So, you’re always brimming with madcap business ideas that you’re convinced will work, plus you’re sick and tired of working for unappreciative bosses. Well, maybe the next is to step up your own business!
Setting up a company is ridiculously fast and easy in Singapore, and best of you all, everything can be done online. Here’s how to do so in a few easy steps.
Get your company name approved
Before you can apply to register a business, you’ll have to first make sure that your desired company name is available and reserve it. You do so by applying for a new business name on ACRA’s Bizfile website.
Simply log into Bizfile, click on Explorer eServices > Business > Application for a New Business Name. Then fill in the online form and click submit. You will be prompted to make an online payment of $15 for the application. ACRA will then inform you via email if your business name has been approved.
To make sure you don’t waste your $15, there are some guidelines for company names in Singapore that are worth knowing, as transgressing these rules will get your business name rejected. Names that are undesirable, such as those containing obscenities, might be rejected, as might names that are identical to another business’s or someone else’s reserved name. There are also a few names that are prohibited, such as the word Temasek.
Once approved, the business name will be reserved for you for up to 120 days. In those 4 months, you are free to incorporate a company with that name. If you do not, you will simply lose your reservation.
Register your selected business entity
Once you’ve got your name approved, your next step is to register your business entity on ACRA Bizfile. This could mean incorporating a company, setting up a partnership or simply registering your business as a sole-proprietorship.
Here are the broad differences between the three.
- Company: This is the most visible type of business and means that the company exists as a legal entity separate from its owners. This means the company’s debts and liabilities are its own rather than those of its owners. If a business’s official name ends in “Private Limited”, that means it is a company.
- Sole Proprietor: Refers to self-employed people running a one-man show such as private tutors. As a Sole Proprietorship is not a separate legal entity from its owner, it also means you are liable for any debts and liabilities incurred by your business.
- Partnership: Similar to a Sole Proprietorship in that the owners are personally liable for the debts and liabilities incurred by the business, just that there is more than one owner. There are also entitles called Limited Partnerships and Limited Liability Partnerships, in which the owners’ liability is limited to the assets and investments of the business.
Registration of a business is done online on Bizfile and is a relatively straightforward process. You must pay the following registration fees:
- Company: $300
- Sole Proprietor: $100
- Partnership: $100
Set up your company
When registering your business, you will need to appoint the following officers:
- At least one shareholder (this can be a person or a corporate entity)
- At least one director resident in Singapore
- One company secretary
People can hold multiple roles. So, you can act as both the shareholder, resident director and/or secretary.
You will also need to specify the following:
- Singapore registered office address – You may use your residential address if you don’t have an office.
- Initial paid up share capital – This has to be at least $1.
Open a business bank account
At some point you might wish to open a business bank account for accounting purposes.
Doing so is as easy as going to a bank branch and asking to open a corporate account. But you should make sure you inquire beforehand about the documents you need to furnish, which might include your Certificate of Incorporation, your business profile printout, and the signed consent form to act as a director or secretary, which can be found on ACRA’s website.
Of course, you will want to compare what the various banks are offering. If you are starting a very small business, opt for a bank that does not charge set-up fees and little to no monthly account fees. Another thing to look out for is free cheque books if you need one.
If you will be engaging in overseas bank transactions, you might also want to opt for a foreign currency account.
Further steps to setting up your business
Depending on what your business actually does, you either hit the ground running, or do one or more of the following things:
Apply for licences and permits
Certain types of business activities require certain licences and permits before they can be legally undertaken. This includes but is not limited to the following types of business:
- Recruitment or employment agencies
- Tour agencies
- Massage establishments
- F&B businesses
- Handphone shops
- Private education institutes
- Business that import goods from abroad
- Businesses organising arts entertainment events, public entertainment events or trade fairs
Don’t try to operate your business on the sly without the necessary licences. If caught, you might not only be subject to fines, but might also be barred from running your business altogether.
Register for GST
If your annual taxable turnover exceeds $1 million per year, you will need to apply for GST registration of your business. Failing to do register within 30 days from the time you become a GST-liable entity can make you liable to fines.
You can apply for GST registration through IRAS’s myTaxPortal website using your business’s CorpPass.
Register with CPF to contribute employer’s CPF
Before hiring your first employee, you will need to register your business as an employer with the CPF Board. You can do this by logging in with your CorpPass to the CPF Board’s website here.
Once approved, you will receive a CPF Submission Number (CSN) and a Direct Debit Authorisation form. You will need your (CSN) in order to make deposits into your employees’ CPF accounts.
While these steps might sound complicated, the process is really very simple. Rest assured that you will definitely find actually running your business more challenging than setting it up!
Have you ever set up your own business? Share your experiences in the comments!