Mistakes to Avoid When Incorporating a Business in Singapore
The fast and simple process of incorporating a company in Singapore is definitely one of the reasons why The Lion City is considered as one of the best places in the whole world to start a business. Their government has made it in such a way that foreign investors and budding entrepreneurs won’t find it too hard and complicated to join Singapore’s bustling and progressive economy.
Despite the great ease of starting and doing business in Singapore, in general, starting your own company still isn’t a walk in the park. No matter how speedy and hassle-free their process is on incorporation, some of the hurdles and pitfalls that you may encounter are simply inevitable, most especially during the startup stage.
But regardless of those unforeseeable mishaps, we still believe that what matters is, you do these two things: (1) Once you encounter an unexpected mistake, you’ll immediately rise up, learn from it and move on; and (2) You’ll try your best to avoid doing mistakes on the things that you have full control on.
And when it comes to that, don’t you worry. Your friends here at Enterprise Assurance PAC has got your back. With our years of experience in providing accounting, business advisory, and company incorporation services in Singapore, we are committed to helping aspiring entrepreneurs and investors just like you.
So if you’re more than determined to set up your business in Asia’s Financial Hub, read up and take note of these important things you should avoid during the process of incorporation of company in Singapore.
Incomplete Documents & Requirements
Startups and other new companies that are to set foot in Singapore for the very first time are required to submit a specific set of documents and follow defined protocols. There’s a process that you have to follow correctly. The Singapore government even has an eligibility list that will require you to assure them you are not bankrupt and that you already have a set of directors and shareholders in place amongst all the other requirements. Simply put, if you fail to meet even just one of those requirements, expect to face great consequences. Don’t ever think that you can get away with incomplete compliance or try and bend the rules just because you have ‘connections’. Singapore isn’t popular for being the “Fine” Country for nothing. As a matter of fact, many foreign companies have paid fines and many investors have been imprisoned just by neglecting these rules and requirements. Examples of these mistakes are not hiring a Singapore-resident company secretary, not submitting a company constitution, divulging wrong information on forms and other documents, and more.
Careless Selection of Business Name
The Company Name Approval process in Singapore should never be taken lightly. There are set guidelines on how you’ll choose the business name for your startup. Besides, a good business name should be everything to you. It reflects what you are as an organization and what you really do for the market. If you decide on a business name on a whim and then later on you regret what you have chosen, know that the process of changing it could be very complicated, let alone costly.
Firstly, when thinking of a business name, make sure that it isn’t similar to any existing company’s business name. You may check that with ACRA if that name is available for you to use. Second, you must avoid things like:
- Including vulgar and inappropriate words
- Including terms or words that refer to Singapore’s national symbols
- Undesirable term or a kind that the Minister has directed not to accept
Choosing the Wrong Business Structure
In Singapore, there are options as to what kind of business structure or legal entity you’d like your company to be: sole proprietorship, general partnership, limited partnership, private liability company, and so on. Choosing the best and most fitting business structure for your company should never be done in random, based on emotion, or out of whim. A careful study, analysis, and planning must have to be done in order for you to determine the specific type of legal entity that’ll suit your business goals, knowledge, experience, product/service offerings, and current situation. Because naturally, the legal entity that you choose will determine the benefits and other advantages that your company is entitled to. Choosing the wrong one for your startup business will most probably lead to legal and financial consequences.
Late Incorporation of Company in Singapore
Forget the saying, ‘Better late than never’. Because in reality, when it comes to incorporating your company in one of Asia’s Four Economic Tigers, time is indeed gold. By complying with all the requirements and getting through the process of company incorporation Singapore, you get to save yourself from a ton of headaches and stress, first and foremost. Also by incorporating right away, you get more chances of having your chosen company name approved. In addition, you’ll be able to establish your company’s assets early without letting anyone stake a claim against you. The earlier you complete the whole process, the more chances of you setting a heftier equity stake for yourself, way before your business becomes really successful - as that’s the time when more parties will definitely be sharing in the equity.
Incorporating all by Yourself
For foreign investors and entrepreneurs, sad to say, you cannot register all on your own. Because according to the Singaporean law, non-resident individuals or entities cannot self-register a company. If for example you have absolutely no idea about this law and you have unfortunately done some steps in the incorporation process already, expect that the end result will just disappoint you. The incorporation of your business will never push through.
If then you really are planning to move to Singapore for your business, you are required to obtain an Entrepreneur Pass which will allow you to act as the local resident director of your company.
But in any case, the best way to go about the Singapore company incorporation process is to seek help from a reliable and trusted firm - just like Enterprise Assurance PAC. We have successfully helped plenty of foreign investors and companies set up their corporations in Singapore. And modesty aside, we take pride in the fact that they are successfully operating their businesses up to the present. So if you want to do it the right way, choose the company incorporation services provided by our team of experts. We’ll equip you with all the things you need to know about starting your company but at the same time, we’ll do all the work for you. Speak with us today to start fulfilling your business goals in Singapore!