Before you hire any employees, you need to learn how to set up a Singapore subsidiary or plan to work with a global PEO. The process to set up a subsidiary is based on complex Singapore subsidiary laws.
How to Set Up a Singapore Subsidiary
The Singapore subsidiary setup process is as follows:
- Get your company name approved and reserved.
- Find a registered office with a location in Singapore.
- Appoint two members of your company to act as representatives for the Singapore subsidiary.
- Hold a company seal for any problems that arise with authenticating a document from the company. While not required, this process is helpful in keeping everything streamlined and professional.
- Open a corporate bank account in Singapore with an institution that has full bank status.
- Sign up to contribute to the Central Provident Fund (CPF) at an insurance agency in Singapore before you hire employees. You will make CPF contributions each month on behalf of your workers.
Singapore Subsidiary Laws
As a subsidiary, the law requires you to apply online to set up your CPF contribution details. You’ll need your representative’s SingPass and your subsidiary’s Unique Entity Number (UEN). Approval will take around two or three working days.
Once you get approved, you’ll receive an email and welcome letter containing:
- A CPF Submission Number (CSN)
- Payment Advice Through Form CPF91
- An Application for Interbank GIRO Form
The CSN is particularly important. You are required by Singapore subsidiary laws to quote the CSN during any transactions with the CPF Board when paying your CPF contributions or corresponding with the board.
As of 2018, all local entities with a UEN must register for a Singapore Corporate Access (CorpPass) to access any of Singapore’s Government-to-Business (G2B) digital services. Subsidiaries with a UEN will continue to use a SingPass, or the Singapore Personal Access gateway, but any new local entities will use CorpPass.
Benefits of Setting up a Subsidiary
Setting up a Singapore subsidiary comes with numerous benefits. You can grow and operate your company beyond your US location while avoiding liability in Singapore.
Your parent company in the US will control the Singapore subsidiary location. Any compensation problems or litigation will need to go to the parent company and not the subsidiary. Therefore, the Singapore location decreases its liability by placing it on the parent company. The subsidiary can also operate under a greater degree of independence from the parent company by developing its own culture and company policies that align with Singapore’s corporate values.
What Do You Need to Set up a Subsidiary in Singapore?
Any time you decide to set up a subsidiary, you should prepare to invest time and money. You’ll need to learn every Singapore subsidiary law, make sure your company representatives feel well-versed on both the nation’s regulations and culture, and travel to Singapore frequently. While much of the process takes place online, you must find talent, talk to a local payroll company, fill out all government forms, and establish a designated location within the country.
You can also choose Singapore subsidiary outsourcing. Working with a global PEO simplifies the entire process and takes some of the liability off your shoulders. At Globalization Partners, we can shorten the Singapore subsidiary setup process from months to days. You can start operations sooner and relieve some of the stress by working with us.
We hire employees in Singapore on your behalf, which helps you develop a workforce without setting up a subsidiary. We also take the liability that would typically get placed on your US parent company. A PEO can save you money by preventing costly fines or shutdowns and can take care of any non-compliancy issues.
Contact us today to learn more about our team and how we can help you with Singapore subsidiary set up laws.