Buy an offshore IT company in Singapore
Singapore is quickly becoming a global information hub, so IT technology is in particular demand. According to a recent Reuters report, up to 500 new tech jobs are posted every week on job sites in the country. That means there are plenty of opportunities for IT companies in Singapore. To avoid starting a business from scratch and going through a lot of bureaucratic procedures, we recommend buying an offshore company in Singapore for IT.
Pros of Singapore for IT
Singapore is widely known as "Asia's emerging silicon valley." Last year alone, there were more than 4,000 tech startups operating here, and the number is expected to increase significantly in 2023.
This is because the government is working hard to turn Singapore into the world's first truly "smart nation," and to create a digital-oriented economy. Therefore, it offers many interesting incentives, opportunities, grants for technology start-ups.
Among the pluses for IT activities in Singapore are also worth mentioning:
- progressive information and technology infrastructure;
- friendly business ecosystem;
- stable political and economic situation;
- favorable business policy;
- attractive taxes;
- a skilled workforce;
- advanced digital trade;
- government grants to support technology start-ups;
- strict intellectual property protection laws to help protect their product.
Punggol Digital District is planned to open in Singapore in 2024. It is designed specifically for IT companies, which will be able to test digital and innovative solutions for everyday life here.
We can't talk about offshore Singapore in the literal sense of the word, because you have to pay taxes. Nevertheless, there are a number of benefits that the government has introduced to attract foreign investment and support local businesses:
- A flat corporate tax rate of 17%.
- If the income was earned abroad and not credited to Singapore banks, no tax is paid on it.
- No tax on dividends and capital gains.
- Singapore has signed a double taxation avoidance agreement with more than 80 countries around the world.
Startups during the first 3 years get 75% exemption from paying the first $100k of ordinary taxable income. If they earn another $100k, they get an additional 50% exemption.
Buying an IT company in Singapore: what you need to know
Singapore allows 100% foreign ownership, so there is no need to look for a local partner. IT companies are usually recommended to buy a closed company with limited liability or an open company.
When an investor selects the appropriate type of structure, agrees on all the details with the seller, a sale and purchase contract is prepared with the subsequent transfer of ownership. The deal is made at the notary, the process of registration takes a few days.
After signing the documents, the buyer receives:
- Certificate of Incorporation and Business Profile;
- Memorandum of Association and Articles of Association, which can only be amended (e.g. by changing the details of the shareholders);
- Corporate account;
- Legal address;
- Taxpayer identification number, GST number, etc.
When the transaction is completed, the owner can appoint new directors, a secretary, increase capital, change facilities, address. Within 14 days of the transaction, a notice must be sent to the Accounting & Corporate Regulatory Authority (ACRA). It must contain information about:
- change in ownership;
- a new or old registered office address;
- new officers;
- changes in the stock.
When the paperwork is complete, you can begin to work. The investor can hire local employees or invite foreigners. For non-residents, a work permit must first be taken.
How to buy an IT company in Singapore
To buy an offshore company in Singapore for IT 2023, contact IT-OFFSHORE specialists.