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Strengthening Indo-Singapore Bilateral Relations to Boost Trade

Singapore continues to be one of the sought-after international business destinations, attracting investments from all around the globe. In this edition, let’s take a look into the recent stride towards fostering robust trade ties and investments between the Indian government and Singapore.

Led by the Secretary of the Department for Promotion of Industry and Internal Trade (DPIIT), Rajesh Kumar Singh, the delegation was involved in a series of discussions and strategic engagements to strengthen bilateral cooperation.

The visit, which commenced on Monday, witnessed key government officials from India engaging in high-level dialogues with their Singaporean counterparts. This established the groundwork for better collaboration and investment inflows. The delegation was actively involved in investor roundtables, showcasing the vibrant economic landscape of India along with investment avenues across various industry verticals.

India-Singapore Trade Roundtable was one of the noteworthy events, focussing on the Food and Machinery Sector. It was jointly organized by the High Commission of India in Singapore and the Federation of Indian Chambers of Commerce & Industry (FICCI) in collaboration with the Singapore Business Federation. Besides facilitating dialogue, the involved parties discussed scopes of joint ventures, strategic partnerships between businesses in India and Singapore, and the transfer of technologies.

The primary objective of the delegation was to cordially invite investors and motivate them to explore the extensive investment potential in India. This is likely to mature into stronger trade relations between the two nations.

Discussions between Rajesh Kumar Singh and Beh Swan Gim, Singapore’s Trade and Industry Ministry Permanent Secretary revealed the mutual commitment to deepen cooperation across different sectors, thereby demonstrating the importance of bilateral ties.

The delegation also actively participated in Investors roundtable discussions focusing on Renewable Energy and Electronics and Semiconductors that were organized by Enterprise Singapore and Invest India. A session of constructive dialogues followed between the leaders representing both countries as they explored viable avenues to intensify investment collaborations. Thus, the potential for strategic ventures between Singapore and India is on the cards.

Currently, Singapore stands in the 8th position among the largest trade partners of India. In 2022-23, bilateral trade between these two countries reached a mammoth $35.59 billion. This marked a commendable growth of 18% over the previous fiscal year, as pointed out by the Indian High Commission in Singapore. The positive growth trajectory highlights the strong potential for further expansion and deepening of economic engagements between the two Asian countries.

With these developments, Singaporean entities would be looking for company formation in India and capitalize on the opportunities. The IMC Group continues to be a trusted partner for company formation for global businesses expanding across borders, offering professional counselling and assistance.

India and Singapore Strengthen Economic Partnership: An Examination of Trade and Investment Trends

India and Singapore are consistently strengthening their Strategic Partnership, with Singapore contributing to a quarter of India’s trade with Southeast Asia during FY 2021-22. Furthermore, Singapore has emerged as India’s leading foreign direct investment (FDI) source, and its prominent FDI firms are actively engaging in company formation in India for urban planning and infrastructure projects across the nation. This growing economic cooperation demonstrates the significant role Singapore plays in India’s trade and investment landscape.

Economic Ties Secured by the Comprehensive Economic Cooperation Agreement (CECA)

CECA serves as an essential platform for economic cooperation between India and Singapore, initiated in 2005. Since then, bilateral trade has expanded from US$6.7 billion in FY 2005 to US$30.11 billion by FY 2022. Singapore has become India’s sixth-largest trade partner, while India ranks 12th for Singapore.

Since 1990, Singaporean firms have become one of the primary sources of FDI into India, contributing nearly 23% of total inflows, totalling approximately US$140.98 billion over that time frame. Singaporean firms play a critical role in urban planning and infrastructure development in India.

India and Singapore enjoy an expansive bilateral relationship that spans political, defense, economic, technological, and cultural ties. Both countries actively participate in various international fora and have signed various agreements to facilitate collaboration. These agreements include the Double Taxation Avoidance Agreement and Defense Cooperation Agreement, which further facilitate cooperation.

India-Singapore Ministerial Roundtable

The inaugural India-Singapore Ministerial Roundtable took place in New Delhi in September 2022. It provided a platform to explore existing and emerging areas of cooperation such as digital connectivity, fintech, green economy/green hydrogen production/use, skill development, and food security. At this event, the Monetary Authority of Singapore (MAS) signed an Agreement on Fintech Cooperation between them and the International Financial Services Centers Authority (IFSCA) of Gujarat state.

Bilateral trade between India and Singapore reached US$14.75 billion during FY 2023 (April to August 2022), a 24.7% rise over its prior-year totals. This increase is attributable to both CECA’s success and the strengthening of the Strategic Partnership between both nations.

Conclusion

India and Singapore share a robust economic partnership, reinforced by the Strategic Partnership and CECA agreements. These agreements have led to significant growth in trade and investment between the two nations. As collaboration on a variety of issues continues to expand, the future holds immense potential for even greater economic cooperation. If you are considering company formation in Singapore or India, let IMC Group assist you in navigating this promising landscape. IMC Group can guide you through the process of company formation, ensuring a seamless experience.

Singapore will Play the Leading Role in Attracting Foreign Investment into The South Asian Region in 2023

Singapore is the dream destination for investors, entrepreneurs, and expatriates alike including all businesses looking for Singapore company incorporation to expand into Asia. Companies prefer Singapore for their businesses as it has grown and developed into a financial hub, conducive for trade having world-class infrastructure, and a stable, transparent, and progressive legal and regulatory framework.

The government’s policies, for long, have positioned this city-state as a business-friendly and open-to-trade nation, attracting foreign direct investment inflows and welcoming overseas businesses to set up shop on its shores following a simple and transparent Singapore company registration process.

Many multinational corporations are already establishing their presence in Singapore, which is the fourth largest financial center globally, home to the biggest foreign exchange in Asia-Pacific, and often known as the financial capital of the South Asian region.

There has been a continuous and consistent inflow of foreign investments in Singapore from different parts of the world and especially from China. The country has a geostrategic location as the heart of the ASEAN free trade bloc enjoying free trade agreements with both China and India.

