A Representative Office is the office that is established by a company or a legal entity. It conducts marketing and other transactional duties in a foreign country. In this article, we will provide you some guidelines on how to register a Representative office in Singapore. After reading this page you will able to understand the setup requirement, methods for registration and the scope of business enterprises and taxation of Singapore.
A Representative Office provides a pathway to a foreign company that is interested in establishing services in Singapore to evaluate opportunities of business in the Singapore market. The provided avenue is also great for a foreign company that is interested to promote its name and to operate its work with regional representatives and distributors. It is a short-term setup (not more than three years), and it is not allowed to enmesh in commercial revenue-generating projects including the final contracts and opening of Letter of Credit.
Taxation of Singapore Representative Office
A Representative Office in Singapore should not be involved in any commercial revenue-generating projects. Hence, there is no need for any file for annual tax revenues. But, the income which is earned by the staff of the Representative Office and the Chief Representative should be directed to the personal income tax of the country.
Singapore Representative Office Registration Requirements
The Sales Turnover of the foreign entity should be at least US$250,000.
The number of years of establishment of the foreign entity should be more than 3 years.
The Proposed number of staff for the Registration Office should not be more than 5 people.
Things you need to know before setting up a representative office
Business Activity that cannot be registered by an IE Singapore for representative office:
The following given sectors such as educational institutes, schools, colleges, universities, venture capital, financial institution, funds management departments, bank, insurance, car leasing or fleet management, travel, manpower or labor agents, etc. does not fall under the purview of IE Singapore.
Registration of a Singapore Representative Office
Many authorities can help you to register your company in Singapore. These authorities can structure your Representative Office within 5 working days provided you have all the essential papers in order.
After the approval of the application of your Singapore Representative Office, they will also support you in the application process of Employment Pass for the Chief Representative, the one who proposes the intention to relocate to Singapore to manage services of the Representative Office. The method of approval by Singapore’s Ministry of Manpower can take about 3 to 5 weeks.
Approval and Renewal Information
The international Singapore enterprises can take approximately 5 working days for the approval of every single application. The company will send a Letter of
Approval through the email when it is assessed. The registration can be made for a maximum of a year and then directed to annual renewal.
International Enterprises Singapore will transfer a renewal notice two months before the expiratory duration of the registration. The renewable must be made within seven days before the expiration time. After three years the representative office must be promoted into a Branch Office or a Subsidiary Company.
Opening of a Corporate Bank Account
When the representative office has been incorporated, there comes the need to open a corporate bank account. You can choose any of the local or international banks in Singapore or elsewhere.
If you can’t come to Singapore then you have to select a particular bank, which does not demand your presence for the opening of the corporate bank account. There are various banks from which you can choose. Standard character Bank and HSBC are two international banks that enable you to initiate an account without your existence in Singapore.
Registration of Singapore Central Provident (CPF):
The Singapore Central Provident Fund or CPF is a mandatory pension fund system in which the employer and the employee share a portion from their monthly salary in these funds. The contribution of CPF by the employers is mandatory for all the local employees who are the citizen’s or are the permanent residents of Singapore. Their monthly earnings should be more than S$50.
The supreme ratio fixed for the contribution of CPF for the employers or employees is about 14.5% to 20% individually. This rate can be lower on specific constituents such as the age of the employee, permanent residual status, etc. This CPF contribution is not essential for foreign employees.
Registered Office Hours:
- You must have a registered office address in Singapore. The certified office must also stay open for the public for at least three hours in a single day through the regular business period on weekdays.
- The registration number of the business must be specified on the letterheads, invoices, billings or other documents that are utilized for official business communications.
- If your Representative Office plans to import and export samples of goods in and out of Singapore, you will be required to register with Singapore Customs and get a CR Number that is commonly known as Custom Registration.