Considering a subsidiary entity set up in Singapore comes with risks. The venture can be costly, time-consuming and has no guarantee of success. Non-resident companies must open a legal entity to operate payroll in Singapore and generally opt for establishing a private limited liability subsidiary, particularly as a small and medium-sized operation, to gain a foothold in Singapore’s economy. Singapore is a financial and commercial powerhouse at the heart of Asian economies and a prime target for international expansion. Singapore’s pedigree is impressive. It is the only Asian nation with a Triple AAA credit rating, a hub for east and west shipping lanes (with the world’s second-largest port), while 50% of the world’s population is a six-hour flight away.
However, expanding overseas is a significant step, especially for companies opening a legal entity in their new territory thousands of miles from their home base. If the move fails, companies face the extra expenditure and stress of closing the business, selling property and paying off employees. The sensible alternative is to use a Professional Employment Organisation (PEO) and Employer of Record (EOR) such as Bradford Jacobs to locate the finest local talent and administer your payroll in Singapore speedily and risk-free. Your company will be up-and-running in days rather than weeks or even months.
A subsidiary entity set up in Singapore is a legal requirement for international companies planning to hire staff and run payroll. They typically choose to establish a limited liability company, which can be wholly foreign-owned and operates under the Singapore Companies Act. The Act covers incorporation, shares and shareholder regulations, duties of directors and officers, accounting, audits and other provisions.
General procedures and requirements include:
Specific advantages for a foreign company opening a private limited liability company in Singapore include the entity having a separate legal identity from the parent company. The subsidiary operates under the Singapore Companies Act, and the parent company’s liability is generally limited to its invested share capital. The same applies to its shareholders. The subsidiary is eligible for tax incentive schemes as a local and legal entity.
Through its subsidiary, the parent company has the advantage of maximizing opportunities of expanding further into Asia and the Pacific Rim. And Singapore is the ideal launch pad for such expansion. It is the only Asian nation with a Triple AAA credit rating, a focal point for east and west shipping lanes (with the world’s second-largest port), while 50% of the world’s population is a six-hour flight away.
Other benefits for a subsidiary:
In the broader commercial sense, opening a subsidiary makes a statement of a company’s commitment to expanding into foreign markets, in this case, the opportunities offered by Asian and Pacific Rim economies.
However, there is a more straightforward option to the risks and costs of setting up a subsidiary in Singapore by working with Bradford Jacobs. Using a PEO such as Bradford Jacobs means staff can be sourced, placed in their roles and be up and running within days rather than months. All the payroll, taxation and compliance difficulties are under control thanks to our EOR services.
Foreign-owned subsidiaries in Singapore operate under the Companies Act and must incorporate under its laws.
Registration and Documentation:
Accounts and Taxation: