Frequently Asked Questions

Yes, companies must appoint a company secretary within 6 months from the date of incorporation. This position cannot be left vacant for more than 6 months or the directors may face a penalty of up to $1,000.

Yes, you can hold the positions of director and company secretary at the same time as long as you are qualified. However, if you are a sole director of a company, you cannot be appointed as a company secretary.

A Company Secretary must be an individual, locally resident of Singapore and not debarred from acting as secretary of a company.

Goods and Services Tax (GST) is a tax levied on the import of goods and nearly all supplies of goods and services in Singapore. It is known as Value Added Tax (VAT) in other countries. The current GST rate for purchases of goods and services to GST-registered businesses is 8%

As a business, you must register for GST when your taxable turnover exceeds $1 million. If your business taxable turnover does not exceed $1 million, you may still choose to voluntarily register for GST after careful consideration.

You must satisfy any of the following to qualify for voluntary registration:

• Your business makes taxable supplies;
• Your business only makes out-of-scope supplies. Out-of-scope supplies mainly refer to sales of goods that did not enter Singapore and goods in transit; 
• Your business makes exempt supplies of financial services that are also international services; or
• Your business procures services from overseas service providers or imports low-value goods and you would not be entitled to full input tax credit even if you were GST-registered.
   

GST is charged on all sales of goods and services made in Singapore, except for exported goods, international services and exempt supplies.

Exempt supply pertains to those goods and services where GST is not applicable. GST exemptions apply to the goods provision of most financial services, the supply of digital payment tokens, the sale and lease of residential properties, and the importation and local supply of investment precious metals.

Out-of-scope Supplies are supplies that fall outside the scope of the GST Act. GST does not need to be charged on out-of-scope supplies and such supplies need not be reported in the GST return.

Out-of-scope supplies include the sale of goods not brought into Singapore, sales of overseas goods made within the Free Trade Zone and Zero GST Warehouses, and private transactions.
 

All GST returns must be submitted via mytax.iras.gov.sg within one month from the end of each accounting period.

You are liable on conviction to a fine not exceeding $10,000, a penalty equal to 10% of the tax due in respect of each year or part thereof commencing from the date on which you are required to make the notification or to apply for registration; and a further penalty of $50 for every day during which the offense continues after conviction.

You should start charging GST only from the effective date of your GST registration. If your application for GST registration is successful, you will receive an approval letter informing you of this date, together with your GST Registration Number.

As defined by the Act, “A director is a nominee if the director is accustomed or under an obligation whether formal or informal to act in accordance with the directions, instructions or wishes of any other person. The obligation to act in accordance with the directions, instructions or wishes of any other person may arise from legal obligations (e.g. contract; trust) or informal arrangements.”

To protect the interests of the nominee director, a security deposit is required as there are cases where foreign clients become uncontactable. The security deposit will be used for closure/liquidation charges of the Company if foreign clients become uncontactable.

A director, nominee or not, has the same duties and power over a Company. The business of a company is managed by, or under the direction or supervision of, the directors. They may exercise all the powers of a company except any power that the Companies Act or the Constitution of the company requires the company to exercise in a general meeting. Appointing a nominee director is like giving power to someone, who you may not even know, the control and direct your Company.

This may vary depending on the requirements of the desired bank. It is always useful to check first the bank’s website for the requirements and paperwork to save time in opening a bank account.

Below are the basic documents required to open a bank account. This list does not apply to all banks since different banks have their own set of standards and required documents.
 

• Director’s resolution to open a bank account
• Copy of Company’s certificate of incorporation
• Copy of the Company’s ACRA business profile
• Copy of M&AA or Constitution
• NRIC of all Singapore resident directors and all authorized signatories
• Passport copy of all foreign directors and authorized signatories (if any)
• Proof of residential address of all directors and authorized signatories
• Other information (subject to the requirements of the desired bank) 
   

Yes, you may open a business account as a foreigner. The bank may require additional documents and information to comply with the AML policies.

An owner, tenant, or authorized occupant of a housing unit who plans to conduct a small-scale business from their home may use their residential address as the office address under the Home Office Scheme managed by the Housing Development Board (for HDB flats) and Urban Redevelopment Authority (for private residential properties).

Yes, under the Home Office Scheme, owners, tenants or authorized occupants of HDBs and/or private residential properties can conduct small–scale businesses in their homes, as long as they satisfy the prevailing Home Office guidelines and performance criteria and ensure that the activities do not cause disamenities to the neighbors. Prior approval under the Home Office Scheme must be obtained before submitting your application to incorporate your company.

However, it must be noted that the home address will become publicly available which means possible loss of privacy
 

For startups or online businesses who do not intend to set up an actual office, the best solution is the Virtual Office Address services. You may approach a corporate service provider to avail of these services.

Corppass enables businesses and other entities to transact with Government agencies and participating private sector services digitally in a secure manner.

Foreign registered entities and individuals without Singpass may also transact with selected government agencies in Singapore. Foreign ID users can register for a Singpass Foreign user Account (SFA) through the relevant agency of the digital service that they wish to transact with.

The employer or authorised third party who submitted the application can make appeals. The appeal must be submitted to EP Online within 3 months of rejection. But you should do so only if you can address the reasons for rejection.

Typically online applications are processed by MOM within 3 weeks or may take longer if additional information or documents will be required by MOM.

