Which is an ideal jurisdiction for company incorporation in Asia? Singapore and Hong Kong have been dominant players in the Asian region, vying for the position of “the best place to do business.” But the crucial questions are, which of these jurisdictions have an edge over the other? Is incorporating a business easier in Singapore or in Hong Kong?
Strategic location and attractive tax benefits make Singapore the most preferred location for the overseas companies to set up their business. Various options are – opening up a Branch Office, a Representative Office or a Subsidiary in Ang Mo Kio . The country also has liberal immigration policies. If the company wants to set up their regional head quarters in Singapore they are also provided with Financial Assistance.
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A key determinant for setting up a business in Ang Mo Kio is the tax regime in force. In this regard Singapore boast of being one of the lowest tax jurisdictions in the world. Detailed below is an overview of the tax system and Payroll Accounting in Singapore.
Tax jurisdiction Singapore: Taxes are levied on a territorial principle i.e. companies and individuals are taxed on Singapore sourced income. In addition, the Foreign sourced income (branch profits, dividends, service income, etc.) are taxed when it is remitted or deemed remitted into Singapore unless the income was already subjected to taxes in a jurisdiction with headline tax rates of at least 15%.
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Tax information exchange agreement (TIEA) is an agreement between parties to transfer domestic tax information. It possesses no benefit to private third party. In fact, the government is the only party getting the benefit. The existence of such an arrangement will affect financial secrecy. It is considered as an important feature for some offshore investors. Experts of offshore banking and investments would not suggest their clients to do business in a country with a TIEA attachment.
TIEA is implemented to avoid a harmful tax practice. According to Organization For The Economic Co-Operation and Development (OECD), the lack of effective exchange of information is one of the key criteria in determining harmful tax practices. It even has a working group aimed to develop a legal instrument that could be used to establish effective exchange of information. The Agreement represents the standard of effective exchange of information for the purposes of the OECD's initiative on harmful tax practices. The OECD even has developed a manual and tool-kit for automating the process of information exchange between countries. It also lists countries, which deemed to be unco-operative. Andorra, Liechtenstein, and Monaco listed by The OECD's Committee on Fiscal Affairs as unco-operative tax havens.
A recent act by the OECD was forcing tax haven characterized countries to favour for greater transparency and exchange of information. Singapore and Hong Kong was among the countries devoted to such and arrangements with OECD countries. Both of them were categorized as a tax haven country by offshore specialists.
For individuals this could means less privacy and little space to move. Tax haven is great place for an internet-based business. Own a monetized website, create an offshore account in a tax haven country, and you have a tax-free income. However, this strategy would soon be neglected, since the information and exchange agreement would be implemented and propagate rapidly. For your own convenience, offshore investment as a tax avoiding strategy should not be relied on. Contact a well-known CPA's or tax consultants for a better and legal tax minimizing strategy.
Useful Tips For Singapore Business Start Up
If you aspire to work in the corporate finance department of an organization, you are part of a team that is involved with collating data that form the solid basis for making capital investment decisions of a company. Some of its primary tasks include supplying figures that will support or oppose investment proposals. A corporate finance job entails management of company assets and liabilities, financial forecasting, inventory control, budgeting, and auditing.
The two key functions of corporate finance include:
- Accounting - this involves recording of the day-to-day transactions of the company. Its tasks include payroll, tracking of company expenses, computation of revenue and balancing of the company's accounting books.
- Finance - this is concerned with the management of the company's assets, liabilities, and investments. It is also responsible for the monitoring of the company's financial performance and analyzing its revenue and expenses in order to ensure that the company's capital is used in the most effective way possible.
Finance and accounting may assume different roles in an establishment, but they are geared towards a common goal which is to maximize the company's potentials for financial advancement.
Primary Requirements of Finance and Accounting Jobs:
Knack for Numbers
Finance and accounting professionals breathe and eat numbers everyday in their professional lives. You should be good in mathematics in order to become an effective member of the finance department.
Strong Analytical Skills
Jobs in finance involve forecasting, analysis, and problem solving. They require you to understand patterns of the company's expenses, debts, receivables, cash flow and profits. These are all represented by numbers. You need to put them together to produce a sound basis of the company's business decisions.
Attention to Details
This is highly necessary because it can help to optimize the company's performance in the management of its finances. The company relies on the numbers you provide as its basis for formulating business plans and decisions.
You should be able to spot errors, unusual costs, and unnecessary expenses. These are important things you can bring to the attention of top management for appropriate action.
A degree in finance or accounting is the basic requirement for a career in corporate finance. If you want to stand out in the profession, you may proceed to advanced studies.
A masters' degree in business administration or a certification in CPA or CFA will help to give you the best in a rewarding career. These will make you more attractive to companies and increase your chances for employment or promotion.
These are some of the essentials for getting a career in corporate finance. Have them and you will discover a world of business and corporate opportunities.