Many Chinese investors in Singapore are aggressively pursuing businesses in digital economies and are poised to build Singapore up as an Asian nodal point in new technology. Huge Chinese investments are flowing into Singapore and in tech-based ventures including AI, Crypto & Blockchain, Fintech, etc. These Chinese-backed tech ventures are also bringing in huge monetary rewards to Chinese investors at the time of IPOs.

Chinese belt and road initiatives are playing an important role in attracting FDI inflow into Singapore as they include plans to connect Singapore to many ASEAN nations and develop several free trade zones on outlying islands. Singapore is thus all set to play a leading and competitive role in FDI inflow into the South Asian region.

Singapore is a member of both ASEAN and Regional Comprehensive Economic Partnership (RCEP) agreements and witnessing significant investments in manufacturing and digitization, infrastructure, and technology including digital financial services, digital payment token services for crypto exchange, developing autonomous driving platforms, and technology with connected smart transportation services.

Cybersecurity, robotics, cloud technology, digital industrial platform development, industrial metaverse, data center development as digital infrastructure, and cross-border connectivity are also areas attracting huge foreign investments in Singapore.

Singapore’s GDP forecast for the H2 of 2022 is up 4.8% year-on-year, after growth of four percent in H1 of 2022. The nation registered a GDP growth of 7.6 percent in 2021 when the economy bounced from the impact of the COVID-19 pandemic. Singapore witnessed growth in manufacturing output by 13.8% year on year in May 2022. The World Bank ranks Singapore as a high-income economy with a gross national income of USD 72,794 per capita in 2021.

There is no surprise that Singapore’s political stability, openness to global investment, and economic strength make it an ideal destination for investors including foreign business owners seeking to invest in Singapore. It is evident from the fact that the majority of the assets under management (AUM) in Singapore originate overseas.

The most alluring for foreign investors is the quality of life the city-state offers and the most relieving is the presence of professional Business Consulting firms who can guide how to setup a local company in Singapore in the quickest possible time.

Singapore: Adding Value as a Talent, Technology and Trade Hub Globally and In Southeast Asia

The ‘Google for Singapore’ event was celebrated for the first time in Singapore on 23 August, Tuesday marking the 15th anniversary of this company. A large number of industry and government leaders, including Singapore’s Deputy Prime Minister and Minister for Finance Lawrence Wong (DPM Wong), attended this memorable event.

In Google’s 15th anniversary event, the search engine giant deliberated its plan towards empowering Singaporeans to further elevate the city state’s outstanding status as a regional and global technology innovation hub encompassing four principal pillars including investments, online safety, economic opportunities and sustainability.

DPM Wong, attending this event said, “In fact, Singapore will enhance its value as a hub for trade, technology and talent flow even as economic uncertainties prevail amid an increasingly divisive world.”

The Deputy Prime Minister, at this event, also adored Google saying that the tech giant has remained Singapore’s strong and steadfast partner since it set up its footprint in this country 15 years ago.

Drawing particular reference to the Covid 19 pandemic over the last two and half years, DPM Wong noted the praiseworthy work Google has been doing in close association with the Singapore government to help residents bridge the digital gap between studying and working from home and get connected.

DPM Wong forecasted trade and investments 15 years down the line and noted that friendship between nations will dictate and matter more in the present circumstances than in the past trade and investments.

“Increasingly, there is a new logic at work: Let us be friends first before we do business,” he highlighted, narrating the world at a turning point.

“Geo-politics is increasingly driving trade and investments. And if this trend were to continue, and it looks likely, then we are heading to a more bifurcated and decoupled world,” he said.

200 event attendees at Google’s Mapletree Business City II office on Pasir Panjang road were also reminded by DPM Wong that such challenges are not new to the Singaporeans who have dealt with such challenges since the country’s independence in 1965.

He also appraised the event attendees on investment and trade opportunities in Southeast Asia and Singapore, leading this continent in such matters.

“The digital economy in South-east Asia is only just getting started – fuelled by a huge, untapped but fast-growing digital consumer market,” he emphasized.

In light of increasing Asian wealth, a rising number of high net-worth families are consolidating their wealth in the city-state through formal structures and incorporating a Single Family Office in Singapore. This is how enhanced value creation is happening in Singapore as a trade and investment hub and as echoed by DPM Wong.

The Deputy PM also affirmed, “For its part, the Singapore Government will do everything it can to enhance its position as a hub for trade, technology and talent flow.”

Singapore is also striving hard to strike digital economy agreements with other countries to enhance trusted cross-border data flow to bring value through digital trade and innovation.

Singapore has recently entered into a Digital Economy Agreement with the UK. It also has similar pacts with Australia, Chile, New Zealand and South Korea. This new kind of trade agreement to boost digital trade is expected to attract more FDI through company formation in Singapore.

DPM Wong also stressed the importance of digitization in driving industrial growth and adding value as a tech hub. He added, “Of course, to be an effective hub, we also have to work with companies like Google to strengthen our tech ecosystem.”

Google officially launched its 3rd data centre in Singapore on Tuesday, Aug 23 and raised the company’s total investment in data and cloud facilities in the country to USD 850 million equivalent to SGD1.19 billion. Around 2.5 billion South Asian people will be able to access the services of this data centre.

Earlier an Oxford Economics report released by Google revealed that the company’s data centres in Singapore have contributed significantly to the country’s economy and generated around USD 216 million worth of economic activity in 2020.

Google Cloud and the Smart Nation and Digital Government Group (SNDGG) have secured a partnership deal to co-create innovative AI solutions for improving the work and lives of Singaporeans. The National AI Office of SNDGG has, for the first time, plans to enter into a public-private AI partnership with a renowned global technology company.

Google is also in the process of making a partnership with the IMDA and the Media Literacy Council for supporting the Digital for Life movement. This partnership will also ensure that 50,000 parents and children are trained on online safety. Be Internet Awesome (BIA) is a curriculum designed by the American tech giant to train primary school students which in turn will enhance the value of Singapore as a talent hub.

