Foreigncompanies wanting to settle in Singaporecanregister branch offices. Compared to theSingapore subsidiary, thebranch officeis part of the foreign company that registered it and does not have its own legal personality. The advantage of being part of the parent company is that the foreign entity is fully liable for thebranch office’s undertakingsin Singapore.Singapore branch officeswill not be subject to any tax exemptions unless they have aregistered officeor a management board in the country.
Our local consultants have the necessary experience to guide those who want toopen a company in Singapore, including foreign companies interested inopening a branch office in Singapore.
| Quick Facts | |
|---|---|
| Applicable legislation | Foreign legislation for the parent company, Singapore legislation for the local branch |
Best used for | Specific activities which require strict regulations (financial/insurance activities) |
Minimum share capital | No |
| Time frame for the incorporation (approx.) | Approx. 8 weeks |
| Management (Local/Foreign) | The branch must have at least one local resident director |
| Legal representative required | Yes |
| Local bank account | Yes |
| Independence from the parent company | Totally dependent on the parent company |
| Liability of the parent company | The parent company incurs full liability for the branch office's debts and obligations |
| Corporate tax rate | 17% on the profits arised in Singapore |
| Possibility of hiring local staff | Yes |
| Documents to be filed by the parent company | The following papers must be filed: – information about the parent company; -details of the Singapore officers appointed; – proof of legal address, etc. |
Annual accounts filing requirements | Singapore branch offices must file annual accounts of the parent company with ACRA |
Travel requirements for incorporating a branch (YES/NO) | No, there is no need to travel to Singapore to incorporate a branch office |
| Double tax treaty access (YES/NO) | YES, branch offices have access to double tax treaties provided the parent company is registered in a country that has such an agreement with Singapore |
| Special licenses required (YES/NO) | YES, branch offices may require special permits based on the industry they will operate in |
| Singapore legal address required (YES/NO) | YES, such an entity must have a local legal address |
| Activities permitted | There are no restrictions with respect to the activities to be completed, however, branches usually operate in well-regulated sectors, such as the financial one |
| Best used for | Financial and banking operations |
| Employee transfer possibility (YES/NO) | YES, it is possible to transfer employees from the parent company to the Singapore branch |
| Advantages of a Singapore branch office | – Easy and quick registration; – low corporate tax; – access to multiple double treaties; – can benefit from tax incentives. |
| Incorporation services availability (YES/NO) | YES, we can help investors open branches and set up new companies in Singapore |
Requirements for opening a branch office in Singapore
As mentioned above, thebranchis mainly an extension of a foreign companyin Singaporewhich is why it must carry the same name as the parent company. According to theCompany Law in Singapore, abranch officerequires two resident agents who must deal with theregistration processand other activities on behalf of it.Branch officesare also required to have a registered officein Singapore. TheSingapore branch officemay carry any undertaking as the parent company does and has the right to repatriate the earnings and the capital. ASingapore branchwill only be taxed on the income made in the country.
The primary procedures inestablishing a branch in Singaporeinclude selecting a business form and name, selecting important executives, and drafting the incorporation documents. Because there is a certain sequence in which these processes must be carried out, you can contact our experts for assistance. In case you are interested insetting up a branchin another jurisdiction, for example in a European country, such asRomania,you can get in touch with our partners who can help you in this matter and in otherlegal areastoo –Rolegal.com.
The registration of a branch office in Singapore in 2024
A foreign company is required to hire a professional firm whenincorporating a companywhich is why ourspecialists in company formation in Singaporecan provide you with full services forcompany registration.
The first step whenopening a branch office in Singaporeis to submit the company’s name for approval with the Trade Register. The name will be approved unless it is identical with another’s company name. The second step will be the submission of the registration file with the Trade Register. The process should not take longer than 2 days. Once the registration is completed the Companies Registrar will send an email notification with the confirmation of the newSingapore branch office. The notification will usually serve foropening the bank account in Singaporeor the registration fortaxation purposes, but an incorporation certificate can be issued at the company’s request.
Branches can also opt forEORI registration in Singaporein order to trade on behalf of the parent company. If you are interested inopening up a company in Singapore, our team of experts is at your disposal.
