Start a Subsidiary Company in Singapore in 5 Easy Steps

Have you ever wondered why global giants such as Google, Facebook, and Tesla have set up operations in Singapore? It’s not just about the skyline or the tropical climate—it’s about business. Singapore is frequently listed among the top three easiest places to do business globally (World Bank). With a corporate tax rate of just 17%, 100% foreign ownership, and a stable economy, Singapore has become the go-to destination for companies looking to expand in Asia.

In 2023, Singapore attracted $17.2 billion in foreign direct investment (FDI), a clear sign of its investor-friendly environment. Whether you’re a small business looking to set up a presence in Asia or a multinational firm seeking a tax-efficient regional headquarters, setting up a subsidiary in Singapore offers strategic advantages.

In this guide, we’ll walk you through everything you need to know to successfully start a subsidiary company in Singapore—from requirements and registration steps to compliance and benefits.

What is a Singapore Subsidiary Company?

A subsidiary company in Singapore is a private limited company registered under the Companies Act. It is a separate legal entity from its parent company, which means the parent company’s responsibility is restricted to its ownership stake in the subsidiary. Foreign companies often prefer this structure as it allows them to conduct business in Singapore while enjoying the benefits of a locally incorporated entity.

Key Features of a Singapore Subsidiary Company:

• Limited Liability: The parent company’s liability is restricted to its investment in the subsidiary.
• 100% Foreign Ownership: Foreign companies can completely own a Singapore subsidiary.

• Separate Legal Entity: The subsidiary is distinct from the parent company and can enter into contracts, sue, and be sued in its own name.
• Tax Benefits: Singapore subsidiaries enjoy local tax benefits and incentives.

Requirements to Start a Subsidiary Company in Singapore

To start a subsidiary company in Singapore, you need to meet specific legal and administrative requirements.

These include:

• Company Name: The name needs to be approved by the Accounting and Corporate Regulatory Authority (ACRA) before incorporation.
• Minimum 1 Shareholder: The parent company can be the sole shareholder, or multiple shareholders can be involved.
• Resident Director: A minimum of one director needs to be a Singapore resident (citizen, permanent resident, or an Employment Pass holder).
• Company Secretary: A qualified company secretary in Singapore must be appointed within 6 months of registration.
• Paid-Up Capital: The minimum paid-up capital is SGD 1, though a higher amount may be required for specific business activities.
• Registered Address: A local Singapore address (not a P.O. Box) is required.

How to Register a Singapore Subsidiary Company?

The process of setting up a subsidiary in Singapore is straightforward and can be finished in a few steps:

Step 1: Name Reservation

• The company name must be unique and cannot be identical to existing companies.
• There shouldn’t be any restricted or objectionable words in the name.
• ACRA typically approves company names within a few hours to a day unless additional approval is required.

Step 2: Prepare Required Documents

• Parent company’s incorporation certificate and details
• Parent company’s Memorandum & Articles of Association (M&A)
• Details of the appointed directors and shareholders
• Proof of registered business address
• Identification documents of directors and shareholders

Step 3: Submit the Incorporation Application

• The application is submitted to ACRA via BizFile+, Singapore’s online business registration portal.
• Upon successful verification, the company is incorporated within 1-3 days.

Step 4: Receive Certificate of Incorporation

• ACRA issues an e-Certificate of Incorporation, confirming the subsidiary’s legal existence.
• The company will also receive a Unique Entity Number (UEN), which is required for all business transactions.

Step 5: Open a Corporate Bank Account

Most banks in Singapore require:

• Certificate of Incorporation
• Company’s business profile
• Resolution passed by directors to open the account
• Personal identification of authorized signatories

Leading banks include DBS, OCBC, UOB, HSBC, and Standard Chartered.

Read More: Best Banks in Singapore for Foreigners

Post-Registration Compliance Services in Singapore

Once your subsidiary is registered, compliance with Singapore’s regulatory framework is crucial.

Here are the key requirements:

1. Corporate Tax Compliance

• Singapore’s corporate tax rate is 17%.
• Startups receive tax exemptions on the first SGD 200,000 of chargeable income.

2. Filing Annual Returns

• Annual returns have to be filed with ACRA within 7 months of the financial year-end.
• Financial statements must be prepared in compliance with Singapore Financial Reporting Standards (SFRS).

3. Goods & Services Tax (GST) Registration

• Companies that make more than SGD 1 million a year are required to register for GST in Singapore.

4. Employment and Payroll Compliance

• Employees must be registered with the Central Provident Fund (CPF) if applicable.
• Monthly CPF contributions must be made for eligible employees.

Advantages of Establishing a Subsidiary in Singapore

1. Attractive Tax Benefits

Singapore follows a territorial tax system, meaning foreign-sourced income is not taxed unless remitted to Singapore.

Tax exemptions for new companies:

• 75% exemption on the first SGD 100,000 of taxable income for the first 3 years.
• 50% exemption on the next SGD 100,000.

2. Full Foreign Ownership

Unlike some jurisdictions, Singapore allows 100% foreign ownership of a subsidiary, giving full control to the parent company.

3. Strong Legal Framework

Singapore’s transparent legal system ensures strong intellectual property (IP) protection and contract enforcement.

4. Access to Global Markets

As a key financial hub, Singapore provides businesses access to ASEAN, China, India, and global markets.

5. Political and Economic Stability

• Singapore ranks as one of the world’s most stable and corporate-friendly economies.
• Singapore is frequently listed as one of the most convenient locations to do business by the World Bank.