A foreign company that wants to establish its presence in Singapore can do so by setting up a subsidiary office. It is one of the most common and easy ways of company incorpoRation in the country. There are various advantages of setting up a subsidiary office in Singapore, including simple incorpoRation regulations, limited liability, and tax benefits. But before you set up your subsidiary office in Singapore, there are a few things that you need to know. Let us take a look at them:
Among the main requirements that you need to fulfil are the following:
- There must be one company secretary who is a resident of Singapore
- The subsidiary must have at least one shareholder (either a corpoRate entity or an individual)
- The subsidiary should have an office registered in its name
- The subsidiary has to open a corpoRate bank account
You will also have to submit certain necessary documents for opening a subsidiary in Singapore.
A subsidiary office in Singapore has a legal identity of its own. Though the foreign company may be holding 100% of its shares, still it is regarded as a distinct legal entity. In other words, the foreign company will not be responsible for the liabilities, setbacks, or losses suffered by the subsidiary office in Singapore. This structure ensures that the assets of the parent company and that of the subsidiary office can be saved in case either of them is sued.
What type of activities can be conducted by the subsidiary office?
There is no restriction on the type of activity that can be conducted by a subsidiary office in Singapore. The only thing is that those activities must be clearly defined when you incorpoRate the company. As the subsidiary has a legal identity of its own, it is not bound to conduct activities that are similar to that of the foreign company.
You need to file annual returns for your subsidiary office with the Accounting and CorpoRate Regulatory Authority (ACRA) in Singapore. To do this, you have to prepare your financial statements as per the regulations and submit them within the time period allotted for the purpose. If you are not sure how to go about doing this, you can take the help of a corpoRate service provider like https://www.e-sandhurst.com/singapore-subsidiary-office/ to help you with the formalities and regulations.
A subsidiary functions as an independent business entity in Singapore. As such, it is entitled to enjoy the benefits of various government schemes, exemptions, and subsidies that are meant for the resident companies of Singapore. All these aspects make a subsidiary office in Singapore a very tax efficient entity.