Singapore has gained the reputation of being one of the most startup-friendly cities in the world. It is an easy place to conduct business because of its excellent legal system and strategic position in Asia. However, if you are a tech founder considering incorporating in Singapore, there are a few things you should take into account before you press the submit button on that registration form.
Select the Right Business Structure
Choosing a corporate structure is one of the initial decisions. A Private Limited Company is preferred by most tech startups as it limits personal liability and appears plausible to investors.
Other alternatives are partnerships or sole proprietorships. They are more straightforward but have greater individual risk. Question: How much risk are you prepared to take, and are you intending to find investors? Your response will inform the appropriate structure to form your company in Singapore.
Ensure Your Company Name Works
You want to give your tech company a catchy name that is fun to say. But in Singapore, it needs to comply with the requirements of ACRA. It cannot be the same or too close to an existing company, and some words must be approved.
You should conduct a search on the ACRA portal to check availability before incorporating. This may be boring. However, it will prevent the need to redo them in the future.
Appoint at Least One Local Director
The Singapore law requires that at least one of the directors must be a resident of Singapore. This may be a citizen, permanent resident, or an EntrePass holder.
Do not panic in case you do not have a local co-founder. Professional nominee director services are legitimate and widely used by many startups. All you need is to be aware of the responsibilities and liabilities that accompany it.
Get Your Paperwork Ready
It is easier to form your company in Singapore as long as you have your documents in place. Typical requirements are:
· A company constitution.
· Name and address information on directors and shareholders.
· A registered Singapore address.
One of the most common reasons ACRA delays approval is missing or inconsistent documents. Triple-check to simplify the process and make sure nothing goes wrong.
Consider Your Funding and Share Structure
Think of how you will organize shares and ownership even in the initial phase. Angel investors, venture capitalists, or incubators are some of the common sources of funds for tech startups. Clarity and flexibility of the share structure will make things easier in the future as you introduce new investors.
Another thing to consider is share options among employees. This can help attract the best talent in this competitive tech industry.
Stay Compliant From Day One
Last but not least, Singapore is very strict with the filings, taxes, and corporate secretarial responsibilities. Even a small tech startup has to file annual returns, keep adequate records, and pay taxes on time.
Starting good habits now will help in life later, particularly when your startup takes off. It is more convenient to make compliance a part of your culture than to resolve problems later.
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