Setting Up A Consultancy Business In Singapore As A Foreigner

Considered as a business hub and gateway to Asia and other key global markets, Singapore is ideally suited for foreign businesses and entrepreneurs to start their operations in the city-state and penetrate into the Asian and international markets. Its prime location, business-friendly policies, and quality infrastructure make Singapore a highly lucrative and attractive place for foreigners to register their business and start operations. Some of the top business consulting firms in Singapore have been set up by foreigners. This article discusses all the key aspects of how foreigners can set up their business consultancy companies in Singapore and how to start a business in Singapore, with a detailed overview of all the important things you need to know.

What is Business Consulting?

Business consulting services refer to the services provided by a company that helps other businesses identify problems, devise their solutions, and give expert advice on how to improve performance. A business consulting firm audits business processes and recommends action plans to improve efficiencies that lead to business growth. A business consultant helps a company identify the obstacles that are hindering its growth and devises unique strategies to overcome all challenges. The business consulting strategies can span various services, including financial management, organisational development, strategic planning and goal development, marketing, operations management, and others.

A business consulting agency in Singapore can offer services to businesses focusing on any particular market. The high number of foreign investors coming to Singapore has opened great avenues for foreigners to start a consulting business in the city-state as well.

Reasons Why Foreigners Should Incorporate Business In Singapore

Singapore offers great incentives for foreigners to incorporate a business in the city-state and business consulting firms are no exception. Singapore is an attractive destination for foreigners to open their consulting business because of the following reasons:

Attractive Tax Regime

The Singapore government charges a flat tax rate of 17% from companies but local companies that are newly incorporated can enjoy various tax exemptions. According to the start-up tax exemption scheme, a new company that has at least one shareholder owning 10% of the capital and a maximum total of 20 shareholders can enjoy a tax exemption of up to $125,000 on their first $200,000 of chargeable income during the first three years of business. Companies not qualifying for this start-up exemption can apply for a partial tax exemption of up to $102,500 for the first $200,000 of chargeable income. Singapore has also established double tax treaties with many countries worldwide, so corporate income will not be double charged.

100% Foreign Ownership

According to Singapore law, a foreigner starting a consulting business in Singapore can enjoy 100% ownership of the local company including claiming all the benefits of local Singapore incorporation.

Robust Economy

Singapore has a high-income and robust economy that is ranked among the most competitive economies of the world. Its business-friendly and expansion policies present a highly attractive environment for top business consulting firms to open their subsidiaries in Singapore.

Stable Political and Social Environment

Singapore has a highly stable social environment, making it a business hub in the Asian markets. As a politically neutral ground, businesses can also leverage on such characteristics to trade globally.

Flexible Banking Facilities

Singapore offers a wide range of attractive banking facilities for foreigners with over four local banks and more than a hundred foreign banks.

Procedure For Foreigners To Start Business Consulting Services In Singapore

Foreigners need to understand the basics of how to start a company in Singapore. Singapore offers an easy and efficient way for foreigners to start their small business consulting services. The following sections discuss the complete procedure of how to start a consulting business in Singapore.

Determine the Niche For Which You Will Be Providing Business Consulting And Services

The first step is to decide the industry for which you have the expert skill set to provide consulting services. This involves carrying out market research to see what services the competitors are offering and then devising strategies on how you can bring better value to the clients using your expertise and knowledge. You can choose a particular industry to offer specialised services or choose a cross-industry discipline like financial management or regulatory compliance. Moreover, by studying current market trends, customer needs, demographics, and preferences, you can tailor your services to establish yourself as a leading business consultant in Singapore.

Company Setup

The next step is to set up your company and make sure that the following requirements of starting a business in Singapore are met:

There is at least 1 shareholder in the company
There is at least 1 Singapore-base director of the company
There should be at least $1 paid capital
There should be a local company secretary
A registered Singapore business address

Select Business Consultancy Firm Structure

Foreigners have a number of options while selecting a business consultancy firm structure in Singapore:

Private Limited Company

A private limited company enjoys the best tax policies and offers the advantages of flexibility and scalability. A private limited business consulting company can have a maximum of 50 shareholders and has share capital.

