Location

Singapore is situated at the southern tip of the Malaysian Peninsula. Strategically located along the major shipping and air routes of Asia, it is the major nerve centre for trade and investments in the region.
Spanning just over 622 sq km, Singapore though small, is undoubtedly an advanced and bustling economy. It thrives on an excellent infrastructure, highly educated labour force, political stability and an efficient business environment. Singapore is an ideal holding company and headquarters location and a gateway for foreign investments in to the emerging economies of Asia, such as China, India, Vietnam, Indonesia and Thailand.
Political Structure
The People’s Action Party, its single dominant ruling party since its independence in 1965, rules Singapore. There is no strong opposition party in Singapore. The Singapore Government vigilantly plans, manages and administers the country’s socio-economic development. Singapore is one of the world’s most politically stable and corruption-free countries.

Economy and Infrastructure

Singapore has an excellent infrastructure with state of the art communication facilities and road transport system. It operates busy and efficient air and seaports and is a free port with no customs and excise duties on most items. Singapore is also one of the leading international financial centres. Offshore investors are well served by representatives of most major international banks, financial institutions, investment management companies and accounting and legal firms.
The Singapore Government actively woos foreign investments with generous tax and financial incentives. This has successfully attracted numerous regional holding companies, corporate headquarters, business and service centres, group finance and treasury centres as well as investments in high tech industries, media and communications, shipping and financial services.

Population, Language and Culture

Singapore has a population of approximately 4.35 million people. More than 75% are Chinese with the remaining 25%, mainly Malays, Indians and others. The different races live together with mutual respect and in racial harmony. The work force is well educated and hardworking and there is a high level of managerial and technical expertise available.
The most commonly used official languages are English and to a lesser extent, Chinese, Malay and Tamil which are also official languages.

Exchange Control

None.

Type of Law

Common Law.

Principal Corporate Legislation

The Companies Act.
The Income Tax Act.

Taxation and Fees

Singapore resident companies are taxed on profits derived in Singapore, as well as on foreign soil, which are then remitted to Singapore. The corporate income tax rate since 2010 has been fixed at 17%. It is calculated on the basis of the company’s chargeable income i.e. taxable revenues less allowable expenses and other allowances.
As regards to the rate itself, while Singapore’s marginal rate is already the third lowest in the world, the effective tax payable comes out to even lower if one takes advantage of all the government incentives, subsidies and schemes.
For instance, through its enhanced Productivity and Innovation Credit (PIC) Scheme, the Singapore government has made it possible for a firm to not pay any Singapore corporate tax even if it earns as much as S$28 million annually.

Double Taxation Agreements

Singapore has an extensive investment protection agreement and double tax treaty network. This includes most countries in the Asia-Pacific Region and countries in Europe, Africa and the Middle East. These countries include China, Indonesia, Thailand, Malaysia, Philippines, Vietnam, India, Japan, Korea, Australia, New Zealand, South Africa, United Kingdom, Netherlands, Germany, Switzerland, Sweden, France, Belgium, Finland and the United Arab Emirates.
Singapore is also one of the very few countries to have a tax treaty with Taiwan. This explains the popularity of Singapore holding companies for Taiwanese investments in to China and the region.