Foreign entrepreneurs who wish to establish their company and reside in Singapore have two options to choose from: Entrepass and Employment pass. Each one has its own advantages in terms of ease of approval, processing period and mandatory requirements.
1. EntrePass
2. Employment Pass
The Entrepass, designed to facilitate the entry and stay of entrepreneurs who are ready to start a new business and who will be actively involved in the operation of the company in Singapore, the EntrePass, with an initial validity period of up to 2 years will be issued upon the submission of a sound business proposal. The EntrePass also allows your immediate family to live in Singapore while you start and grow your business here. With the EntrePass you may leave and re-enter Singapore frequently with ease. It is renewable for as long as the business remains viable.
EntrePass applicants will be assessed on the credibility of their proposed Business Plan, which should include the objective or nature of the business, products or services to be offered; marketing strategies, development plans and milestones, projected sales turnover, intended amount of investment and staffing plan.
Most Entrepreneurs will have no problem getting an EntrePass visa approved, although the approval is dependant on the type of business you intend to set up, how you prepare and present your Business Plan, your current citizenship, the amount of capital investment, local job creation, your past work experience and possibly your education level.
Preparing a good Business Plan for your application is one of the most crucial aspects of acquiring an EntrePass Visa. A well thought-out Business Plan markedly improves your chances of getting a Singapore EntrePass.
EntrePass Processing Time
The process of assessing an EntrePass application should be around 25 days from the date of receipt. It is important that all information and supporting documents requested are submitted correctly to ensure fast approval. An incomplete application will lengthen processing time and may result in rejection.
Validity of EntrePass
If your application is successful, you will normally be issued an EntrePass that is valid for two years. You do not need to incorporate your business in Singapore until the successful outcome of your EntrePass application.
Your EntrePass and dependants passes allow you to bring your immediate family members to Singapore to live with you.
05 October 2008
04 October 2008
Society
A society is defined in the Societies Act as a club, company, partnership or association of 10 or more persons, whatever its nature or object, and not already registered under any other law.
A society should hold its Annual General Meeting in accordance with the provision in the society's constitution. It is required to submit its Annual Return and audited accounts within a month of the holding its Annual General Meeting.
A society should hold its Annual General Meeting in accordance with the provision in the society's constitution. It is required to submit its Annual Return and audited accounts within a month of the holding its Annual General Meeting.
Limited Liability Partnership (LLP)
The limited liability partnership is a relative newcomer to the Singapore business world and sits between partnerships and private limited companies. LLPs were introduced to provide a business vehicle which has the flexibility of a partnership, with the benefit of limited liability.
LLPs do not have directors, shareholders or partners. Instead they just have members, who own and run the business. LLPs are taxed in a similar manner as partnerships. This means that members of LLPs are treated as if they are carrying on business personally and taxed as self-employed. The members of LLPs are also treated for taxation purposes as owning the assets of the business personally.
However this comes with safeguards in law to minimize abuse and provide protection to parties who deal with the LLP. The LLP is a body corporate and has legal personality separate from its partners. The LLP has perpetual succession. Any change in the partners of a LLP does not affect its existence, rights or liabilities.
An LLP is capable of:
LLPs do not have directors, shareholders or partners. Instead they just have members, who own and run the business. LLPs are taxed in a similar manner as partnerships. This means that members of LLPs are treated as if they are carrying on business personally and taxed as self-employed. The members of LLPs are also treated for taxation purposes as owning the assets of the business personally.
However this comes with safeguards in law to minimize abuse and provide protection to parties who deal with the LLP. The LLP is a body corporate and has legal personality separate from its partners. The LLP has perpetual succession. Any change in the partners of a LLP does not affect its existence, rights or liabilities.
An LLP is capable of:
- Suing and being sued in its name;
- Acquiring and holding property in its name;
- Having a common seal and
- Doing such other acts and things in its name, as bodies corporate may lawfully do and suffer.
Companies Limited by Guarantee
The liability of members is limited to such amount as they undertake to contribute to the assets on winding-up. That amount is specified in its memorandum of association, which forms part of a company's constitution. If the company is wound-up, each person who is a member at that time or has been a member within one year of winding up may be required to contribute up to the amount of his guarantee towards payment of the debts incurred while he was a member. Past members are liable only if the present members default. Such companies are invariably non-profit-making concerns. They include professional bodies, trade societies, clubs etc.
Singapore Private Limited Company
A company is a business entity registered under the Singapore Companies Act, Chapter 50. Unlike a business firm such as a sole proprietorship or partnership, it has a legal personality i.e. it has rights to own properties, can sue or be sued. It usually has the words 'Pte Ltd' or 'Ltd' as part of its name. In many European or the USA, it is commonly known as a Corporation.