Why Should You Consider Incorporating Your Tech Start-up in Singapore

There is a reason why Singapore is popularly known as ‘Asia’s emerging Silicon Valley’.  The city-state is host to an exceptional network of over 4,000 tech-enabled start-ups in 2021 alone.  This is significant growth from about 1,000 tech-enabled start-ups in 2014.

Tech Startups in Singapore

Singapore has evidently become the tech start-up epicentre of South East Asia by raising $8.3 billion in the first nine months of 2021, nearly two-and-a-half times the $3.5 billion raised in the same period last year, according to Enterprise Singapore. This is close to 50% of the total funding for start-ups in South East Asia.

Investments in deep tech start-ups have surged from $324 million in the nine months ended Sept 30, 2020 to $861 million in the nine months ended Sept 30, 2021.

Deep Tech Funding
The government is also making every effort to develop Singapore into the world’s first truly ‘Smart Nation’. The Infocomm Development Authority of Singapore (IDA) which looks after the technological sector is on a mission to build an innovation driven economy where technology start-ups have a crucial role to play in bringing innovation and vibrancy into the tech ecosystem.

Tech Start-Up Landscape in Singapore

“Singapore is a nation where we can create possibilities for ourselves beyond what we imagined possible.” – Prime Minister Lee Hsien Loong

Singapore is ranked at 14th position in 2019 by Start-up Genome for its vibrant tech start-up ecosystem and was valued at US$25 billion.

Owing to its progressive information and technology infrastructure, friendly business ecosystem, stable political environment, conducive business policies, attractive tax laws, strategic location advantage, skilled workforce, friendly digital trade, and encouraging government schemes, technology start-ups in Singapore are amongst the fastest-growing industries in the entire Asia Pacific region.

The country boasts of its state-of-art technology that offers economic, environmental, and technological solutions to its entrepreneurs and global investors. It is why new-age entrepreneurs think of company formation in Singapore.

Singapore: The Smart Choice for Your New Business

According to a report, Singapore has birthed at least 22 unicorns, surpassing the combined total of the last eight years. Some of the industry-leading tech start-ups that have emerged as unicorns in the nation’s technology ecosystem are Carro, PatSnap, Nium, Cove, Trax, Grab, Acronis, Zilingo, Circles Life and Carousell, among others.

Furthermore, there is a huge concentration of investors coupled with the vast availability of funds in Singapore which further boosts the growth of the Singapore ecosystem. The local ecosystem benefits from over 600 accelerators, incubators and investors.

These are some of the major reasons why a lot of home-grown start-ups as well as overseas start-ups have relocated their base in Singapore. To name a few, Grab, Konigle, Interviewer.ai and Privyr are some of the tech start-ups that have relocated to Singapore.

In 2022, the economic output of the technology sector is anticipated to cross $5.3 trillion. The tech-savvy companies and entrepreneurs are leaving no stone unturned to leverage this opportunity.

The above mentioned facts and data very much prove that this is the right time for you to register your tech start-up in Singapore.

Singapore is Shaping the Future of Technology Start-Ups

Singapore has always been at the forefront of preparing for the digital future. The setting up of Punggol Digital District ( PDD) is a testament to Singapore’s reputation as the region’s digital innovation hub. It depicts Singapore’s efforts toward Smart Nation and digital economy plans.

Opening in 2024, the district will serve as a living hub for companies, students and the public to test digital and smart living solutions.

Some of the top global companies like Delta Electronics Int’l (smart living solutions), Boston Dynamics (robotics design solutions), Group-IB (cyber security services provider) and Wanxiang (blockchain solutions) along with a network of tech associations have already confirmed plans to set up their bases in Punggol Digital District.

In one of the PDDevents, Singapore Minister for Trade and Industry Minister Gan Kim Yong said, “The ecosystem will be further strengthened by the Cyber Security Agency of Singapore (CSA), Government Technology Agency (GovTech) and a network of tech associations. Together, we hope to create a vibrant ecosystem that promotes opportunities for collaboration in the digital technology space.”

His statement gives more power to Singapore’s first smart business district and promises an even better future for the technology sector in Singapore.

Guide to Incorporating Your Business in Singapore: Essential Checklist

Why Choose Singapore for Tech Start-Up

Strong IP Protection Laws
Singapore has successfully positioned itself as a ‘global IP hub in Asia’, with a range of programmes to accelerate the patenting process to match up to the demands for IP rights worldwide. Singapore company incorporation enables you to protect your innovative tech ideas through strict IP laws.
Conducive Testbed for Innovation and New Technologies
With a population of around 6 million, Singapore is considered a perfect test bed for new technologies and for testing your innovative tech ideas. It is also seen as a gateway to access the broader Southeast Asia market opportunity. This is one of the prime reasons that attract creative and innovative entrepreneurs to locate their start-ups in Singapore.
Vibrant and Thriving Technology Ecosystem
Singapore’s ecosystem of open innovation enables technology businesses to thrive in a digital economy. Leading tech companies like Facebook (now META), Amazon, Apple, Netflix and Google have their bases in Singapore. This gives an opportunity to start-ups to draw on cutting-edge research and also connect with thought leaders in their respective industries.
‘Smart Nation’ Initiative

Under the ‘Smart Nation’ initiative, the Singapore government has launched Digital Economy Framework to transform itself into a digital-based society. It is becoming a tech hub for future technologies. Some of the strategies followed by the government that supports the initiative include:

  1. Establishment of a high tech ecosystem to boost the number of local tech start-ups.
  2. Digitalisation of existing domestic businesses to spur economic growth.
  3. Tax Exemption Scheme for local companies incorporated in Singapore for the first three years. They can claim corporate tax exemption of up to 75% on their first S$100,000 taxable income and up to 50% on their next S$200,000 taxable income.
Ease of Doing Business
The start-up culture in Singapore is supported by the forward-looking government that ensures ease of doing business. Singapore has consistently been recognized as the easiest place in the world to conduct business. In fact, as per the ‘World Bank Annual Ratings 2022’, Singapore is ranked at 2nd position among 190 economies across the world in the ease of doing business. Also, as per the Economist Intelligence Unit’s ‘Business Environment Rankings, 2022’, Singapore ranks 1st in the Asia Pacific and the world for having the best business environment.
Funding Support from Government

The government in Singapore offers various attractive grants, incentives and funding schemes that assist entrepreneurs and start-ups to launch and expand their operations from Singapore. Enterprise Singapore is a government agency supporting the growth of Singapore enterprises. Action Community for Entrepreneurship (ACE) is responsible for driving entrepreneurship and innovation in Singapore. The organisation helps Enterprise Singapore to offer grants to start-ups.

