Offshore Company: What is it & How to Set One Up in Singapore

Offshore Company: What is it & How to Set One Up in Singapore

An offshore company is typically incorporated in order to take advantage of laws or benefits not available in their home jurisdiction, such as Singapore’s favorable taxation systems or foreign business opportunities. In this article, we highlight what exactly an offshore company is, the benefits of setting one up in Singapore and a step-by-step guide on how to do so.

What is an Offshore Company?

An offshore company is simply an entity that is incorporated in another jurisdiction than where its principals (directors, shareholders, parent company etc.) are located. In some cases, offshore companies can carry out different activities than their parent companies, however certain activities may involve permits/licenses from the relevant authorities.  

Benefits of Setting Up My Offshore Company in Singapore

Singapore is a diverse business hub ideal for multinational corporations seeking to expand into Southeast Asia. As an offshore company you will be able to benefit from Singapore’s attractive tax regime. The corporate tax rate is a flat 17% and only those revenues which are derived from Singapore or remitted into Singapore are considered taxable.  

Additionally, the single-tier tax policy helps ensure that offshore companies can distribute dividends to their shareholders tax-free provided that their income has been taxed at a corporate level.  

Furthermore, the offshore company may be eligible for a large number of tax benefits if its control and management has been exercised in Singapore for the preceding Year of Assessment (YA). Examples of such tax benefits include protection against double taxation and tax exemptions on certain types of income.

What is Required to Set Up an Offshore Company in Singapore

It’s important to ensure you have the following paperwork in order to successfully incorporate your offshore company in Singapore, this is generally what is required of businesses:

  • Name of the proposed company
  • At least 1 business activity
  • Shareholders’ particulars
  • Directors’ particulars
  • Registered address of the company
  • Company secretary’s particulars
  • Company constitution (you may use ACRA’s model constitution)
  • Any other documentary requirements as may be required by the registered filing agent

Setting Up My Offshore Company in Singapore: Step by Step

Incorporating an offshore company in Singapore is done via the BizFile+ portal managed by the Accounting and Corporate Regulatory Authority (ACRA). To login, a SingPass ID is required so foreign companies may need to engage the services of a registered filing agent to carry out these steps on their behalf.  

After uploading the documents required above, the entire process can be completed in 1 – 2 days completely online. ACRA charges a $15 name application fee and $300 registration fee for each company incorporated.

When in Doubt, Reach Out!

Sprout Asia wants you to focus on what you do best, while we take care of the rest. That’s why we offer budget-friendly corporate secretarial services. Allow our experts to organise your documents and prepare you for ventures like these with ease. Feel free to contact us with any questions you may have about our services, we’ll respond within 24 hours.