Required compliances for your business based in Singapore
So hopefully our previous information articles and guidelines have been helpful to you for your project and you have now managed to successfully incorporate your own business in Singapore. In that case we congratulate you on taking the first step on the way to becoming a great entrepreneur. This is only the start of your journey, though, and we want to make sure that it is a pleasant one.
Now that your business is up and running there are some important requirements that your company will have to comply to on a regular basis in order to satisfy Singaporean authorities and keep your business serious and credible. In this article we will point out the most important duties you need to be aware of to act in accordance with the law and keep your business out of trouble.
Your registered business address has to available to the public
When registering your company you were asked to provide a credible, physical business address in Singapore or under some circumstances use your private residential address as a home office address for your company. On top of supplying a legitimate business address you are also required to make this office location accessible to the general public at least during regular office hours.
Appoint a company secretary and a local resident director
All companies registered in Singapore must have a nominated local company secretary. In addition to that, the selected person must be qualified and have sufficient experience in functioning as a company secretary. While a company can have multiple directors it is required that at least one of the nominated directors is a resident of Singapore, this can either be a Singaporean citizen or a foreigner holding a Singapore Employment Pass or Singapore Entrepreneur Pass. All individuals above 18 years of age is qualified to act in such role.
You must appoint an auditor unless exempted
After incorporating your business you will be asked to appoint an auditor. You need to nominate a person for this role at the latest 3 months after the date of company registration. Under some circumstances your company can be exempted from appointing an auditor and mandatory annual financial audits. Your business is exempted if at least two out of the following three factors hold true for the previous two financial years: Your total revenue per financial year does not exceed the amount S$10 million, your total assets per financial year do not exceed the value of S$10 million and the number of your employees in this particular financial year does not exceed 50. Simply put, this means that most small businesses are exempted from annual accounting audits.
Determine your companies financial year end (FYE)
Every company in Singapore is required to state a fixed financial year end. Your balances at the end of every financial year are an important factor that will be of interest to potential future investors, current shareholders and the Singaporean authorities to determine your company’s tax rate, options to extend your company and much more. Unless your company is a subsidiary company you are free to choose financial year end date of your business to your liking. As a subsidiary company your financial year end date has to be identical to that of the holding company.
If your company’s yearly turnover exceeds S$ 1 million you will need to register GST
Goods and service tax is a tax rated applied to all goods and services in Singapore and it’s imports. As a GST registered company you will have to pay GST tax on all goods and services sold by your company. The current GST tax rate is a flat 7%. Since only companies with a yearly turnover of more than $S 1 million must be GST registered this will not apply to most of our readers who are planning to establish small, private businesses.
Depending on the nature of your business you might need one or more business licenses
Some business activities require you to obtain the relevant qualification licenses before you are legally allowed to commence business in this field. Listing all business activities and their respectively required licenses would go far beyond the scope of this article. Just be aware of this fact and do some research on whether or not your particular business must obtain any licenses. The process of getting the needed licenses has been made very easy in Singapore and provided you possess the relevant documentations and experience in your field it should not be an issue to have your license granted.
Always include your company’s registration number on all business related documents
All businesses in Singapore are given a so called Unique Entity Number (UEN) as a unique identification number. This number serves as a convenient identification for all interactions with Singaporean authorities, such as filing your company’s annual tax return, submitting CPF contributions and applying for permits or licenses. This identification number should be stated on your businesses publications, announcements, invoices, account statements and all other official documents.
Regular reports and notifications to the Company Registrar and Revenue Authority
All Singapore companies are responsible for filing their annual tax return with the Singaporean Revenue Authority. In addition to that, your company is required to file an annual report with the Company Registrar containing details about your company, it’s officers, registered address(es), auditors (if any) and more. Should there be any changes to your company structure or your company’s officers you will need to notify the Company Registrar immediately. Failure to provide these reports will lead to heavy penalties.