Minister for Trade and Industry, Gan Kim Yong said, “The Government is committed to supporting research and innovation. Under the Research, Innovation and Enterprise 2025 masterplan, or RIE2025, the Government will invest S$25 billion to anchor Singapore’s positioning as a Global-Asia node of technology, innovation and enterprise.”

A Complete Guide for Doing Business in Singapore

Substantial Grants and Incentives for Tech Businesses in Singapore
Some of the grants offered by the government agencies to tech start-ups in Singapore to accelerate their development and fund their operations include:
Startup SG
Startup SG is a SPRING Singapore-led programme that unifies an array of start-up support grants and schemes under an umbrella initiative. The programme has six unique pillars that deal with the various aspects of a start-up ecosystem. Let us take you through each pillar of the Startup SG programme in detail so that you can tap on these schemes to avail financial, talent and capability support if you plan on starting a new company in Singapore.
Startup SG Tech

Start-up SG Tech scheme acts as a platform for entrepreneurs to access local support schemes. The scheme is specifically targeted at tech start-ups. It provides early-stage funding to local Singapore companies for commercialising proprietary technology ideas.

The scheme aims to offer funds for Proof-of-Concept (POC) and Proof-of-Value (POV) projects. POC projects can avail grants up to S$250,000 if the project is designed for testing the technical and scientific viability of new technology. Whereas, POV projects can avail grants up to S$500,000 if the project is designed for testing the commercial viability of a lab-proven technology.

Start-ups that meet the below-mentioned criteria are only eligible for Start-up SG Tech scheme.

  • Core R&D activities to be carried out in Singapore
  • The company should be incorporated within the last 10 years at the time of grant application
  • Company is not a subsidiary of a corporate entity at point of incorporation
  • Group annual sales of the company is not more than S$100 million or the group employment size is not more than 200 people
  • The local shareholding of the company should be minimum 30%
Start-up SG Tech offers grants to companies in the sectors such as advanced manufacturing and robotics, biomedical sciences and healthcare, food science and technology, agritech, information and communications technologies, precision engineering, transport engineering and clean technology.
Startup SG Equity

Startup SG Equity scheme aims to stimulate private sector investments in innovative Singapore-based technology startups. The scheme is specifically targeted at general tech start-ups and deep tech start-ups. While general tech start-ups are companies that use existing technologies to provide an online solution for an offline problem, deep tech start-ups are companies that deal with high level issues and bring advanced solutions to complex challenges affecting humanity.

The scheme aims to assist start-ups engaged in technology innovation to access funding from private investors. It is a co-investment scheme in which the Singapore government will co-invest with private investors in start-ups that require significant capital expenditure and time to be commercially viable.

Singapore government will co-invest in a 7:3 ratio i.e., the government will offer 70% funding in an initial investment round of S$250k to the start-ups that are improving existing technologies. At a later stage, the government will co-invest in a 1:1 ratio i.e., it will invest S$1 for every S$1 invested by private investors up to a maximum of S$2 million.

For deep tech start-ups, the government will co-invest in a 7:3 ratio i.e., the government will offer 70% funding in an initial investment round of S$500k. At a later stage, it will co-invest in a 1:1 ratio i.e., the government will invest S$1 for every S$1 invested by private investors up to a maximum of S$4 million. In the last stage, it will co-invest in a 3:7 ratio i.e., the government will invest S$3 for every S$7 invested by private investors up to a maximum of S$8 million.

Start-ups that meet the below-mentioned criteria are only eligible for Startup SG Equity scheme.

  • The company should be Singapore based and the core operations must be carried out in Singapore
  • The company should have been incorporated as a private limited company for less than 10 years
  • The company should prove that its products or services and applications offer substantial innovative and intellectual property
  • The company should have the potential for high growth and show its ability to scale in the international market
  • The company should not be a subsidiary or a joint venture
  • The company should have a paid-up capital of minimum S$50,000
  • The company should not be involved in illegal acts or acts that are against the public interest such as gambling, tobacco-related products etc.
  • The company should have identified an independent third-party investor
Incorporate your Tech Company in Singapore with IMC Group
With easy and efficient access to IP protection laws, testbeds, grants and resources, Singapore is the most ideal destination to incorporate your tech company and establish your presence in Asia. If you need help with your technology company formation in Singapore, get in touch with IMC Group and find out more about our company incorporation services.
Singapore Tech Landscape at a Glance
How to Incorporate Tech Startup in Singapore - FAQ
1) How do tech start-ups get funding in Singapore?

Tech start-ups in Singapore get funding via the following methods:

  • Cash grants
  • Government funding
  • Tax incentives
  • Angel investors
  • Venture capitalists
  • Incubators
  • Accelerators
2) How do tech start-ups benefit from start-up schemes and grants?
Tech start-ups benefit from start-up schemes and grants in the following ways:
  • Quick access to funds
  • Eases cashflow
  • Provides the capital needed to perform key business activities like conducting market research and Research & Development
3) What are the different business structures for tech start-up registration in Singapore?
You can register your tech start-up in Singapore with any of the below-mentioned business structures:
  • Private Limited Company
  • Limited Liability Partnership
  • Limited Partnership
  • Partnership
  • Sole Proprietorship
4) Which is the ideal business structure for tech start-up registration in Singapore?
The most ideal business structure for tech start-up registration in Singapore is a private limited company. It is dynamic and scalable. Moreover, a private limited company also limits your liability to your share capital.
5) What are some of the key considerations for starting a technology company in Singapore?

