Support For Incorporating in Singapore

By Lawrence R Smith

Singapore is highly reputable for its efficiency, lawfulness and for being one of the least corrupt countries in the world. It is up to date with the latest in technology making it a very digitalized country. A fast, efficient and inexpensive public transport system along with a well-planned and well-connected road network make commuting extremely easy. These traits, along with a conducive business environment make Singapore a desired destination for company incorporation.

Singapore often ranks highly in business surveys focused on a range of company incorporation and business operational aspects. For example, Singapore is ranked the easiest place in the world to do business in the Doing Business 2010 Report. The Heritage Organisation ranks Singapore as the second freest economy in the world in their 2010 Index of Economic Freedom report. The latest accolade for Singapore is being ranked number 1 in the 2010 World Competitiveness Scoreboard. From a ranking of 3rd in the 2009 report, Singapore overtook Hong Kong and USA to take the top spot. These top 3 jurisdictions were seen as very close but it is quite an accomplishment for two relatively small markets to be equally recognized against the world’s largest economy. The methodology takes into account aspects including economic performance, government efficiency, business efficiency and infrastructure. Efficiency and infrastructure are two areas where Singapore excels and key factors in its success as an Asia hub.

Singapore is conveniently located and connected to regional markets such as China, India, Australia, Vietnam, Malaysia and Indonesia. Singapore is home to the world’s largest transshipment seaport with connection to more than 600 ports in 123 countries. With the economic liberalization of the many neighbouring countries, Singapore serves as an ideal springboard for the numerous entrepreneurs who wish to expand their export trade and globalize their business. It is the gateway to Asia and beyond.

Singapore is often recognized as having great investment potential, with established export markets between Malaysia, Hong Kong, Indonesia, China, the US and more. The pharmaceutical and biotechnology are also significant industries in Singapore, supported by a S$500m research facility.

Latest economic growth statistics illustrate a strong recovery for the Singapore economy. Year-on-year GDP grew by 15.5% for the first quarter of 2010. Despite the potential issues with European economies, the Singapore government is confident of maintaining forecasts of around 8% GDP growth for 2010.

Singapore has a broad network of double taxation avoidance agreements, involving over 60 countries, to ensure fair taxation of all companies incorporated in Singapore and has one of the most extensive network of free trade agreements (FTAs) in Asia. One of the newly ratified double tax agreements is with New Zealand and will enter into force once singapore fulfills the legal requirements. A reduction of withholding taxes is one key benefit of this DTA amendment.

The other major tax incentives for Singapore company incorporation is a tax exemption on all profits sourced outside of Singapore. Furthermore, for the first three years of business operation, the first S$100,000 of corporate profits sourced within Singapore are 100% legally tax exempt and 50% of the next S$200,000 of locally sourced corporate profits have 50% tax exemption. As a result of such favourable tax policies, Forbes rates Singapore as having the 11th lowest tax misery in the world.

With all the advantages Singapore presents, it is easy to understand how Singapore is a key business hub in Asia and an ideal jurisdiction for company incorporation. Despite its size, Singapore provides important policies, infrastructure and business establishments that are key incentives for entrepreneurs who wish to incorporate their business in Asia.

Healy Consultants is a leading corporate services firm, headquartered in Singapore, and working with clients across a range of categories to maximize the benefits enjoyed by their Singapore company formation. For more information, visit www.healyconsultants.com or email them at email@healyconsultants.com

Leave a Reply