Representative Office (RO) is a unique form of setting up a presence of foreign business that has not only some unparalleled benefits if compared to the Subsidiary or the Branch, but also very weighty restrictions.
What is a Representative Office in Singapore?
First of all, it is a business structure that doesn’t act as a corporate body. Opening a Representative Office in Singapore, the foreign company wins as it doesn’t have to pay taxes and mess with statutory documents and annual filing because the RO hasn’t any legal status. But on the other hand, this form of business cannot be used for any lucrative activity. Registering a Representative Office in Singapore is allowed only for such non-profit purposes as studying the local market, building contactsbeforelaunching a full-scale profitable activity or performing an investment and other activities that are aimed at collecting data and analysis.
The definition of the Singapore Representative Office also includes such feature as temporariness. The RO is opened for 3 years after which this business structure must be upgraded to another legal entity that allows gaining profit if the foreign business has serious intentions in Singapore. Another important feature of the Representative Office in Singapore is that this business formation must undergo annual renewals.The office must keep the government informed about any changes in its registered activity, local address or the person of the representative.
Such form of offshore business as the Representative Office Singapore ideally fits those foreign companies that need to save some efforts and money while exploring the Singaporean market and doing the groundwork before launching a full-scale business activity in SG.
How to Set up Representative Office in Singapore?
In order to ensure that the Singapore Representative Office registration is successful, the foreign company needs to fulfil some important criteria:
- Singapore RO ought to have the same name as its foreign parent company has. This name check must be made before moving on to Representative Office registration Singapore. If the needed name is already used by another SG company, we will assist in making a tailor-made decision for your particular case.
- Foreign company ought to be a well-established business (active during longer than 3 years) with the sales turnover of over 250,000 SGD.
- Parent company must place one of its employees as the chief representative at the head of the Representative Office. Such relocation is possible only on an appropriate work visa. We will help you to find the best visa solution for your chief representative.
- Materials that will be used by the RO for communication purpose must contain information about the Office’s Singaporean registration (real SG address).
- RO can hire up to 5 Singaporean employees (in the government’s opinion, you don’t need more for representative activities).
- Foreign financial company that plans to open a Representative Office in Singapore must involve an expert incorporation strategizing as this sector of economy has restrictions for this form of business. We will help you to find a reasonable incorporation solution for your particular activity.
- Registration number the Representative Office gets on the final stage of incorporation cannot be used for trading. Only export/import of the sample materials/products is allowed.
- Representative Office Singapore must be deregistered if it becomes dormant or fails to fulfil all governmental requirements. If the overseas company becomes dormant, its Singaporean RO will also be closed.
- RO isn’t allowed to get involved in trade, advertising, consulting, acting as a mediator between the parent company and its clients, leasing, negotiating with business partners, rentingwarehouses, and supervising.
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Advantages of Setting up Singapore Representative Office
- As the RO isn’t a corporate legal entity, it mustn’t pay taxes in Singapore.
- Representative Office in Singapore doesn’t have to hold any statutory documents and bother with annual filing.
Required Documents for Setting up Representative Office in Singapore
To undergo the Singapore Representative Office registration with the ACRA, the foreign company is required to provide such data:
- Completed Singapore Representative Office application
- Representative Office’s Name (get its availability checked with us beforehand!)
- Short description of the RO’s prospected activity
- MAA and the certificate about the incorporation of the parent company(certified copies are enough)
- Latest annual report of the parent company
- Copy of audited accounts of the parent company
- Representative Office’s registered Singaporean address
- Data about the Chief Representative
Unless your papers are compiled in English, you need to get them professionally translated and endorsed before attaching to the Singapore Representative Office application form and submission. Paperwork for the Representative Office Registration Singapore requires involving a great deal of time as lots of financial documents for proving the parent company’s eligibility. All papers must be compiled according to the Singapore business standards and, therefore, require awareness.
As handling the Representative Office registration paperwork is associated with doing the name check, massive business documentation and getting the local address, it is reasonable to get the whole package of papers prepared by the same team that orchestrates your RO registration. Just get your case assessed by our business consultants and provide us with the basic information about your business, and we will do the rest of the paperwork and shoulder submission of your RO application.