Every Singaporean company must choose a specific code to identify their planned business activity at the time of incorporation. Some codes require the need for particular licenses. If you are confused about which code to choose for your business, contact us. We are also at your disposal with support insetting any type of company in Singapore.
The time frame for incorporating a branch in Singapore is around 8 weeks, while in other countries, such as Macedonia, it may take 3 months.
Documents required for opening a branch office in Singapore
The following documents must be submitted for theregistration of a branch office in Singapore:
- notarized copies of the Certificate of Incorporation of the foreign company,
- notarized copies after the Articles of Association of the parent company,
- details about the parent company’s directors,
- a resolution appointing the two agents acting on behalf of thebranch office in Singapore,
- documents proving the registered address of thebranch,
- a statement issued by the foreign company regarding the powers of the two local agents.
Opening a bank account for a branch in Singapore
One of the most important steps whencreating a branch in Singaporeis theopening of a bank account. This must be opened with a local bank, be it a Singapore or an international bank. The procedure must be completed by one of the registered agents or one of the directors of the company.
The documents needed toopen a corporate bank accountfor the Singapore branchare the same as for any local company and will imply the branch office’s Certificate of Registration and information about the parent company. It should be noted that the creation of a bank account for a company, no matter if it is a local business or a branch office, depends on the bank chosen. For example, some banks require the presence of one of the directors, while others do not. Either way, a representative of the company will need to meet with the bank officers to sign the paperwork related to the opening of the bank account.
When opening a bank account for abranch office in Singapore, in2024, our specialists can help you.
OurSingapore company formation specialistscan help foreign investorsset up branch officesthrough the entire procedure of creating the bank account, including initial bank recommendation.
Special licenses and permits for branch offices in Singapore
Thebranch officewill be limited to completing the same activities as the parent company which means it will have toobtain the licenses and permitsfor those activities only. These licenses, however, must be obtained with the relevant Singapore authorities which could imply requesting legal assistance.
The documents required to apply for the necessary licenses in order tooperate a branch in Singaporeare the same as for any other local business.
If you are interested inopening a company in Singaporeand need guidance in applying for any specific license, our consultants are at your disposal with personalized services.
You can also see below a scheme presenting thesteps for opening a Singapore branch office:
Taxation of branch offices in Singapore
From ataxationpoint of view, thebranch officewill be considered a non-resident business entity. This means that it will be levied thecorporate tax only on the income generated in Singapore. The disadvantage of this business form is that it cannot take advantage of the incentives granted by the government to Singapore companies, however, it can benefit from the provisions ofSingapore’s double taxation agreementswhich imply the avoidance of imposing the sametaxeson the income ofbranch officesin this country and in the parent company’s country of origin.
In order to be taxed in Singapore, the parent company will be required to file its annual accounts together with the audited accounts of the branch office with ACRA. These must be filed no later than 2 months after the parent company has held its Annual General Meeting. TheSingapore branch officewill also be required to file its tax returns with the Inland Revenue Authority in the city-state.
We remind foreign investors thatSingaporeimposes thecorporate taxat a rate of 17%, one of the lowest corporate taxes in Southeast Asia.
Those who need accounting services related to their companies in Singapore can rely on our team of accountants who offer personalized assistance.
When it comes to theemployees of a branch registered in Singapore, this type of entity will be allowed to hire local workers or bring employees from the parent company’s home country. For foreign workers, the branch office will need to obtain work permits on their behalf. Our team can definitely help youopen a branch in Singapore in 2024and hire employees. We can also advise on employment matters, specifically related to hiring foreign workers who need work and residence permits.
What are the annual filings Singapore companies must submit with the IRAS?
Depending on the type of company, thedirectorsare required to prepare several documents which must be filed with the IRAS within a pre-established period of time. These documents are:
- an Estimated Chargeable Income (ECI) form that must be filed within 3 months before the end of the financial year;
- audited financial accounts;
- annual returns which must be filed within a month from the Annual General Meeting.
