Singapore Offshore Company
The titles, Singapore Exempt Company, Singapore Offshore Company and Singapore Non- Resident Company are akin to each other and pertain to a company incorporated under the Singapore Companies Act of 1994 that can be used for business outside of its country of registrations. For the sake of clarification, the Singapore offshore company is one used outside the country of incorporation and subject to a low or no tax regime.
Conveniently, all Singapore companies are all capable of operating offshore, so there are no limitations therein, and ,during incorporation of a Singapore company, there is no limitation as to the type of corporate structure for the desired off shore corporation. Singapore has several forms of legal entities including Singapore companies limited by guarantee (Ltd.), foreign company branches, foreign companies and private limited companies (Pte Ltd.).
Singapore offshore companies will attain the status non-resident or resident based on the location of management and control. If the company is controlled and managed outside of Singapore it is a non-resident company. If control of the company is from within in Singapore, it is a resident company. However, unlike regular offshore jurisdictions where the term ‘non-resident company’ is a name reference for an offshore company that is governed by its own rules and a separate regime from domestic companies, in Singapore a company may be non-resident, but still able to operate and earn income in Singapore and consequently be subject to taxation.
Similarly, a resident Singapore company may be exempt from taxation if income is earned strictly outside Singapore. In sum, the residency status of Singapore companies does not notably affect its tax liability, since companies are taxed based on origin of income. Singapore offshore companies pay no local taxes on income generated outside of Singapore. Domestic income is taxed at a rate of 17% that can be further reduced to3% where tax credits are granted. There is no capital gains tax, estate tax or withholding tax on foreign income.
Whatever legal structure an investor chooses would be a matter of partiality and suitability given the circumstances and objectives. Singapore scores very highly for easy firm production, comparable to Belize companies formation, procedures and a friendly business environment.
Exempt or Singapore offshore companies are not obligated to submit to the authorities their annual audits. For the Incorporation of a Singapore offshore company just one shareholder and one director is needed according to Companies legislation. The shareholder of the Singapore offshore company can be a foreigner or a local. The shareholders of Singapore offshore companies can be individuals or corporation. The appointment of a company secretary by a Singapore offshore company is obligatory according to the stipulation of Singapore Companies Act. The company secretary in Singapore must be an individual.
Singapore nonresident companies are required to have one Singapore resident director and two non-Singaporean directors. Nonresident companies may not keep meetings in Singapore.
Consequently, for use as a Singapore offshore company, a private limited company would be usually incorporated because of the ease of raising capital, limited liability, credibility as a corporate structure, tax benefits and incentives available in Singapore for the remission of funds or setup of a Singapore based production site, simple ownership transfer provisions and perpetuity. Alternative Singapore companies or corporate forms, which can be used as offshore companies, include foreign companies, branches and subsidiaries.
Singapore offshore companies do not only acquire the image of an international business company with less chance of being perceived as an ‘offshore company’ but can benefit from trade agreements that Singapore has with other countries. As a contemporary business hub, Singapore ranks at the top internationally for the most competitive and freest economy, best investment potential and cost-competitive place for business and represents a choice jurisdiction for offshore company formation.