When you have decided to launch your tech company in Singapore, a few questions that you might need to ask yourself are:

  • What are the associated risks? Does the technology have clearly defined applications and a definable market?
  • Is it going to be a disruptive technological innovation? If not, which category will it fit into?
  • Who will own the intellectual property rights?
  • When can the product hit the market?
  • Will you be the sole founder or group of founders?
  • What will be the role of founders?
  • Whether it will be a small sustainable business or grow as a company or go for public listing or position itself for acquisition?
  • What will be the initial valuation of the company? Will there be a need for private investments for long term growth?
  • Do you want to limit your liability?
6) How long does it take to incorporate a technology start-up in Singapore?
If all the documents are in order, incorporation of a technology start-up in Singapore takes only 1 to 3 days.
7) Is it mandatory to have a local director for a Singapore Tech Company?
Yes, it is mandatory to have at least 1 local director who is either a natural resident of Singapore or a permanent resident or holder of an Employment Pass, Entre Pass or a Dependant’s pass.
8) How much share capital is required to incorporate a tech company in Singapore?
As per provisions of the Companies Act in Singapore, you can incorporate a tech company in Singapore with just S$1 share capital. You can increase the share capital in the future as per your choice.
9) What are the minimum requirements to incorporate a technology company in Singapore?
You can incorporate a tech company in Singapore with a minimum of one share, S$1 paid-up capital, one shareholder, one local resident director, and a local registered address.
10) How many directors are required for private limited company formation in Singapore?
Private limited company formation in Singapore requires at least 1 local director who is either an ordinarily resident in Singapore or a Singapore citizen or permanent resident in Singapore or holder of an Employment Pass or Entrepreneur Pass. The person should be 18 years of age or above.
Millionaires are on the Move to Singapore – The Country Ranks 3rd in Attracting High Net Worth Individuals

While the COVID-19 pandemic has significantly disrupted the economies around the world, there is a section of the society that has seen a record rise in their wealth during this time. We are talking about the super-rich segment of the population whose wealth has increased exponentially during this period.

According to The Wealth Report 2022 by Knight Frank, the global population of Ultra High Net Worth Individuals (UHNWIs) increased by 9.3% in 2021. These are the individuals having net assets of US $ 30 million (SG $ 40.7 million) or more.

In Singapore alone, the population of ultra high net worth individuals grew by 8.6% to 4206 in 2021 which is up from 3874 in the year 2020.

Another report by Knight Frank indicates that Singapore’s population of ultra high net worth individuals is expected to increase by almost 300% by 2026.

In fact, this has also been affirmed by Forbes List of Singapore’s Richest in 2021 which states that the consolidated net worth of Singapore’s 50 most affluent individuals rose to the US $ 208 billion in 2021 which is a whopping 25% increase compared to last year.

Not just Singapore, entire Asia is seeing a hike in the ultra-wealthy population. In 2021, Asia witnessed a 7.2% hike in ultra-wealthy population. Furthermore, Asia is anticipated to surpass Europe as the second-largest wealth hub by 2026.

HNWI Migration Trends in 2022

The 2022 Henley Global Citizens Report, which tracks global private wealth and investment migration trends states that Asia’s prime hub of affluence – Singapore continues to attract millionaires from other parts of Asia and across the globe with an expected net inflow of 2800 HNWIs this year. This is close to an 87% increase compared to 2019’s figure of 1500.

At present, among the top 10 countries with the highest inflow of high net worth individuals, Singapore ranks at 3rd position, after the UAE and Australia.

It is anticipated that Singapore’s high net worth population can grow by 3.4% in 2022. This also means, that nearly a quarter of the Singapore population will be represented by wealthy individuals.

It is highly likely that Singapore being the biggest wealth management centre in Asia, it will continue to attract many more ultra wealthy individuals to relocate to the island nation in the near future.

Why are Rich Migrating to Singapore?

The top drawing factors for ultra rich individuals to migrate to Singapore are political stability, economic stability, a plethora of business-friendly incentives, tax efficiencies, modern infrastructure, a pro-business environment, a strong legal system, a higher standard of living and an advanced healthcare system, among others.

Besides, Singapore’s strategic geographical location acts as the gateway to cities in the Asia-Pacific making it an even more attractive destination for many. This has also led to a concentration of wealth and a growing ultra rich population in Singapore.

As a result, more and more people are keen to explore the abundant opportunities present in this island country.

Singapore is also the first preference for several HNIs in other parts of Asia as they provide a reliable infrastructure for wealth preservation. Furthermore, Singapore is a preferred choice for digital entrepreneurs and family offices owing to its easy access to world-class financial advisors.

How Will This Impact Businesses?

With a high concentration of HNWIs in Singapore, there will be strong growth in the overall economy.

Some of the fastest growing sectors in Singapore in 2022 include banking & finance, Software & Technology, Healthcare, manufacturing, Artificial Intelligence, Data Science & Analytics, Biomedical & Biotechnology, Mental health, Tourism & Hospitality, and Digital & Internet Marketing.

Owing to the tremendous growth, company formation in Singapore is on a rise.

Thinking how to register a company in Singapore? Reach out to us for a free consultation on Singapore company formation or to start your own single family office in Singapore.

Why It’s Better to Outsource Company Secretarial Services

There is no doubting that corporate secretary is another of the crucial posts that should not be left unfilled in the smooth operation of a business. Even though professional corporate secretary doesn’t really make decisions, they guarantee that every decision made has been reported to the appropriate individual. Actually, their functions and responsibilities are extensive, and they play a critical part in the firm’s efficient running.

When you have taken the decision to export your business’s secretarial responsibilities, you must make an intelligent decision. You don’t want to employ a firm just to come to repent your decision later. In this post, we will discuss the blunders you should avoid while outsourcing business secretarial services.

Some Mistakes You Should Avoid When Employing Company Secretary Services Singapore

Below are a couple of things to keep in mind when you are exporting your firm’s corporate secretarial responsibilities.