There is no quota or foreign worker levy required for EP. MOM will take into consideration the applicant’s qualifications and the company’s merits.

No. S Pass holder changes jobs and the new pass is approved, MOM does not automatically cancel the existing work pass. This is so that the current employer has a notice period and the employer and pass holder settles all employment issues. The employer needs to cancel the pass using EP Online.

Yes. Late or non-payment of the foreign levy is subject to the following penalties:

• The company will be charged a late payment penalty of 2% per month or $20, whichever is higher. Your total late payment penalty will be capped at 30% of the outstanding levy.
• The existing S Pass will be canceled.
• The Company won’t be allowed to apply for or issue S Pass, or renew an existing S Pass.
• You may face legal action to recover the unpaid levy.
• If you, your partners or directors head other companies, these companies may not be allowed to apply for S Pass.
   

The following electronic methods may be used for paying S Pass salaries:

• General Interbank Recurring Order (GIRO) with your designated bank.
• Internet funds transfer.
• ATM funds transfer.
• Standing order.
• Funds transfer through bank counters.
   

Yes. The employer has 3 months to appeal an unsuccessful S Pass application but should do so only if the reasons for rejection can be addressed.

The Company’s Central Provident Fund (CPF) account is used to count local employees and calculate the S Pass quota.

We have 3 virtual office plans and each plan has a different subscription period. Please see here for more information.

A virtual office allows your company to have a registered office address without setting up an actual office.

CPF helps Singapore Citizens and Permanent Residents save funds for their retirement. Savings accumulate in the three accounts; Ordinary account, MediSave account and Special account as they work and contribute to CPF. At the age of 55, a Retirement account will be created for them.

Yes, the director must ensure that the CPF contributions of the employees are correct.

A CPF calculator available on the CPF website can be used to check whether your CPF contributions are correct. You will need your payslip to input the wages in the CPF calculator.

Yes, the Employment Act requires the employer to provide its employees with an itemized payslip.

Local companies who are keen to adopt IT solutions (particularly accounting software solutions) can receive Productivity Solutions Grant (PSG) support from the Singapore government. The maximum level of support will be up to 70%. SMEs can apply for PSG if they meet the qualifying conditions.

To apply for PSG you must meet the following criteria:

The business entity is registered/incorporated in Singapore

• The company does not fall under the following categories:
• Charities 
• Institutions of Public Characters (IPCs) 
• Religious Entities 
• Voluntary Welfare Organisation (VWO)
• Government agencies 
• Subsidiaries

At least 30% of the local shareholding is held directly or indirectly by Singaporean(s) / Singapore PR(s), determined by the ultimate individual ownership of the applicant.
Purchase/lease/subscription of the IT solutions or equipment must be used in Singapore
 

No, there is no yearly subscription fee. The one-time payment will offer you a license for life.

No. Xero is on the cloud and needs an active internet connection and a supported browser to use it.

Yes, Xero supports up to 160 currencies.

All income earned in or derived from Singapore is taxable. The overseas income received in Singapore generally is not taxable except in some circumstances.

Foreign-owned investment holding companies, with purely passive sources of income or receiving only foreign-sourced income, are generally not considered tax residents of Singapore because these companies usually act on the instructions of their foreign companies/ shareholders.
 
However, they may still be treated as Singapore tax residents if they can satisfy certain conditions.
 

A company must retain its accounting records and supporting documents for 5 years from the relevant YA. Failure to do so may result in expenses claimed being disallowed and/or penalties.

A dormant company must file its Corporate Income Tax Return (Form C-S/ Form C-S (Lite)/ Form C) by 30 Nov every year unless the company has been granted a waiver to file Form C-S/ Form C-S (Lite)/ Form C.

A sole-proprietorship or partnership business is not considered a company.

File corporate income tax via mytax.iras.gov.sg. You have to first be authorized by your company to act for its Corporate Income Tax matters via Corppass.

File personal income tax via mytax.iras.gov.sg using your SingPass. SingPass 2FA must be activated before you can log in to the portal.

You may use the Tax Clearance Calculator to find out whether tax clearance is required for your employee. The type of pass your employee holds (including long-term visit pass and dependant's pass) does not affect the tax clearance requirement.

A board director may also take on an executive role (for example, Chief Executive Officer, Chairman and Managing Director) and is involved in the daily running of the business operations. The remuneration derived by a non-resident director in his capacity as an executive director is not subject to withholding tax.

This is a payout to support individuals who have lost their jobs as a result of the COVID-19 pandemic, while they find a new job or attend training and is not taxable.

Businesses that choose to accept digital tokens such as Bitcoins for their remuneration or revenue or that trade in digital tokens are subject to normal income tax rules.

An offshore company is a company registered in a foreign jurisdiction. They are permitted to trade, hold assets and conduct normal business activities legally outside of the jurisdiction where it is incorporated.

To name a few, an offshore company can enjoy confidentiality, tax reductions, protection of assets, simple corporate regulations, and financial privacy.

These are the basic documents required. Additional documents may be requested for due diligence purposes.

Individual

• Certified passport copy
• Certified Proof of residential address not older than 3 months

Corporate

• Certified Constitutional documents with Registered Office Address i.e. Memorandum and Articles of Associations, Constitution, Trust Deed, or equivalent.
• Certified Certificate of Incorporation
• Certified Register of Directors and register of Shareholders or a current dated
• Certificate of Incumbency reflecting this information.
• Certified Corporate Structure