How to Incorporate Your Online Business in Singapore?
We are ready to use 5G internet. And today, investing in Singapore company incorporation process to start an online business is a better decision than setting up a brick and mortar shop. Here is information on how to incorporate your online business in Singapore.
How to Set Up an Online Business in Singapore?
Maybe at this stage, you are struggling with several questions about Singapore company incorporation.
- Do I need to register my online business with ACRA in Singapore?
- Can a foreigner register a Singapore company?
- What are the benefits?
If your online activity is going to earn you money on a continual basis, you need to legitimate it. As per the Company Law of Singapore, you need to register a company to do so.
Do not get confused with the phrase “incorporating an online business in Singapore.” There is no special legal business structure dedicated to online businesses. It means starting a regular Singapore company for conducting business using the internet.
So, if you set up a normal company like everyone else, you are ready to do business. Your blog, e-commerce or business website will be part of the assets of your company.
Legal Structures You Can Use to Incorporate Your Business
Yes, you were right about incorporating your online business, you need to apply to ACRA – the Company Registrar of Singapore. Use one of the business structures listed below:
- Private Limited Company (Pte Ltd)
- Sole Proprietorship
- Limited Liability Partnership
Starting Online Business as a Pte Ltd
You will be better off by registering a private limited company.
- Pte Ltd is dynamic and scales properly to accommodate a growing business.
- It limits your liabilities to the amount of capital you have invested in its shares.
- It is responsible for its debts and liabilities.
- Your personal assets are not at risks.
- It is a separate legal entity.
- It can sue or be sued in its own name. It means you need not have to get involved in its legal battles at the personal level.
You will be able to make educated decisions if you know the more about how a Pte Ltd, Sole Proprietorship, & an LLP differs. If you know more about Singapore taxation, you will see why other business owners prefer setting up a Pte Ltd.
- The company tax rates applicable to Pte Ltd are in the range of 0%-17%.
- The company tax rates applicable to owners of Sole Proprietorship and members of Limited Liability Partnership are in the range of 0%-22%.
Official ACRA Fees for Setting Up a Company in Singapore
When you go to ACRA to incorporate your online business, the agency charges you:
- S$15 for registering the name of your company
- S$300 for starting your company
If you are a Singaporean or Permanent Resident, you can self register your private limited company. However, engaging one of the reputed registered filing agents is more practical.
Registered Filing Agent for Foreigners
Foreigners cannot self-register their Singapore company. So, if you are one, hire an agent for the purpose. Their experts will advise you on the steps of Singapore company incorporation process and the documents you need to make ready. If something goes wrong, they will appeal to the appropriate authorities on your behalf.
Pre Incorporation Requirements for Starting a Singapore Company
Before applying to ACRA, make sure you fulfil the following requirements:
- At least 1 shareholder (maximum of 50)
- Minimum initial paid-up capital of S$1
- At least 1 company secretary
- S$300 for starting your company
- At least 1 local director
- The local registered address for your company
Choose Your Company Name Carefully
You should be careful in choosing the name for your company:
- It should not be identical to other existing companies.
- Make sure that the domain name of your blog, e-commerce or business website matches your company name.
- Make sure that the domain name of your blog, e-commerce or business website matches your company name.
- It should not violate copyrights or trademarks of existing companies.
- ACRA rejects vulgar, black-listed, or inappropriate names.
Post Incorporation Activities
There are a few other tasks that you must complete after starting your company and before starting your business activities.
Create a Business Website: Today, your customers automatically expect you to have a business website and a strong presence on social media and other platforms. It is the reason why you need to create a website that is beautiful and easily navigable. It will act as the face of your business.
You also need to be prepared with the market research and marketing campaigns to promote your website and products to your target customers. Publishing content that accurately addresses the needs and goals of your customers can go a long way in attracting them to it.
Permits and Licenses: The next step in your Singapore company incorporation journey is to acquire the necessary licenses and permits from the appropriate authorities. Their number and type will vary depending on the products or services you want to sell through your online business.
Corporate Bank Account: Open a corporate bank account for your new business. It will help you by streamlining business’ finances. You can use it to accept payments from your customers and pay for the required utilities, services, and products.
Contract & Lease Agreement: During the course of your business activities, if you may need to lease or rent properties, office spaces, or machinery. Sign the lease agreements, business contracts (suppliers) and service agreements (customers) under your company name.
Register Your company for GST: You expect your yearly business turnover to exceed S$1 million. Register your business for Singapore Goods and Services Tax (GST). You will need to collect 9% of tax from your customers and pay it to the IRAS at the time of GST filing.
Open MOM / CPF Account: Fill and file appropriate MOM and CPF forms to open a CPF account for your business. Transfer adequate funds to it.
Bookkeeping, Accounting, & Auditing Increases Success Rate of Business
You have to be very careful with your business’ funds and manage its cash flow. Failing to do so will spell doom for your business. A large number of businesses fail because they fail to control or eliminate unwanted expenses and manage their money.
You need to be very strict with your bookkeeping and accounting.
Collect receipts and store them securely. Record each of, even insignificant once, your business financial transactions accurately.
If you must, hire an experienced accountant for your business. Having updated financial records helps greatly in accounting and statutory compliance. Auditing lets you know its financial health and the necessary steps to grow it to the next level.
Company Secretary Sees to the Business’ Compliance
As per law, you must hire a qualified company secretary for your business in Singapore. These professionals take care of the legal aspect of the business. They coordinate with the various regulating authorities and ensure its statutory compliance.
The secretaries also communicate with the shareholders, convey, and hold company AGM as per the rules. They also take care of the registers of the company. They see to the timely annual filing of the company. In short, they can take a load of legal work, including XBRL filing off your back and let you be free to grow your company.
Indulging in Singapore company incorporation means being responsible for its and employee’s welfare. There are way too many processes and logical paths involved in running a successful company. And, as the master of your company, you have to coordinate efforts and resources to make them work for its success.
SBS Consulting Pte Ltd is a well-known Singaporean registered filing agent. For queries regarding how to incorporate your online business in Singapore, email us at info@sbsgroup.com.sg or call us on +65 6536 0036 for answers.