Putting Your Trust in any Inexperienced Agency:

Many managers are prone to depending on the very initial corporate secretarial firm they come across simply because people are in the rush. When you have been performing this, it is indeed time to changing company secretary in Singapore plan. Corporate secretarial firms are not all made equal, and thus the grade of services provided may differ from company to company. Utilise the assistance of an expert corporate secretarial firm to obtain a greater return upon your investment.

Choosing the Most Cost-Effective Service:

With many more service suppliers to pick from, it may be difficult for anyone to select the finest one. Some businesses charge cheap rates to entice naïve customers. Even if you are having financial difficulties, you shouldn’t ever focus your search just on price.

This is usually a great idea to investigate several agencies and see what they want to provide. Rather of choosing a service supplier just on pricing, spend a bit of time researching essential factors such as expertise, services offered, and reputation, to name a few. Your research should not end there because you have to choose an agency which best fits with the aspirations and goals of your organisation.

The Value of Singapore secretarial compliances for a private limited company

Every firm has secretarial chores which should be performed by competent employees to achieve optimal business efficiency. Yet, keeping up with these responsibilities may be difficult when you are operating a complete firm on your own.

For example, the Corporations Act requires companies to produce certain paperwork by specified timeframes, which would be the job of corporate secretaries. Businessmen may easily fix this problem by outsourcing corporate secretarial solutions that will free up their time to concentrate on other important company activities.

Accurateness:

Running a business is a difficult endeavour wherein the efficiency and correctness of the overall process are important. Companies can benefit from correct and timely management of vital business tasks by exporting secretarial solutions. As a consequence, any possible legal difficulties are avoided because all legal procedures are completed on time. Therefore, you didn’t have to think about handling the filing of finance or taxes reports because experienced corporate secretarial compliances in Singapore may simply manage it.

Experience and knowledge:

While running a business, particularly a new one, you need every expert assistance you can obtain. It is obvious that every organisation may now engage skilled personnel with experience in addressing various administrative concerns. However, this is very viable to outsource secretarial services since you would be working with a certified, skilled, and experienced corporate secretary.

Conclusion

Exporting corporate secretarial responsibilities is another of the finest moves you would ever make throughout your quest for business success. You must take caution while selecting a service supplier, just like you would with anything else. You will never repent your decision if you take this move.

Top Three Mistakes While Managing Accounting Yourself

Business owners have to make tough choices daily. It becomes crucial when managing the existing resources and strict deadlines. Hence, business owners go for addressing critical tasks like accounting and bookkeeping on their own. However, this can easily backfire as, technically, the business owners or entrepreneurs are not accounting professionals. The solution is a quick association with the accounting services in Singapore for full-proof accounting work for budding businesses. Let us understand business owners’ critical mistakes while managing all the accounts alone.

Top Three Mistakes While Managing Business Accounting Yourself:

Accounting errors may be substantial or minor. Some of the top mistakes that business owners make while managing the business accounting themselves include:

  1. Proofing and reconciliation issues: Bookkeeping is crucial to keep yourself on the top of the account dealings. Whether a tax return or the bank statements, expense receipts, profits, etc., proofing errors is unbearable for any business. These can overshadow the dedicated account management and may even lead to wrong payments or duplicate payments.

    Reconciliations become important to check the status of customer payments and catch any possible bank errors. Furthermore, in the growing digitization age, it is crucial to ensure that there is no fraudulent activity through accounting systems. Further, it helps business owners keep an eye on how much cash or credit is left in the company’s accounts. Accounting professionals can effortlessly manage all these crucial proofing and reconciliations. Their teams have experience managing different business accounting and hence know the possible loopholes.

    2. Unrecorded expenses: While using a dedicated accounting system for your business, it records the possible expenses as soon as it is deducted from the accounts. Hence, it is easy to keep track of the recorded expenses made digitally or through cash receipts. The unrecorded expenses like paying through personal accounts at different places, which is quite common in startups, are unnoticed by the eyes of the accounting system.

    It all comes down to managing all the real-time expenses at the right time in the accounting system. The accounting professionals prefer to keep track of every single penny to eliminate any proofing or reconciliation issues afterward. Business owners usually consider the expenses based on the amount and forget to consider the small expenses due to busy schedules. Hence, it becomes important to get connected to the accounting and bookkeeping services that records all the business expenses to avoid any last-minute errors.

    3. Data issues: Any digital system like an accounting system used by the business owners is as good as the quality data entered in it. A busy business owner is subject to human errors when it comes to entering the accounting data into the system. These wrong entries lay the base for multiple errors in the accounting and bookkeeping of the business.

    Professional accounting and bookkeeping service providers understand the need for correct and timely data entries. On the other hand, it is difficult for business owners to seek specialized training in accounting and bookkeeping while there is a lot to manage. Hence, to eradicate multiple issues in business accounting, it is recommended to seek the help of professionals. Multiple accounting software considers the bills, proofs, etc., while entering data or offers direct export options for eliminating human errors. Thus, it becomes easy to eliminate the delayed entries or wrong entries.

Conclusion – Hiring Best Accounting and Bookkeeping Services Is Best Option:

Experienced accounting professionals should be entitled to the business’ accounting and bookkeeping services. It is easy to get in touch with the outsourced accounting services in Singapore, which offers accounting and bookkeeping services at affordable prices to different businesses. The peace of mind provided by these accounting experts is not to miss, which helps business owners focus on their strengths.

Singapore Budget 2022 – IMC Group Highlights Key Changes

On Friday, 18 February 2022, Minister for Finance, Mr. Lawrence Wong announced the Budget Statement for the Financial Year 2022. In his speech, he stressed upon the importance of a fair and progressive tax rate in the country. The major tax changes and increased social spending in Budget 2022 also highlight that the Government is investing in strengthening Singapore’s social compact.

IMC Group has deeply analysed the budget 2022 and brings to you key changes that can impact the tax structure in Singapore.

