Businesses all over the world have a unique potential to grow and expand in Southeast Asia. Some of the most alluring economies in the world, such as Vietnam, Indonesia, and Singapore, are found in this promising region.
Many businesses have relocated their regional or global headquarters to Singapore in recent years. Some of the most frequently cited justifications for the shift include political stability, first-rate information and communications infrastructure, and the accessibility of qualified people, but one additional important motivation has been the significant tax advantages provided to enterprises.
Setting Up a Regional HQ
Companies can manage their operations and business across multiple nations by establishing regional offices. This simplified procedure can turn out to be more effective and profitable because it gives the business better control over its operations. A regional HQ can also aid a business in extending its presence into new areas, enhancing its overall competitiveness.
To be eligible for the reduced tax rates offered by the EEIA (Economic Expansion Incentives Act) on their qualifying revenue, corporations applying to establish a Regional headquarters (RHQ) in Singapore must fulfil all the minimal requirements listed below.
To be able to enjoy these incentives:
- At the end of year one and year three of the incentive period, the company was supposed to have paid up capital of S$200,000 and S$500,000, respectively.
- The business must have established a subsidiary, sister company, branch, joint venture, franchise, or representative office in three nations other than Singapore by the end of the third year. The headquarters should provide these entities with at least three different sorts of services.
- At least 75% of the workforce must be skilled during the incentive period, which calls for them to the very least, to hold NTC2 (National Trade Certificate II) certification.
- The company should have expanded by the end of the third year to the point where it will have hired an additional 10 Singaporean experts with at least a diploma qualification.
- Five of the top executive roles should get an average salary of $100,000 by the same date.
- Corporations must spend an additional S$2 million on their annual business expenses in Singapore by the same date. This is the total cost of operations less the costs of work performed by outside contractors, the price of learning a foreign language, royalties, packaging, raw materials, and necessary tools and equipment.
Singapore: A Great Place to Do Business
Singapore is a desirable site for enterprises of all kinds since it is routinely regarded as one of the greatest places in the world to conduct business.
It has the following helpful characteristics for businesses:
-a robust economy
-an effective government
– favourable to business
-a workforce with talent and skill
-prestigious research institutions
Singapore is an essential spot for company growth and success in Southeast Asia because of these features.
Singapore’s Proximity to Key Markets in Asia
As one of Asia’s most advantageous locations, Singapore provides companies with quick access to the largest markets in the area.
This comprises the growing economies powering global economic growth, such as China, India, Japan, and others. The strategic location of Singapore in the centre of Asia makes it the perfect place to conduct business throughout the Asia-Pacific and beyond. It is also frequently seen as a stepping stone for businesses to expand into the dynamic ASEAN area.
The city-state is a great option for businesses wishing to broaden their reach in the global market.
Singapore’s Financial Incentives for Businesses, Tax Breaks, and Investment Funds
Singapore provides a range of benevolent, business-friendly tax benefits and simplified rules.
Singapore-based businesses benefit from the following tax breaks:
– Advantageous tax rates
– Zones of Free Trade
– FTAs (Free Trade Agreements)
– DTAs (Double Taxation Agreements)
– Simplified business regulations make it simpler for businesses to expand and succeed in the global market.
Singapore’s Supportive Government and Its Rewarding Initiatives
The Singaporean government is quite helpful and offers lots of financial advantages to businesses that want to set up shop there.
Over the years, the Singaporean government has accomplished the following things:
- 300 million Singapore dollars will be invested in deep-tech start-ups
- Grants that promote education and the expansion of expertise in research and innovation
- Risk transfer from bank loans to new businesses for a maximum of five years
Singapore’s Robust Start-up Eco-system Fosters Innovation and Entrepreneurship
With many incubators, accelerators, and other resources available to assist entrepreneurs to establish new businesses and grow existing ones, Singapore is home to a bustling start-up environment.
Criteria for Setting Up An International Or Regional Headquarters in Singapore
The following are the requirements established by the government for businesses to be eligible to establish their headquarters in Singapore:
- The corporation must have widespread capability in terms of human resources, assets, capital, and market share, as well as recognition within the industry or area of operation.
- The organization’s hub for senior management of key operations should be the headquarters, which should have clear management and control procedures.
- The majority of the company’s headquarters operations ought to be transferred to the Singapore office. These operations could include:
- Marketing Control, Planning and Brand Management
- Strategic Business Planning and Development
- Research, Development and Test Bedding of New Concepts
- General Management and Administration
- Shared Services
- Intellectual Property Management
- Technical Support Services,
- Corporate Training and Personnel Management
- Sourcing, Procurement and Distribution
- Economic or Investment Research and Analysis
- Corporate Finance Advisory Services
- Finally, Singapore should be the home of the managerial, professional, technical, and support employees that the company hires to oversee the operations of the headquarters.
Businesses in Singapore can profit from a pro-business administration that is dedicated to fostering innovation and entrepreneurship. Singapore offers several advantages to support the success of your firm, whether you’re wanting to establish an Asian headquarters or begin an innovation-based initiative.
So, take Singapore into consideration as your new Asia headquarters and innovation hub. EBOS is well known to service aspiring entrepreneurs, foreign shareholders and mid-size corporations in establishing their headquarters in Singapore.
Get in touch with our Success Team to find out more about how we can assist you with setting up your company in Singapore.