Foreign Companies Benefit More In Singapore Subsidiary Office

By Author: zbenriquez
Total Articles: 10
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With Singapore's world-class infrastructure, pragmatic and good governance, attractive corporate and immigration laws, and strategic location, this country has been considered as one of the best business centers in the Asia Pacific by the international community.

Currently, there are three business structures a foreign company or businessman can adopt: a representative office, branch office, and subsidiary company.

When it comes to greater freedom to conduct commercial activities, most experts agree that a subsidiary company is the most ideal business structure for foreign companies planning to engage in a full operation.

With this business setup, foreign companies and businessmen can enjoy these following benefits:

1. Greater business freedom

The Singapore government allows a subsidiary company to engage in any commercial activities even if these are not related to the main business of its foreign parent company. With this greater business freedom, this business structure can maximize its profit-generating activities.

2. Limited liability protection

Limited liability protection ...
... is the most notable benefit of having a subsidiary company. According to experts, this means that a parent foreign company cannot be held liable for the acts, losses, and debts of its Singapore subsidiary company.

3. Considered as tax resident

Because a subsidiary company is incorporated in Singapore, it is considered as a tax resident which means that it can enjoy the local tax incentives and exemptions as long as it will meet these qualifying conditions:

● Its control and management is locally exercised.

● At least one individual shareholder has a minimum of 10 percent shareholdings; or

● It has no more than 20 individual shareholders with all of them holding their ownership under their names.

4. Foreign company is allowed to be the sole owner of its subsidiary company

Even if 100 percent owned by its foreign parent company, this business structure is still eligible for the local tax incentives and exemptions.

5. Better management structure

Under the Singapore Companies Act, a subsidiary company should practice its control and management locally which means that its board of directors can enjoy greater control. (It is important to note that even international companies should operate locally in order to become successful.)

6. It can have up to 50 shareholders who may be foreigners and local residents

A subsidiary company may have one to 50 shareholders who may be a local resident or foreign businessman. Meanwhile, it is also allowed to be solely owned by its foreign parent company.

Note: Since foreign companies and businessmen are not allowed to register their own business, it is a legal requirement to hire a professional firm that will process their Singapore subsidiary registration.

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Rikvin is the leading company registration firm and has successfully helped hundreds of both foreign and local entrepreneurs form a Singapore Sole Proprietor. The firm provides a complete corporate solution under one roof which includes assistance in Singapore Subsidiary Registration, with the opening of corporate accounts, business registration including accounting, tax, immigration related to work passes visa and compliance services.