Introduction
Singapore has long been recognized as one of the best places in the world to start and run a business. Its efficient government, robust economy, pro-business policies, and strong legal framework make it a natural choice for entrepreneurs from all over the world.
For foreign investors, Singapore’s appeal goes far beyond its skyline. The country offers a stable environment, straightforward incorporation procedures, low taxes, and excellent access to global markets. Whether you’re an aspiring startup founder or a well-established business owner planning to expand into Asia, incorporating a company in Singapore is a powerful step toward long-term success.
This article explores how foreigners can set up a company in Singapore, what requirements must be met, and why this small city-state continues to attract international entrepreneurs.
Why Foreigners Choose Singapore
1. A Stable and Reliable Business Environment
Singapore’s political system is known for its consistency and transparency. The government’s strong anti-corruption stance and effective public administration make it one of the safest and most predictable business destinations worldwide. Companies can focus on growth, confident that regulations are clear and fairly enforced.
2. Strategic Position in Asia
Located at the intersection of major Asian trade routes, Singapore serves as an ideal launchpad for businesses expanding across Southeast Asia and beyond. With excellent air connectivity, a world-class seaport, and an efficient transport network, companies based in Singapore can reach regional and international markets with ease.
3. Favourable and Simple Tax System
Singapore’s tax framework is one of the most competitive globally. The corporate income tax rate stands at a maximum of 17%, with generous exemptions for new startups. There are no capital gains taxes, and foreign income not remitted into Singapore is tax-free. These benefits make the city an attractive base for global operations.
4. Skilled Workforce and Advanced Infrastructure
The nation’s education system produces a skilled, bilingual workforce fluent in English — the language of business. Combined with world-class infrastructure, reliable internet connectivity, and a strong financial sector, Singapore provides everything a modern business needs to thrive.
5. Extensive International Agreements
Singapore’s network of Free Trade Agreements (FTAs) and Double Taxation Avoidance Agreements (DTAAs) allows companies to operate internationally with fewer barriers and reduced tax exposure. For foreigners, this means smoother trade and higher profitability when doing business across borders.
Can a Foreigner Fully Own a Company in Singapore?
Yes, foreigners can own 100% of a Singapore company. There is no need for a local partner or shareholder. However, there are certain statutory requirements to meet — most importantly, the appointment of at least one local director.
The resident director must be:
- A Singapore Citizen,
- A Singapore Permanent Resident, or
- A holder of an Employment Pass (EP) or EntrePass with a local residential address.
This ensures that every company has at least one person who is locally accountable to Singapore’s authorities.
Business Structures Available to Foreigners
When incorporating a company in Singapore, foreigners can choose from several business entity types depending on their goals.
1. Private Limited Company (Pte Ltd)
The most common structure, a Private Limited Company, is considered a separate legal entity from its owners. It offers limited liability protection, strong credibility, and access to tax incentives. Most foreign entrepreneurs choose this structure for long-term operations.
2. Subsidiary Company
A subsidiary is a locally incorporated Pte Ltd where the foreign parent company holds a majority of shares. It is treated as a local entity for tax purposes, which makes it eligible for Singapore’s tax benefits and government grants.
3. Branch Office
A branch office operates as an extension of a foreign parent company. It is not considered a separate legal entity and therefore, the parent company remains fully responsible for its obligations and liabilities. This structure suits established companies looking to replicate their business activities in Singapore.
4. Representative Office
A representative office cannot generate income or sign contracts. Its role is limited to market research, feasibility studies, or acting as a liaison. This is often a temporary setup for companies testing the market before formal incorporation.
Incorporation Requirements for Foreigners
Foreigners must meet several requirements before setting up a company in Singapore:
1. Company Name Approval
The proposed name must be approved by the Accounting and Corporate Regulatory Authority (ACRA). It should be unique and not conflict with existing business names or trademarks.
2. Directors
At least one resident director must be appointed. The rest of the directors can be foreigners and do not need to reside in Singapore.
3. Shareholders
A company must have between 1 and 50 shareholders, which can be individuals or corporations. Foreigners are allowed to hold 100% of the company’s shares.
4. Paid-Up Capital
The minimum paid-up capital requirement is S$1. However, setting a higher initial capital, such as S$1,000 or more, is common for credibility.
5. Registered Office
A local Singapore address (not a P.O. Box) must be provided as the company’s registered office for official correspondence.
6. Company Secretary
Every company must appoint a qualified company secretary within six months of incorporation. The secretary must be a Singapore resident and is responsible for ensuring regulatory compliance.
7. Auditor
Unless exempted as a “small company,” every business must appoint an auditor within three months of incorporation.