One of the biggest announcements from the budget is the increase in GST rate which will happen in two stages.

Year

GST Rate

1 January 2023

7% to 8%.
1 January 2024

8% to 9%

Furthermore, a committee will be set up to ensure that businesses in Singapore do not try to profit from this increase by raising the prices of their products and services in the name of GST increase. The Ministry of Finance has also announced an additional top-up of $640 million to Singaporeans to cushion the impact of the GST increase making the Assurance Package to $6.6 billion.

The increase is complemented by the permanent enhancement of GST Voucher scheme in the following 3 ways:

  1. Every adult Singaporean aged 21 and above will get cash payouts ranging from $700 to $1,600 over the next 5 years;
    Eligible Singaporean households will get additional GST Voucher U-Save rebates ranging from $330 to $570 over the next 4 years to offset the cost of utilities;
    Eligible lower-income seniors will get GST Voucher cash payout ranging from $600 to $900 over the next 3 years.
  2. All Singaporean children aged 20 and below and seniors aged 55 and above will get a total of $450 in MediSave top-ups over the next 3 years
  3. All Singaporean households will get another two rounds of Community Development Council (CDC) vouchers worth $400 over 2023 and 2024. These vouchers can be used at heartland stores as well as major supermarkets.

The above move will support retiree households to combat the impact of the total increase in GST that they have to pay. For lower-income households, without seniors in their family, these vouchers will offset about half their total GST expenses every year.

Over and above this, for vulnerable households who may need additional support, the Citizens’ Consultative Committees ComCare Fund will get a $5 million top-up over the period of five years, while the four self-help groups will get a total of $12 million over the period of four years. The personal income tax rate for individuals in the top marginal tax bracket in Singapore will increase from the year of assessment 2024. Those earning between $500,000 and $1 million will see an increase in personal income tax rate from 22% to 23%. While those earning in excess of $1 million will see an increase in personal income tax rate from 22% to 24%.

Note: Those earning between $320,000 and $500,000 will not see any change in their income tax rate in this budget. They will still be taxed at 22% without any change. For small and medium sized enterprises various support packages are announced to provide temporary relief for businesses and workers.

  1. H4 Skills Future Enterprise Credit
    This grant aims to support businesses to upskill their employees by waiving Skills Development Levy contribution requirements on them. As a part of the initiative, up to  $10,000 credit can be used to offset up to 90% of expenses for transformation initiatives.
  2. Productivity Solutions Grant
    Around $40 million will also be set aside for businesses to apply for subsidised accounting and point of sale solutions to combat the impact of GST increase and raise productivity.
  3. Small Business Recovery Grant
    Small and medium sized enterprises in the eligible sectors will receive $1,000 per local employee they hire, up to $10,000 per firm.
    Sole-proprietor, partnerships and stallholders including SFA-licensed hawkers, market and coffeeshop stallholders in eligible sectors that do not hire local employees will be given a $1,000 one-off grant.
  4. Jobs Growth Incentive
    The said grant will be extended to September 2022 to support the hiring of mature and vulnerable workers.
  5. Advanced Digital Solutions
    Starting from 1 April 2022, SMEs offering advanced digital solutions will receive up to 70% funding support for qualifying costs on digital solutions.
  6. Grow Digital
    Starting from 1 April 2022, SMEs will receive 70% co-funding to onboard cross-border digital platforms.

Another important tax rate hike was seen for those who own a non-owner-occupied residential property in Singapore which includes investment properties. At present they are taxed at 10% to 20% but following the budget, the property tax rate for such properties will be raised to

Year

Tax Rate

2023

11% to 27%
2024

12% to 36%

The excess amount to pay will depend on the annual value of the home. The said tax rate increase will apply to all non-owner-occupied property in all annual value tiers.

The property tax rate for owner-occupied homes with an annual value above $30,000 will also be raised. At present they are taxed at 4% to 16% but following the budget, the property tax rate for such properties will be raised to 6% to 32%. The tax rate change will only affect families who stay in a private property with an annual value above $30,000.

The hike in tax rate signals that the government is taking initiatives to resolve rising wealth inequality in a country. The move is set to increase the government’s property tax revenue by approximately S$380 million annually i.e. around 12% of the existing property tax collection of $3.1 billion. The government has announced an increase in carbon tax rate from the present

Year

Tax Rate

2024 and 2025

$5 per tonne to $25 per tonne

2026 and 2027

$45 per tonne

2030

$50 to $80 (Goal of reaching)

The current tax of $5 per tonne remains unchanged until 2023.

No additional carbon tax will be imposed on petrol and diesel.

Going forward from 2024, large emitters in Singapore will be able to buy international carbon credits to reduce the carbon tax they pay. The minimum qualifying salary for Employment Pass will be increased from $4,500 to $5,000. For the financial services sector, the minimum qualifying salary for Employment Pass will be increased from $5,000 to $5,500. The above-mentioned changes will be applicable from September 1, 2022, for new Employment Pass applications and September 1, 2023, for renewal applications.

Besides Employment Pass salaries, the salary thresholds for S Pass holders will also be raised. The minimum qualifying salary for foreign workers on S Pass will be increased from the current $2,500 to $3,000 for new applicants from September 1, 2022. For the financial services sector, a higher salary threshold of $3,500 will be in effect.

From January 1, 2024, the Dependency Ratio Ceiling (i.e., the proportion of foreign workers a firm can employ) will be reduced from 1.7 to 1.5.

The above write-up summarises the key changes in Budget 2022.

Are you Looking to Venture into a Startup Business in Singapore? These 7 ideas can guide you through in 2022

Why Singapore?

Singapore is well known for its business-friendly policies. It is the leading startup hub not only in Southeast Asia but in the world. The city-state is the gateway to Asia with great global connectivity and easy access to top-quality talent and business advisory services. The country provides infrastructure and funding support and is an ideal destination expand your business in a growing consumer market in Asia, China and India. Additionally corporates can also enjoy the benefits of a low tax rate, various business incentives, and a supportive startup ecosystem which make Singapore an attractive hub for company incorporation.

