all types of business structures:
- Register directly through BizFile+.
- Alternatively, you can engage a registered filing agent, such as a law firm, accounting firm, or corporate secretarial firm, to submit an online application on your behalf.
Depending on the type of business structure you have selected, there are different requirements, information requirements, and supporting papers for the business registration application.. Click on the respective business structure to access detailed information about the specific requirements
Step 5: Establish a Corppass Administrator Account
After successfully registering your business, the next crucial step is to create a Corppass Administrator (Admin) account. This account is essential for conducting transactions with Singapore Government agencies. Corppass serves as a unified digital identity for your business and is accessed using your personal Singpass credentials. However, you must still provide ACRA with your home address for records..
Corppass Admins possess the following capabilities:
- Manage User Access: Admins can control and manage users’ access to various digital services.
- Customize Service Access: Admins can customize the digital service access for individual users within the business entity.
- Authorize Third-Party Service Providers: Admins can authorize selected third-party service providers to transact on behalf of the business for specific digital services.
There are two methods to register for a Corppass Administrator Account:
1) Register via GoBusiness:
- Log in using your Singpass credentials.
- Utilize the e-Advisor for Starting a Business, which provides a Guided Journey to assist you.
- Apply for a Corppass Administrator Account through the platform.
2) Register via the Corppass portal.
Choose the method that suits you best to proceed with the registration of your Corppass Administrator Account.
Step 6: Establish a Corporate Bank Account
It is highly recommended to open a dedicated corporate bank account for your business. Having a corporate bank account enables you to maintain a clear separation between your personal and business transactions. It also facilitates the effective tracking of your business’s cash flows, including income and expenses. This separation and financial tracking will be invaluable when it comes to filing your income tax returns accurately and efficiently.
