In addition to having a strong economy and low corporate tax rates, Singapore also has a well-developed digital and broadband infrastructure, many government initiatives supporting technology and innovation, and several opportunities for collaboration and innovation.
Guide to Singapore Company Registration for Online Businesses
Making a business plan
Every singapore company registration, whether it operates online or offline, needs a strong base. A strong business idea is the key component of this foundation. How well a business idea addresses the issues of your target market determines its viability. Therefore, in the planning stage of your online business, which is also referred to as the problem discovery phase, you must conduct in-depth primary and secondary market research as well as speak with potential customers to identify their pain points and how you can address them.
Creating a Minimum Viable Product (MVP)
After discovering a business concept that addresses the needs of your target market and for which they are willing to pay, you must develop a minimum viable product (MVP). An MVP is a version of your product or service that has the bare minimum of features or functionalities necessary to attract the interest of potential clients.
It’s the most basic and least expensive version of your final product, and its sole purpose is to generate enough revenue and customer feedback for you to keep going forward with your ultimate product. Here, the objective is to gain a deeper understanding of the issues that your clients face as well as possible fixes for these issues before you engage all of your resources in a hastily developed good or service.
Understanding Singapore’s Online Business Regulations
All internet content in Singapore, including that produced by e-commerce companies, is regarded as broadcast media content under Singaporean law. It is therefore governed by Singapore’s Broadcasting Act and the Singapore Broadcasting Authority (SBA).
You should still double-check to see if you need a license depending on the good or service you plan to sell to the public, even though certain online businesses (also known as “class licensees”) are automatically licensed and don’t need to apply for one to operate as an online business.
Furthermore, depending on the goods or services you sell, your eCommerce business may be subject to additional regulations. Therefore, you should get in touch with the appropriate authorities to find out if these regulations apply to your company. Several industries are subject to extra regulations, some of which are as follows:
- Online gambling service providers
- Online financial services and products
- Online sales of second-hand goods
- Online promotional activities
- Online advertising of certain products, such as medicines, alcohol, financial services, and others
It’s important to note that Singapore uses a territorial basis of taxation, which means that taxes are imposed on income that is earned in Singapore, derived there, or brought into the country from overseas.
Since online businesses don’t trade physical goods and services but instead rely on electronic, borderless transactions, it can be challenging to pinpoint exactly where their income is earned. However, understanding this is important because it affects your business taxes.
Incorporating the Business
Before starting business operations in Singapore, it is legally necessary for you to incorporate your company with the Accounting and Corporate Regulatory Authority (ACRA). You should register your eCommerce business as a web-based business. The limited liability company (LLC), limited liability partnership (LLP), general partnership, and sole proprietorship are the four most common business structures that are used while forming a company.
To register a web-based business in Singapore, you must meet the following requirements:
- A registered business address in Singapore
- An auditor for the company
- A unique company name
- Paid-up capital
- A statement outlining the business activities
- A company constitution
- The personal details of the partners, directors, and shareholders
- Personal identification documents of each company member
- At least one local resident director in Singapore, who can also be a shareholder
Building the Infrastructure of Your Online Business
To be successful as an online business, you must make sure that your digital infrastructure is of the greatest quality. You could lose thousands of dollars in sales if visitors to your website are unable to complete orders or are constantly experiencing errors. Thus, when starting your company, be sure to give careful thought to the following essential infrastructure:
- The design, hosting, security, and development of your website
- How you will deliver orders to customers
- Safely handling customer data
- Accepting orders and payments online
- Which online store system you should use
- Promoting and publicizing your website with effective SEO (search engine optimization) techniques
- IT infrastructure for your operations, website, and customer support
