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Subsidiary Company

A Subsidiary Company is an entity whose majority shares are beneficially owned by a holding company.

Features of Subsidiary Company

  1. It is incorporated as a private limited company.
  2. It is a separate legal entity, hence the liabilities are limited to the shares subscribed.
  3. It may be owned by local / foreign company, whose shareholdings may up to 100%.
  4. It is a tax resident in Singapore, hence it is entitled to tax incentives in Singapore, namely:
    • *Tax exemption scheme for new start-up companies – For the first 3 years from incorporation, the tax rate is effectively 5.67% on the first S$300,000 of chargeable income, provided there is an individual shareholder holding at least 10% shares throughout the basis period.
    • *Partial tax exemption scheme for companies – In the event that a company is not qualified for the “tax exemption scheme for new start-up companies”, it will be given partial tax exemption. The tax rate is effectively 8.36% on the first S$300,000 of chargeable income.

*For both of the tax exemption schemes, chargeable income in excess of S$300,000 will be taxed at the prevailing corporate tax rate, which is currently at 17%.

Requirements of setting-up a Subsidiary Company

  1. There must be at least 1 Director who is an ordinarily resident in Singapore.
  2. There must be at least 1 Shareholder, can be an individual or a company with no restriction on the nationality.
  3. There must be at least 1 Secretary who is an ordinarily resident in Singapore.
  4. The company must have a registered office address in Singapore.
  5. The minimum paid-up share capital is S$1.

Documents Required

*Note: All non-English documents are required to be officially translated into English.

Without relocation of staff:

  1. Certificate of incorporation of the parent company
  2. Current registered address and directors of the parent company (preferably from the Registrar of Companies)
  3. Passport particulars and residential address details of individuals who will act as the directors of the Singapore subsidiary
  4. A corporate resolution authorizing a specific individual to sign necessary subsidiary documents on behalf of the parent company
  5. Registered business address for the Singapore subsidiary
  6. Memorandum & Articles of Association of the Singapore Subsidiary
  7. Completed application forms

With relocation of staff:

  1. Certificate of incorporation of the parent company
  2. Current registered address and directors of the parent company (preferably from the Registrar of Companies)
  3. Passport particulars and residential address details of individuals who will act as the directors of the Singapore subsidiary
  4. Completed application forms

Procedure

  1. Incorporation of Subsidiary
    1. Application for Entity Name (subject to availability and approval by ACRA required)
    2. Registration of the business
      1. Without relocation of staff:
        • Appoint a Singapore resident director for the incorporation of the company, in accordance with the Singapore Companies Act (through the engaging of our nominee services or otherwise)
      2. With relocation of staff – Apply for relevant Employment Pass (EP)
        • Online Application (7 days)/ Manual Application (5 weeks)
        • Upon receipt of the In-principle Approval notification, arrangements will be made for the collection of your Employment Pass.

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