Registration Requirements for Singapore Branch Office
The following guide provides you information about the special characteristics of a Singapore Branch Office. Learn about the requirements of setting up a branch office, the involved taxes and the rules and regulations associated with compliance.
A Singapore Branch Office is an extension of a parent company that is registered in a foreign country. A Singapore branch office is established for the facilitation of operations and generating revenue in Singapore for the parent foreign company. Because it falls under the category of Non-Resident with respect to tax considerations, it doesn’t enjoy tax exemptions and incentives which are offered to Singapore Private Limited entities.
REQUISITES FOR SETTING UP SINGAPORE BRANCH OFFICE
- Requires One Corporate Shareholder and Two Singapore Resident Agents
- Singapore Registered Office Address
Under the Singapore Companies Act, a foreign company cannot self-register their Singapore Branch Office. Richmond can help you in registering your Branch Office with the Accounting and Corporate Regulatory Authority of Singapore (ACRA). We are one of the top experts in registering Singapore companies with the ACRA. If you have all the requisite documents, we can help establish your Branch Office within 1 day.
THINGS TO KNOW BEFORE REGISTERING YOUR BRANCH OFFICE
Name – The name of the Singapore Branch Office should be the same as that of the foreign parent company. The name must be approved by the ACRA before we can apply for the registration of the Branch Office. The conditions where the proposed name can be rejected by the ACRA include:
- Identical name to an already existing company name.
- The name is objectionable.
- The name or trademark has a likeness to well-established names or brands like Temasek or Coca-Cola.
Shareholders – The foreign parent company needs to have 100 percent ownership of the Singapore Branch Office.
Resident Agents – The Branch Office should have at least 2 “ordinary” Singapore resident, who could be permanent residents or citizens of Singapore; or holding Dependant’s Pass or Employment Pass. Richmond can provide you assistance in applying for Employment Pass (EP) for your 2 employees who will relocate to Singapore for running the operations of the Branch Office. Once their EP applications are approved, these employees can act as your local agents for the setup of the Branch Office.
You can appoint any number of extra local/foreign agents for your Branch Office. An agent needs to be an adult (18 or above), and shouldn’t have been charged for any criminal activity or shouldn’t have been bankrupt in the past.
Company Secretary – There is no need to appoint a Company Secretary for a Singapore Branch Office. However, it is suggested to appoint a Company Secretary so that your Branch Office operations comply with the Singapore laws.
Registered Office Address – Any Singapore registered company must have a local registered office address. PO Box addresses are not allowed and it should be a physical address. Some types of businesses are permitted to hold a residential address.
Memorandum & Articles of Association – The Memorandum & Articles of Association of the parent foreign company needs to be submitted to the ACRA. The Memorandum describes the activities in which the company could engage and the Articles of Association elaborate the rules that govern the management of the company.
TAX REGULATIONS FOR SINGAPORE BRANCH OFFICE
- From the perspective of taxation, a Singapore Branch Office falls under the category of a non-resident company.
- A non-resident company doesn’t receive the tax incentives offered to resident companies or new start-ups; for this reason most foreign parent companies choose to establish a Singapore Subsidiary Company.
WHAT FOREIGNERS MUST KNOW BEFORE ESTABLISHING A BRANCH OFFICE
Hire a Professional Service – A foreign entity or an individual should hire a professional service that is specialized in establishing businesses in Singapore for registering a Branch Office.
Work Pass for Management Employees of Foreign Company – Apply for Employment Pass (EP) if you are a foreign entity seeking to relocate your management employees to Singapore for running the operations of the Branch Office. Get more information by checking Singapore Employment Pass.
Foreign Companies that don’t need Employee Relocation – A foreign entity that does not want to relocate their employees to Singapore for running their Branch Office can hire the Nominee Agent service provided by Richmond for appointing 2 local agents to meet the essential requirements for registration.
PROCESS AND DURATION FOR ESTABLISHING BRANCH OFFICE
The registration with ACRA requires 2 steps:
- Approval of proposed name
- Registration of Branch Office
The ACRA has no rule for allowing foreign entities to self-register. It is possible to hire the services of Richmond for registering your Singapore Branch Office. You don’t have to be present in Singapore for the registration process. If all the required documents are available, it takes 1 or 2 days for approval.
After approval, the ACRA will send out an email confirmation for the registration. This registration remains in force for 1 year and needs to be renewed annually.
CREATING A CORPORATE BANK ACCOUNT
After the Singapore Branch Office is incorporated, it is possible to apply for a corporate bank account with Singapore or international bank that is based here, or overseas in special cases.
If you cannot visit Singapore, you have the freedom to select a bank that lets you open a corporate bank account even in your absence. HSBC and Standard Chartered Bank are examples of 2 global banks that can do this for you.
IMPORTANT INFORMATION POST INCORPORATION OF BRANCH OFFICE
Permits and Licences – Certain types of business activities need to be carried out under the rules and regulations of the Singapore authorities. It is essential to obtain a licence(s) or permit(s) from the respective government authorities before you can start your business operation.
Private schools, childcare centers, travel agencies, video firms, financial advisers, banks, credit companies, liquor distributors or companies that deal in liquor must have a proper licence from the government. Even if your Branch Office is registered, you cannot run your business unless you have the appropriate licence or permit.
Duty Hours – In addition to having a registered office address, it is also essential that the office remains open to the public for at least 3 hours a day on business days and during regular business hours.
Business Registration Number – The registration number provided by the ACRA should be printed on all documents including invoices and letterheads involved in official communication.
Registration with Customs – If your Branch Office engages in any business that involves transshipment, export and import across the Singapore border, it will be required to register your Singapore Branch Office with the Customs. The Customs office will then issue you a Custom Registration or CR Number.
Singapore GST Registration – The Goods and Services Tax or GST applies on the goods and services supplied in Singapore or imported into Singapore. The current GST rate is 7 percent. GST doesn’t apply to the goods exported out of Singapore or the international services offered from the country.
If a Singapore business has an annual taxable income of over SGD 1 million, they must register for GST. It is again required for Singapore companies that produce taxable supplies and have expected annual taxable income of over SGD 1 million. A business is required to register for GST in 30 days from the period it has been found to be eligible for this tax.
Voluntary registration for GST is also possible. The IRAS Comptroller will determine whether to offer voluntary registration or not. After approval, your business should renew the registration for minimum 2 years.
Registering for Singapore Central Provident Fund (CPF) – The CPF is a mandatory pension fund scheme that the employees and the employer must contribute a specific percentage of their monthly income. The employer must compulsorily contribute to the CPF of all the local staff who are Singapore permanent residents or citizens and earn over SGD 50 per month.
The highest CPF contribution rate is 20 and 16 percent for employee and employer respectively. It could be lower according to many factors like the permanent resident status and age of the employee. It is not essential to make CPF contributions for your foreign staff.
CONTINUAL COMPLIANCE REQUIREMENTS FOR SINGAPORE COMPANY
After the registration of your Singapore Branch Office, it is important to comply with the standard requirements laid down by the ACRA and the Inland Revenue Authority of Singapore.