Ordinary, Limited, and Limited Liability Partnerships

A partnership involves two or more individuals or entities. In case of an ordinary partnership, if the number of partners exceeds 20, the company must incorporate as a local company. Limited and limited liability partnership allows the partners to maintain separate legal entities with limited liabilities according to the agreed investment in the partnership.

Sole Proprietorship

Sole proprietorship is the most straightforward business structure but also carries the most risk since the business owner assumes the personal responsibility for any debts or losses.

Register Consulting Business

The next step is to register the business in Singapore. The process of company registration in Singapore for a foreigner involves the following steps:

Determine whether you want to run the company from overseas as a foreigner or locally from Singapore.
Choose the business structure
Select the company name.
Register the company with ACRA. To register your company with ACRA, you must engage a registered filing agent in Singapore to submit your application. The documents required for registration include:
- Company name
- SSIC code of the company
- Details of shareholders and directors
- Capital information
- Registered business address in Singapore
- Company structure

Ways For Foreigners To Register Consulting Business In Singapore

There are three main ways to register a company in Singapore for a foreigner for a consulting business.

Get EntrePass

This route involves moving to Singapore and applying for an EntrePass that allows foreigners in Singapore to start and operate their business in the city-state. The applicant must fulfil the following conditions to apply for an EntrePass:

The applicant must plan to start or have already started a private limited company registered with ACRA.
The applicant must meet the requisite criteria for entrepreneurs as listed in the Ministry of Manpower (MOM)’s

Obtain An Employment Pass

Another route for registering a consulting business in Singapore is to move to the city-state and apply for an Employment Pass (EP). you must employ the services of a registered filing agent to submit the EP application on your behalf. Your company can only be registered as a private limited company through this procedure. Once you become an EP holder, you can apply for Permanent Residence (PR) status in Singapore after 6 months through the Immigration and Checkpoints Authority (ICA).

Engage A Local Resident Representative

The last option for foreigners is to remain overseas and incorporate the company in Singapore through an authorised representative or appointed resident nominee director. The local resident can either be a Singapore citizen, a Singapore permanent resident, or an EntrePass or Employment Pass holder.

What Do Foreigners Need To Do After Business Registration

Once a foreigner has completed the business consulting company registration, he/she will have to carry out a few other processes to continue their business operations in Singapore. These include:

Certificate of Incorporation

After applying for company registration with ACRA, you will receive a certificate of incorporation with the Unique Entity Number (UEN), which serves as your company registration number. The certificate also includes your business profile, which has all the relevant company details. The business profile is an essential report that potential stakeholders require to carry out background checks for your company.

Employ a Company Secretary

A Singapore-incorporated company must employ a company secretary within 6 months of its incorporation.

Open A Business Bank Account

A consulting business firm in Singapore is advised to open a corporate bank account in Singapore either through traditional banks, digital banks, or neobanks.

Apply For Business Licence and GST Registration

A foreign company must apply for a business licence after incorporation before operating its business strategy consulting services in Singapore. If your company’s yearly turnover exceeds SGD 1 million, you must also register for GST; otherwise, GST registration is not required.

Get Professional Guidance

Annual Filing Requirements

Finally, according to the Singapore Companies Act, companies must adhere to the annual filing requirements. A foreign consulting business must also make sure to fulfil all these requirements.

These steps outline the procedure for foreigners to open their business consultancy services in Singapore and start operations. However, engaging a professional audit and advisory firm in Singapore to carry out the business consultancy setup can make the process easy and convenient for you. StartupBCS is Singapore’s leading high-quality corporate solutions provider with services such as HR services, and corporate tax filing that can help you mitigate risks and set up your business with ease. Contact us today for related advice.