A company qualifies as “small” if it meets at least two of these:
- Annual revenue ≤ S$10 million
- Total assets ≤ S$10 million
- Employees ≤ 50
How to Incorporate a Company in Singapore as a Foreigner
Step 1: Hire a Licensed Corporate Service Provider (CSP)
Foreigners cannot directly register a company with ACRA. You must engage a licensed Corporate Service Provider — such as an incorporation, accounting, or corporate secretarial firm — to handle all procedures and ensure compliance.
Step 2: Reserve a Company Name
The CSP will submit your preferred name through ACRA’s BizFile+ system. Once approved, the name is reserved for 120 days while you prepare incorporation documents.
Step 3: Prepare Required Documents
You’ll need to provide:
- A company constitution
- Details of shareholders, directors, and shareholding structure
- Copies of passports and proof of address for all foreign individuals
- The local registered office address
Step 4: Submit Incorporation Application
Your CSP will electronically file your application. Upon approval, you will receive an official Certificate of Incorporation and Unique Entity Number (UEN) — the company’s identification number in Singapore.
Step 5: Open a Corporate Bank Account
You can then open a corporate bank account with Singapore banks such as DBS, OCBC, or UOB. Most banks prefer face-to-face verification, though some offer remote options depending on your profile and business nature.
Step 6: Apply for a Work Visa (If Relocating)
If you plan to move to Singapore to run your company, you’ll need a valid work pass such as:
- Employment Pass (EP): For professionals or directors with a minimum salary of S$5,000 per month.
- EntrePass: For innovative entrepreneurs developing high-growth businesses.
Step 7: Maintain Ongoing Compliance
After incorporation, companies must:
- Hold Annual General Meetings (AGMs)
- File Annual Returns with ACRA
- Submit tax filings to the Inland Revenue Authority of Singapore (IRAS)
- Maintain proper financial records and bookkeeping
Post-Incorporation Considerations
1. Corporate Banking and Transactions
Singapore’s banking system is among the most trusted globally, offering multi-currency accounts and international payment solutions. Opening a corporate account simplifies day-to-day financial operations.
2. Business Licenses
Some sectors, such as F&B, healthcare, or education, require additional licenses. These should be obtained before starting operations.
3. Accounting and Tax Obligations
Even if your company is new, you must maintain proper accounting records and file annual returns. Many foreign owners outsource this function to local accounting firms for convenience.
4. Hiring Employees
The Ministry of Manpower regulates employment matters. Employers can hire locals and foreigners, subject to work pass eligibility and quotas.
5. Choosing an Office Space
Options range from virtual offices (for non-resident founders) to co-working spaces and traditional offices in central business districts like Marina Bay or Raffles Place.
Advantages of Setting Up a Singapore Company as a Foreigner
1. Global Trust and Reputation
A company incorporated in Singapore is viewed as professional and credible. This enhances investor confidence and strengthens partnerships with international clients.
2. Attractive Tax Benefits
Startups can enjoy partial tax exemptions for the first three years, with up to 75% exemption on the first S$100,000 of chargeable income. This provides new businesses with significant cash flow advantages.
3. Vibrant Business Ecosystem
Singapore supports entrepreneurship through government grants, venture capital funds, and innovation hubs. The city is also home to multinational corporations and startups, creating endless collaboration opportunities.
4. Freedom to Repatriate Profits
There are no exchange controls or restrictions on moving profits out of Singapore. This gives foreign entrepreneurs full flexibility in managing international finances.
5. Efficient and Digitalized System
From incorporation to tax filing, most business processes are online. This makes it convenient for foreign owners to manage their operations remotely.
Challenges to Keep in Mind
While Singapore’s incorporation process is straightforward, foreigners may face a few hurdles:
- Finding a Resident Director: Required for all companies.
- Bank Account Opening: Some banks require in-person meetings and extensive verification.
- Work Visa Approvals: Applications are subject to the Ministry of Manpower’s review.
- Compliance Maintenance: Missing filing deadlines can lead to fines or penalties.
Partnering with an experienced corporate service provider can help navigate these challenges efficiently.
Conclusion
Setting up a company in Singapore as a foreigner is a strategic move that brings access to one of the world’s most advanced and business-friendly economies. With its stable governance, transparent systems, and advantageous tax environment, Singapore stands out as the preferred choice for entrepreneurs aiming to expand into Asia.
Although certain compliance requirements must be met, the overall incorporation process is quick and straightforward — especially when supported by professional incorporation experts.
For ambitious entrepreneurs seeking a trusted, global base with unmatched connectivity and growth potential, Singapore offers the perfect balance of opportunity, reliability, and ease of doing business.