A private limited company has its own legal identity, separate from its shareholders (who own the company) and its directors (who manage the company). Companies pay corporation tax on their profits, Shareholders receive dividends which are tax free under the Singapore new one tier tax system and directors pay income tax as employees officers on any remuneration paid.
One of the major advantages of a limited company is that the shareholders are not liable for the company's debts beyond the amount of share capital they have subscribed, provided there has been no deceit, fraud or malpractice.
Another advantage of such a company is that it is easy to transfer the ownership, either wholly or partially, through the selling of all or part of its total shares, or through the issue of new shares to additional investors. There is no need to wind up the company in the event of deaths, or changes amongst the shareholders or directors.
In Singapore, a company can be incorporated in one of the following ways:
There are two types of Private Companies Limited by Shares
Private Company
This is a locally incorporated company where the number of shareholders is limited to 50.
Exempt Private Company
An exempt private company is a private limited company, of which all shares are not held directly or indirectly by any corporation (i.e. another limited company), and which has not more than 20 members. An exempt private company need not file its annual accounts with the ACRA for the information of the public as long as the company files a Certificate of an Exempt Private Company, that the company is able to meet its liabilities as and when they fall due.
Advantages
A private limited company has its own legal identity, separate from its shareholders (who own the company) and its directors (who manage the company). Companies pay corporation tax on their profits, Shareholders receive dividends which are tax free under the Singapore new one tier tax system and directors pay income tax as employees officers on any remuneration paid.
One of the major advantages of a limited company is that the shareholders are not liable for the company's debts beyond the amount of share capital they have subscribed, provided there has been no deceit, fraud or malpractice.
Another advantage of such a company is that it is easy to transfer the ownership, either wholly or partially, through the selling of all or part of its total shares, or through the issue of new shares to additional investors. There is no need to wind up the company in the event of deaths, or changes amongst the shareholders or directors.
In Singapore, a company can be incorporated in one of the following ways:
There are two types of Private Companies Limited by Shares
Private Company
This is a locally incorporated company where the number of shareholders is limited to 50.
Exempt Private Company
An exempt private company is a private limited company, of which all shares are not held directly or indirectly by any corporation (i.e. another limited company), and which has not more than 20 members. An exempt private company need not file its annual accounts with the ACRA for the information of the public as long as the company files a Certificate of an Exempt Private Company, that the company is able to meet its liabilities as and when they fall due.
Advantages
- Limited liability for shareholders. This means that if the company fails, the shareholders may lose the entire value of their shares but no more, unless they have given guarantees.
- A company has its own legal identity. This means that, it can enter into legal agreements, it can own property, it can sue and be sued all in its own name. It will continue to exist, even if its shareholders or directors die, resign or go bankrupt.
- It is easier to transfer the ownership of a company than an interest in a partnership, as all that is required is a transfer of shares, subject to the company's constitution.
- Clear structures are laid out in the Companies Act governing the organisation and procedures to be followed by companies.
- The minimum number of shareholders and directors is one.
- Companies may find it easier than partnerships to borrow, as they are able to create floating charges over their assets.
- Incorporation is sometimes seen as supporting an image of status and credibility.
- Exempt Private Limited companies owned by individual shareholders need not audit its accounts if the company's annual turnover falls below S$5 million.
- Companies are governed by tighter rules and regulations than partnerships. For example, they must follow the detailed rules and procedures set out in the Companies Act. Company accounts must show more information than the accounts of a partnership and companies must have at least one director and one company secretary.
- Companies face greater disclosure and administration requirements than partnerships. Therefore, the running costs for a company are generally higher than for a partnership. For example, they must file annual audited accounts or FRS or Directors' Report if they are exempted from audit and returns with ACRA (Registrar of Companies), with penalties if they are late. These can be publicly available
- Directors must not make any secret profit out of their position and they must exercise their powers for the benefit of the company.
- Directors must disclose to the company certain information about their interests in the company's shares, contracts and debentures.
- There are restrictions on the freedom of the company to enter into contracts or arrangements with its directors.
- A director is always subject to removal by an ordinary resolution passed by the shareholders.
- Directors can have personal liability in some circumstances, for example if they breach their duties to the company, or if they commit wrongful or fraudulent trading.
- Limited liability may mean very little in practice, if the directors or shareholders have to give personal guarantees to banks or landlords.
- Ceasing to trade can be more difficult and costly than in the case of partnerships, as the business belongs to the company, and that company will need to be correctly wound up.
- Companies can be more expensive to set up than partnerships.
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