Should I open a company branch in Singapore? (Expert's answer)

Looking to expand your business to Singapore? Setting up a branch office can be a strategic and effective move.

This solution allows foreign businesses to directly access the Singapore market while retaining full control over the operations of their branches. However, what preparations are needed for the implementation process, and what should you keep in mind before starting?

With the experience gained from working with experts from ACRA, GLA has collected important insights on branch registration, tax considerations, and operational challenges.

Based on expert advice, this article will guide you step by step, provide legal requirements and useful tips to help you successfully open a branch office in Singapore.

1. What is a branch office?

A branch office is an extension of a foreign company operating in Singapore.

Unlike a subsidiary, a branch is not a separate legal entity – meaning the parent company is fully responsible for its debts and obligations.

This model allows foreign companies to establish a presence, engage in business operations and generate revenue in Singapore while remaining tied to the headquarters.

Key features of a branch office include

• Operates under the same name as the parent company.
• Can carry out profit-making activities..
• Tax declaration for corporate activities (Do not receive tax incentives for companies like local companies).
• Require at least one representative to reside in Singapore for regulatory compliance.

2. Why do some foreign companies choose to register a branch instead of a subsidiary or representative office?

Choosing the right business structure in Singapore is important. Some companies choose a branch office because of its unique benefits. Reasons include:

3. How to effectively register your company's branch office in Singapore?

3.1. Main requirements for branch registration

If you decide to set up a branch office, it is a strategic move – but there are important requirements your company must meet. Specifically, branch opening requirements include:

• 1 shareholder is the parent company.
• 1 representative residing in Singapore.
• 1 registered office address in Singapore.

Foreign companies cannot register their own branches. Singapore Companies Act requires companies to work with a registered filing agent.

GLA can assist Businesses in this. As a leading corporate services provider in Singapore, cGLA assists Businesses with the entire process legally, quickly and professionally from A to Z. If the company's documents are ready, GLA can register the branch with ACRA within 1 day.

3.2. Step-by-step process for registering a branch in Singapore

Setting up a branch office is a simple process. Here's how to do it with the help of GLA's experts:

Step 1: Name the branch

The branch name must be the same as the parent company name. GLA will assist the company in applying for the name to ACRA (Singapore Companies Registration Authority). The approval process usually takes one day, unless further review is required.

Step 2: Prepare necessary documents

GLA will assist businesses in preparing the following documents:

• Certified copy of parent company's certificate of incorporation.
• Parent company's charter or memorandum.
• Information about the representative residing in Singapore.
• Resolution of the board of directors authorizing the establishment of a branch.

Step 3: Register with ACRA

Apply via BizFile+, ACRA's online portal. If everything is in order, approval will be within 24 hours.

Step 4: Set up registered office address

The branch must have a registered office address in Singapore. This will be where official notices will be received.

Step 5: Open a corporate bank account

After registration, GLA will assist the company to open a bank account in Singapore for the company branch to conduct domestic transactions.

4. How can your branch office comply with Singapore law after incorporation?

Compliance is key to avoiding penalties and maintaining goodwill. Typically, a branch office must meet two requirements:

4.1. Submit annual financial statements (audited)

Foreign companies are required to submit the financial statements of their parent company and their Singapore branch to ACRA each year. If the statements are not in English, the branch company must submit both the original and a translation.

Except for ACRA exempted companies and dormant companies, branches are required to submit audited financial statements.

In addition, the branch office must retain all financial and business records for at least five years.

4.2. Comply with tax obligations

Singapore branches are taxed on profits earned there, at a corporate tax rate of 17%. If the taxable turnover exceeds SGD 1 million/year, the branch will be required to register for GST (Goods and Services Tax).

5. How can GLA help your company to open a branch in Singapore?

Whatever your business goals are (Testing Singapore market potential, building a presence in Singapore, reaching out to potential customers, expanding into Southeast Asia), GLA can help you set up a company in Singapore and operate sustainably.
With over 10 years of experience and experience supporting hundreds of businesses, GLA will help businesses:

• Register a branch easily.
• Set up banking and regulatory compliance smoothly.
• Comply with tax obligations.
• Optimize operations for sustainable growth.

5. Frequently asked questions about registering a branch in Singapore

Highlights

• A branch in Singapore is an extension of a foreign company, not an independent legal entity, allowing the company to have full control over the company's operations.
• Benefits of opening a branch include direct market access and easier management than a subsidiary.
• The opening process for a branch office includes naming, preparing documents, registering with ACRA, establishing an address, and opening a bank account.
• GLA will support businesses with the entire process from registration to tax management and regulatory compliance when opening a company branch.