Characteristics of offshore companies in Singapore
The offshore companies opened in Singapore must be formed by at least one shareholder and maximum fifty. The shareholders may be corporate bodies or natural individuals. One resident must own the manager position along with other appointed local or foreign managers. The Managers can only be natural persons, above 18 years old.
A natural person, local resident must be the Secretary of the Singapore offshore company
. It may not be in the same time shareholder of the company or manager. There is no authorized capital
requested at incorporation of an offshore company in Singapore
but a symbolic share capital of at least 1 dollar must be deposited.
Procedure of opening an offshore company in Singapore
The following documents
must be presented for the registration of an offshore company
in the Companies Registrar of Singapore: the passport copies of the shareholders and the managers, their residential addresses, as well as details regarding the parent company.
First, the name of the offshore company must be approved by the Companies Registrar. If it’s available, it will be reserved until all the registration procedures are finished.
Secondly, the company is registered at the Company Registrar of Singapore and will receive a certificate of registration based on the above documents.
Once this step is taken, a bank account must be opened. The next step is registering for the Goods and Service Tax (Value Added Tax) at the Inland Revenue Authorities of Singapore.
Some activities require using a license that can be received from the relevant authorities. After obtaining these licenses and approvals, the company may start its business
Advantages of opening offshore companies in Singapore
There are many reasons why the companies choose to open offshore companies in Singapore.
First of all, the registration procedure is very easy and the process is made online so the bureaucracy is almost inexistent.
Another major reason is the small taxes
and sometimes their absence related to the company’s activities. For example, the capital gains are not taxable
; also there is no tax on dividends
If a company is formed by less than 20 shareholders (from which one is keeping 10% of the shares), in the first three years the company is subject to a 0% tax rate on the first 100000 Singapore dollars taxable incomes. The profits up to 300000 Singapore dollars are taxed with a corporate income tax of 8.5% and a flat 17% for above 300000 Singapore dollars.
The foreign source income, not delivered in Singapore, is exempt
from Singapore fees
. Also the foreign source of income that meet certain conditions, received in Singapore may be exempt from these taxes. Please free to address to our Singapore lawyers
for consultancy in a wide range of legal matters, including taxation.
Despite the small taxes and fees, Singapore is though not considered a tax heaven and that is the reason why an offshore company opened here is taken more seriously than in other locations.
Another reason why opening an offshore company
is appealing is the fact that the foreign ownership of the company is allowed 100% in all the sectors and no authorization is requested at registration from the Singapore’s authorities.