Though the covid 19 pandemic hit hard all world economies including Singapore and many businesses pulled down their shutters, Singapore witnessed many startups and SMEs growing and prospering during this time. The country still offers profitable, scalable and sustainable business opportunities and remained encouragingly resilient during this economic upheaval

Why are Companies Registered in Singapore?
The ease of doing business, business opportunities, the fact that it’s a great place to work and live, and

  • The rate of corporation taxation is 17%
  • Dividends are not taxed
  • Foreign Investment Facilitation
  • No capital gains tax
  • A low 7%* value-added tax  and revised to 8% from 1 Jan 2023

There are all reasons why companies register in Singapore.

High In-demand and Profitable Startup Ideas in 2022
Following are some low-cost startups that benefited hugely during the pandemic due to a demand surge in Singapore.

Affiliate Marketing

Affiliate marketing is an online business model that helps you to make money from other businesses when someone takes an action on your affiliate link and/or makes a purchase. This business is straightforward as merchants or advertisers will pay whenever something happens. However, the way you are paid can be tricky sometimes and needs an understanding.

Following are the ways to get paid.

Cost Per Action (CPA) is a performance-based scheme where you are paid as and when an action happens, or a lead is generated without a monetary transaction. If a web user fills up a form without making an actual purchase, you will earn a certain amount of commission as it leads to identifying a potential customer.

Cost Per Sale (CPS) payment scheme applies as and when there is a transaction, and a customer buys a product through your affiliate link. You get a commission from the sale. This scheme is considered more cost-effective and less vulnerable to fraud or manipulation.

Pay Per Click (PPC) is an advertising scheme where advertisers pay commission to you whenever one of their ads is clicked and a phone lead is generated. This works with a call tracking system that uses a tracking code and converts to a generic number.

Drop shipping

The future of drop shipping businesses looks bright in Singapore as the country’s e-commerce market is expected to grow at a high CAGR for years to come.

It is an online business model which is gaining popularity in Singapore and doesn’t require you to be tech savy or financially savvy.

This business involves you selling goods and services online either on your website or creating accounts in reputed shopping platforms and without holding any inventory. Once a sale transaction is done, the supplier will pack, prepare and ship the goods for the customer, and you earn the margin difference.

You, however, need to address a few aspects for a profitable business including identifying the reliability of suppliers, quality of products, speed of delivery, customer feedback and any restrictions imposed by the shopping platforms.

Telemedicine

Singapore based telemedicine startups are making significant positive impacts on the way remote or virtual healthcare is accessed by patients. A full stack of technology solutions is utilized to provide an enriching customer experience by creating more convenient and easier reach to physicians and healthcare professionals. You can also start a telemedicine business for pets.

The Ministry of Health (MOH) Singapore will start licensing telemedicine in the middle of 2022 and once you comply with the MOH telemedicine e-training and register, you can start providing consultations under the Community Health Assist Scheme. As the hospitals and outpatient clinics are very crowded in Singapore, the Telemedicine business holds promise in the future.

Healthy food supply

Singapore Food Authority doesn’t impose licensing requirements for home-based food supply businesses considering very few food safety risks. This business is trending and is an easy, hassle-free and convenient startup for you. However the scale of business in a residential setup can be limited.

You need to identify competition in this segment and be attentive to how other food supply businesses are designing their posts on social media. You need to consider healthy sustainable foods and may also think of utilizing smart technologies in your kitchen such as smart cookers, smart fridges etc. in future. Promotional packaging can also be a good idea to grow your customer base.

Digital content marketing

Singapore has one of the highest online penetration in the world and if you can provide quality and engaging content to promote companies and brands, you can venture into an online startup business in Singapore. This is trending and holds great promise for growth and profitability as more than 60% of leads today come through content.

You need to provide great content with valuable and useful information as blogs or copyrights to promote a business to a range of prospective customers. Digital content marketing is the future of conventional marketing as it can access a wider and more diverse audience. Companies using content marketing usually register higher business growth.

For great content, you need to connect with bloggers and copywriters and frequently use social media to influence the audience on your products and services.

Software as a Service (SaaS)

SaaS is in great demand all over the world including Singapore as many small and medium-sized companies are trying to automate their businesses for higher productivity, better control and reduced cost. If you can provide business or operation management software based on proven technologies and can streamline single or multiple business functions, you can start your SaaS business.

You can develop SaaS for inventory management, automatic payments, product recognition, electronic signature etc. and can use cloud services to provide a SaaS platform. There are more than 1600 SaaS startups in Singapore today and many of them are very profitable and successful.

Digital learning

Digital learning is commonly known as Education Technology or EdTech and is associated with the development and application of tools for enhancing online education. EdTech has been in use for more than two decades however, it has gained renewed importance after the breakout of the covid pandemic.

It leverages technologies such as VR, AR, Enhanced Video & Rich Media, ML, IoT etc. to promote the reach and impact of education and enables everyone to thrive as learners in a digital world. It is also used for research, innovation and professional development.

You can venture into a digital learning startup in Singapore as it is a profitable and high in demand business opportunity high growth potential.

The Takeaway
The world, no doubt, is becoming more competitive, however, many present-day entrepreneurs are still keen about doing business in Singapore.

Trying times call for sound, robust and innovative strategic themes to invest your time and resources. The above-mentioned startup ideas can help you navigate through, provided you remember that money or capital is not the last word in entrepreneurship, your love, compassion and willingness to devote time will have the lasting impact..

Author Bio:

Mr. Pankaj Kumar is a member of ICAI (Indian Institute of Chartered Accountants of India) since 2002. He has over 17 years of experience in cross border advisory, international taxation, structured finance, trade finance and management consulting. He advises MNCs and SMEs on formation of cross border corporations and business structures and structuring commercial transactions. Previously he has worked with Amicorp Group, DM Ventures, Amba Research (Singapore) and ICICI Bank. He primarily manages Client Advisory, Relationship Management & Business Development amongst group strategies and identification of new business opportunities.

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