There are certaintypes of Singapore companiesthat are not required to have theirfinancial accountsaudited. Also, the first Annual General Meeting for newly incorporated companies must be held within the first 18 months of the registration. Allannual filings submitted with the IRASmust be signed by the company’s directors and secretary.
If you want toopen a company in Singaporeand need information about filing the annual accounting documents, you can refer to our local specialists.
What documents must be submitted when filing for ARs in Singapore?
ASingapore company filingfor itsannual returnswith theIRASmust provide the following information:
- the company’s name and registration number;
- the registered address;
- the object of activities;
- the company type;
- details about the share capital and the type of shares issued;
- the registered charges;
- information about the company’s directors and shareholders;
- the date of the annual returns, the Annual General Meeting and accounts;
- the financial statements, if applicable.
Financial statementsare required only if the company has a corporate shareholder or if it is in insolvency. We are at your service if you are interested inwinding up a company in Singapore.
Compliance requirements for branch offices – presented by our experts in opening companies in Singapore
Branch offices in Singaporewill be subject to the same compliance requirements as all other companies, meaning the information about the address and the name are available to the public. Moreover, this type of business form must have the address and the name engraved in each place it has an office (provided it has more than one) and on all official documents used in its commercial activities. Also, any changes brought to the management or structure of the branch must be reported to theAccounting and Corporate Regulatory Authority(ACRA).
From an accounting point of view, thebranch officeis a Singapore resident only if it is managed from an office located in the city-state. In order to not pay the same tax twice, a branch office will fall under the incidence of Singapore’s double taxation agreements. Considering the parent company, even if located in a foreign country, will hold an annual general meeting, it must send its financial statements and accounts to theSingapore branch. These documents must be filed with ACRA no later than two months after the annual meeting of the shareholders or in maximum seven months after the end of its financial year. Thebranchmust also file annual tax returns.
The financial requirements to meet whenopening a branch in Singapore in 2024are the same for foreign entities seeking to expand their operations. Depending on the activities to be completed, it is very important to respect licensing requirements imposed at industry-level.
Why open a branch office in Singapore in 2024?
In 2024, thebranchis still a good choice for foreign companies who seek to have an established presence in the city-state withoutregistering a new local company. Thebranch officeis also a more suitable option than therepresentative officewhich cannot undertake any type of commercial activity. Combined with the fact that the parent company does not have to prepare any separate incorporation documents or obtain approval for a new trade name simplifies a lot thecompany formation process.
We also invite you to watch our video onhow to open a branch in Singapore:
What to consider when opening a branch in Singapore in 2024
Opening a branch office in Singapore in 2024has not changed. The timeframe for the establishment of this business form is, however, of a few weeks until the licenses and permits are issued. It is possible for some state institutions to have eased the licensing procedures forbranches in 2024.
If you have any questions about the procedure ofcreating a branch in Singaporein2024, we invite you to contact us.
Economic forecast for Singapore
The economy is expected to increase by 1% to 3% in 2024, according to the Prime Minister. However, he noted that much will depend on the external environment. He predicts growth in 2024 to be 2.2%, which is between the 1% to 3% range the Ministry for Trade and Industry first projected.
The manufacturing and export sectors are on a good path, which is encouraging for 2024. The demand for electronics is rising globally due to a cycle of replacement with new models and improvements, significant US subsidies for semiconductors and electric cars, and a rise in artificial intelligence.
FAQ on branches in Singapore?
If you plan on extending your company in Singapore, both options are viable, as long as you decide on what types of activities you want to undertake. We remind you that the control over thebranch officewill be complete, while in the case of the subsidiary a certain degree of independence will be attributed.
No, there is no need for a personal visit toSingaporeif you decide toset up a branch officehere.
There are specific services for those in need oflocal directorsfor theirbranch offices in Singapore.
Theregistration procedure of a branch officeis not long or complicated and can take a few days.
We offerprofessional company registration servicesand if you need help with the incorporation of any type of business, including aSingapore branch office, you can rely on us.
Please feel free tocontactourcompany incorporation agentswho can provide you with more details about the process ofopening a company in Singapore. Also, contact our partnerlaw firm in Singaporefor litigation and other legal inquiries.
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