Foreign entrepreneurs have no access to the Singapore business registration backstage: they need to involve expert incorporation services for handling the registration. Сoincorporating can be your mediator that will instruct you in how to open a Representative Office in Singapore, lead you throughout the whole procedure and represent your business interests before the authorities. Involving our expert visa help, you not only get your new company established, but also get all necessary help in getting annual renewals and further upgrading to another business entity. You don’t have to be present in SG physically during the registration when we manage your Representative Office incorporation, and this way, you can save lots of your time and efforts for doing something more crucial for the development of your business.
The procedure of registering the Representative Office Singapore is one of the fastest on the planet: it takes most entrepreneurs only a day or two to open the new firm. However, before this short procedure can be conducted, a massive groundwork must be done:
- Name check for the future Representative Office and finding a tailor-made solution in case of coincidence (the suitable name can be reserved for 2 months with an opportunity to extend the reservation)
- Getting the Singaporean address
- Handling the Representative Office paperwork
- Polishing the parent company’s business profile
- Registration at the ACRA
After your Representative Office registration is finished, you will receive the Office’s registration number by email. This is your main business registration document in SG, as no hard copies are used anymore here. But if you need it for your personal needs, it can be issued on your request. After your RO setup is done, you will also need help in creating a local bank account and visa support in work pass application for your Chief Representative.
Remember that the Singapore Representative Office Renewal must be conducted after each year of the RO’s activity. You should lodge your renewal request no later than a week before the registration expires. Keep in mind that your office can get deregistered if you fail to renew it in time. In order not to bother yourself with such tedious administrative work, entrust our incorporation team with your annual renewals to ensure your business gets a worthy representation in Singapore. We will also help you with getting your RO upgraded to another legal entity after the 3-year period expires.
Сoincorporating will lead you through all these stages until your foreign business hits its target in Singapore. After you bring your business idea to us, you can calmly continue doing your business abroad while we assess you case, manage your paperwork, and orchestrate the Representative Office registration in the most efficient way.
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Singapore Representative Office Registration Processing Time
Modern digital technologies used by the Singaporean Company Registrar accelerated the Representative Office registration; businessmen and foreign companies can enjoy a smooth, accurate and red-tape-free incorporation. After we make the whole paperwork in accordance with the Registrar’s standards, the final registration procedure is a matter of several hours. The total duration of the Singapore Representative Office setup procedure – from the first assessment to getting the registration number – is up to 10 days. If you are interested in getting the reliable result without messing with the administrative paperwork, just entrust us with your case and sit back.
Taxation Benefits of Representative Office in Singapore
Foreign representative offices don’t have to pay any taxes as they aren’t involved in any profitable activity.
Difference between Company Types in Singapore
With the Singapore Representative Office tax and filing benefits, it winningly stands out against the background of other business forms used for setting up the foreign firm’s presence such as the Subsidiary and the Branch Office; however, the RO cannot be used for a business activity that is aimed at trading or any other form of gaining the profit. If the Representative Office doesn’t fit you because of this reason, you can consider setting up your Singaporean presence in the form of the Subsidiary or the Branch. Here are the key facts that will help you to understand the difference between Branch and Representative Office Singapore and Subsidiary:
- Subsidiary is a separate legal entity that is responsible for its mistakes on its own in the frame of its shares. It means that the Parent company is protected in cases of debts or legal prosecutions. The company’s profit is a subject to the SG corporate tax. The Subsidiary must file its accounts yearly.
- Branch shares the same legal entity with its parent firm, and, therefore, the latter is responsible for any failure of its Branch and can bear losses. The Branch is freed from paying the corporate tax, but filing must be done for both the parent company and the Branch itself.
- Representative Office isn’t a legal entity at all; it cannot be used for trade and other lucrative activities, but it frees the foreign company from filing and paying taxes.
Singapore Companies Annual Filing Requirements
As the Singaporean Representative Office doesn’t have a corporate legal nature, it isn’t obliged to file its accounts and tax returns.