Important Compliance Requirements for Newly Incorporated Singapore CompaniesHan
Singapore is one of the easiest countries in the world to start and operate a business. Its pro-business socio-economic policies and favourable tax system offer great incentive and support to business owners, both local and international.
However, Singapore, as a key regional business hub, is also committed to maintaining its orderly and transparent legal system. Companies incorporated in Singapore are therefore required to comply with statutory obligations stipulated by the Companies Act. Adherence to basic annual regulatory compliance requirements will ensure that your Singapore business operations run and expand smoothly, with minimal interruptions dealing with legal matters.
Each registered company in the Singapore has to make sure that all regulatory filings are submitted on time. It is recommended to hire a company secretary or appoint one of the accredited corporate service providers as a nominee company secretary to ensure that you do not miss any of the filings.
The corporate service providers will ensure that your company files annual returns on time and communicates with the Accounting and Corporate Regulatory Authority about any changes in shareholders or directors.
Managing Books of Accounts
Just like in other parts countries, all companies in Singapore are required to prepare and file their financial statements at the end of every financial year. For this to happen, you need to have a bookkeeping system to record every business transaction.
Bookkeeping also entails keeping all relevant supporting documents such as invoices, payroll, receipts, and investment documents as they are instrumental in the preparation and filing of financial statements. They are also used as indicators of cash flow and the business overall financial health especially when applying for loans from financial institutions. Consider hiring a qualified bookkeeping secretary Singapore to manage and monitor your bookkeeping system.
Be Prompt With Your Taxes
One of the main reasons why foreign entrepreneurs and investors prefer company incorporation is the favorable Singapore taxation system. For example, new businesses that get revenue of less than S$100,000 are not required to pay corporate tax for the first three years. Companies whose accrued annual income ranges between S$100,001 – S$300,000 have an obligation to pay 8.5% tax while those that earn more than S$300,000 are taxed at a rate of 17%.
More importantly, after clearing the corporate tax, the company can divide dividends to its shareholders. These dividends are not taxed as they are categorized as capital gain. Singapore government is also keen on reducing the financial burden on local and foreign businesses by giving them tax rebates. For example, the corporate income tax deduction for 2016-2017 is 50%, and the maximum rebate is S$20,000 per year of assessment.