Corporate tax minimization strategies in Singapore
Singapore is a very attractive tax minimization destination for foreign investors because of the business structures benefiting from tax exemptions it provides. Considering the taxation system in Singapore is also quite low and competitive compared to other Middle Eastern countries, foreign businessmen searching for the perfect location to set up a company and will find the city-state to be what they need. Among the most employed tax optimization solutions available in Singapore is the establishment of limited liability companies which benefit from numerous tax exemptions. Start-up companies are also fully exempt from taxation in Singapore during the first three years of activity. Also, Singapore does not apply any taxes on capital gains. Another solution to minimize taxes is employing individuals as consultants in Singapore.
Tax optimization solutions for Singapore tax residents
Individuals and companies registered for taxation in Singapore will benefit from several tax reductions. Considering the personal income tax in Singapore is progressive, residents may benefit from 0% tax rate if their income is below the 20,000 S$ threshold. This is one of the main reasons why foreign businessmen choose Singapore as their residence. Also, according to the Inland Revenue Authority in Singapore, any income earned abroad after January 1st, 2004 is not taxable. However, Singapore tax residents may also apply for tax reliefs and rebates on different types of incomes among which contributions for social security, among which:
- – professional trainings relief,
- – spouse and child relief,
- – foreign income relief,
- – contributions to the Supplementary Retirement Scheme.
Considering all reliefs are subject to certain conditions, you may ask the advice of our agents who are specialized in opening companies in Singapore in order to comply with all legal requirements when choosing your tax optimization solution.
Tax minimization options in Singapore
Our specialists in Singapore provide personalized accounting services among which tax optimization solutions for foreign businessmen. One of the most employed types of tax minimization solutions is to set up a trust in Singapore which will provide tax exemptions on the income generated by certain investments. Singapore limited liability companies with less than 20 shareholders and with one shareholder owning at least 10% of the ordinary shares in the company will also benefit from tax exemptions.
For detailed information about the most effective tax optimization solutions, please contact our representatives in Singapore. Our team can also help investors open a company in Singapore, by registering it with the responsible authority.