Why invest in Singapore? Fluent English, development as a financial hub perfect for cross-border trade, excellent infrastructure, and a revolutionary legal and regulatory framework are just some of the reasons Singapore is considered the major investment and financial hub in Asia. Let us explore the reasons why Singapore is a great destination for future investment and business ventures.
Why structure your Asia investments with a Singapore company?
- English is the main language
English has been the pre-dominant language in Singaporean schools since 1970. Even though Malay, Mandarin, and Tamil are still spoken in Singapore, the main (business) language is English. Most Singaporeans are bilingual, using their native Malay and English in conjunction. English serves as the function of being the official language and language of administration. This makes it easier for foreign individuals and businesses to do business and operate in Singapore.
- Excellent Reputation of Singapore
Singapore is welcoming towards overseas businesses setting up. Its reputation as one of Asia’s top financial hubs has exceeded itself and attracts foreign investments. Many multinationals have already established a presence in the small country. Another major attraction point is that Singapore houses the biggest foreign exchange center in the Pacific/Asia region and the third largest in the world. This is all thanks to its stance on promoting international trade and business through free trade agreements with all major countries surrounding it.
Tax on corporate income in Singapore is a flat 17%. For qualifying start-up companies, partial tax exemption and a three-year start-up tax exemption are available. For the first 300,000 SGD (approx. €210.000,-) of chargeable income, you are able to receive a partial tax exemption. Under this condition, 75% of the first 100,000 SGD is fully tax-exempt. 50% of the remaining 290,000 SGD of chargeable income is also tax-exempt. To be eligible for this, your start-up company does have to be a tax resident of Singapore. Also, Singapore has no dividend withholding tax, assuring that shareholders receive the whole sum of the dividend for their stake. All goods and services in Singapore are subject to a Goods and Services Tax (GST) at a flat rate of 7%.
Combine these benefits above with more than 90 Tax Treaties signed, and you have an amazing destination for future business endeavors.
Singapore maintains an adamant stance on its free flow of goods, services, capital, and data. Its status as an open and trading nation is sacred. Having a free flow of capital means there is no restriction to the flow of capital in and out of Singapore, including both long-term foreign direct investment as well short-term capital flows. This makes it easier for companies to receive investments and flow their dividends and profits back to their country of origin. This in turn stimulates the component of the aggregate demand, stimulating its own economy and creating jobs for its local population. Since 1978, all controls on (currency) exchange have been abolished both for residents and non-residents, also making it easier to remit funds in and out of the country.
- International Financial Center
Through a reputation for integrity, strict enforcement against crime and money laundering, and revolutionary legal and tax policies, Singapore has grown to be the third-largest international finance center in Asia, only beaten by Japan and Hong Kong. Through a liberalization of the domestic banking market and the attraction of foreign attention; both in the form of international banks establishing a presence and serving not only its own economy but also other Pacific/Asian countries, it has established itself as a key player in the financial industry.
Singapore boasts very favorable corporate law. Incorporation of an entity in Singapore is straightforward and as easy as it comes. Minimum share capital is but 1 dollar, and incorporation can be performed as quickly as 2 weeks. The entire process can be completed digitally, relieving you from the stress of arranging and sending notarized documents. The costs of incorporating are relatively cheap, starting from €750,- based on company structure and amount of shareholders.
Singapore has become a vibrant city with high standards of living and a clean and green environment. Through high levels of investment and general economic prosperity, its quality of infrastructure has become among the best in the world. It has fast internet with no access restrictions, an extensive railway network, and direct flight connections to all the major cities in Asia.
- Joint Venture Singapore Company between European and Chinese parties for a project in China
- Fast incorporation of Singapore company. Shareholder agreement under Singapore law. No capital gains tax in Singapore
- Project CFO was comfortable moving to Singapore.
- Investment in an Indonesian Start-up by a group of European investors
- Shareholder agreement under Singapore law, Investors comfortable with Singaporeans from Singapore banks for the investment
- Tax treaty, Indonesia – Singapore.
- Expansion of European company into India and the Philippines
- Asia employee bonus pool managed and distributed in Singapore, No dividend withholding from Singapore company to European HQ
- Asian sales force based in Singapore.
Reach out to one of our advisors today and figure out what your opportunities are in Singapore.