Why Singapore Is the Ideal Tax Haven
Singapore has attracted substantial foreign direct investment over the years. Due to its low personal and corporate ideal tax rates, the island city-state has become one of the most popular places for investors to park their money.
It’s one of Asia’s leading financial hubs—not just for tourism, but for money too. Read on to discover why Singapore is one of the best countries to set up an offshore company and an offshore bank account.
Industry-Specific Tax Exemptions
Industries such as foreign banks, global trading companies, qualifying offshore funds, and more are eligible for industry-specific tax exemptions.
Qualified offshore funders can enjoy tax exemptions for a specified income. This income is defined as profits, dividends, gains, and traditional investments (bonds, deposits, stocks) interest.
Tax Exemptions For Start-Ups
The effective corporate tax rate in Singapore is 17% for businesses earning an income of over $2 million. However, this rate could be decreased via the Inland Revenue Authority of Singapore (IRAS).
Start-up companies based in Singapore can leverage the zero tax exemption policy for the first $100,000 of their income for the first 3 consecutive years. Offshore incorporation is necessary to qualify for this tax exemption.
Privacy of Investors
All financial institutions are regulated by the Monetary Authority of Singapore (MAS). These institutions are required to exercise due diligence in order to prevent criminal activity like money laundering.
The Singaporean law maintains that financial institutions are to keep the records of individuals private. Their personal data is not to be provided to third-parties.
Stable Political System
There are more than 100 banks currently operating in Singapore. If an investor’s home country is experiencing an unsafe and unstable political climate, there’s reason to be concerned about that country’s banking system.
The reason many choose to park their wealth in Singapore is also because of the safety it offers for long-term financial asset storage.
Mikkel Thorup is an experienced coach for entrepreneurs and established business owners wanting to internationalize their business. From helping you decide if offshore incorporation is right for your business to introducing you to legal ways of avoiding unnecessary tax bill, a range of pressing yet controversial topics are discussed in detail.
For in-depth interviews with successful Expat Entrepreneurs on how to reduce your corporate tax bill, Subscribe to his weekly podcast at The Expat Money Show.
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