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How to Set Up an Advertising Agency in Singapore

Published on March 31st, 2016 by in Blog

Setting up an advertising agency in Singapore is less complicated than you think. The basic procedures and rules will apply to advertising in the same manner as they do other entities. You’ll need to first start with the basics.

Incorporate Your Company

You must first form a business within Singapore, or apply as a foreign business entity. There are several different entity types to choose from, and the right one for you will depend on your business size.

The following are the main business types:

  • Limited Liability Company: An entity where you’ll reduce your legal liability if a legal matter arises. Your personal assets, will be protected from all business liabilities.
    • Private Limited Company: The most popular option. A Private Limited or Pte. Ltd. maintains less than 50 members and is a private company in most circumstances.
    • Public Limited Company: A public entity with 50 or more members that raise funds through the public. This is a larger entity and will not be the right option for smaller business.
  • General Partnership: A business consisting or more than 1 member. The downside of a general partnership is that owners are liable for their business’s liabilities.
  • Limited Partnership: Under a limited partnership, some members will not be required to conduct business activities pertaining to the company.
  • Limited Liability Partnership: The ideal option for a partnership. Under an LLP, the same protections from an LLC are given. An LLP is a common choice among smaller advertising agencies.

All foreign businesses must register their business in Singapore and maintain an office or subsidiary company within the country.

A business that consists of a single entity can be formed as a sole proprietorship. This is an entity that can be started without going through the hassles or expenses of forming a business, but you’ll be liable for all of your business’s actions. The major downfall of this entity type is that one lawsuit can cause you to go out of business, and none of your personal assets will be protected by law.

In most cases, opening a Private Limited Company or a Limited Liability Partnership is the right choice for an advertising agency. Note that a partnership will require you to have more than one owner when registering. If you’re the sole owner of your agency, a private limited company is the ideal choice.

When registering your business, you’ll need the appropriate Singapore Standard Industry Classification code: 73100. This is the current code in adherence to the Accounting and Corporate Regulatory Authority.

If you plan on manufacturing any signage of displays, you’ll need to apply under SSIC Code 32906 as well. This will require you to obtain various licenses and approvals.

An account or attorney will be able to help you through the business registration process.

Apply for the Proper Licenses

The world of advertising has changed greatly in the past few decades. Several mediums will be used in advertising from online avenues to billboards and pamphlets. Depending on your business’s operations, you may need one, a combination, or all of the licenses listed below.

Advertising License

A general advertising license may or may not be required. This license will be required if your company will be displaying outdoor advertisements of any type. If you’re using any outdoor signage, such as a billboard or sky signs, you’ll need to apply for an advertising license.

Internet Service & Content Provider License

Content providers are automatically licensed under the current Class License Scheme. As an advertising agency, you’ll need to abide by the regulations and rules set forth in the Class License Conditions and the Internet Code of Practice.

There are several other licenses which may or may not be required.

When dealing with licensing for any business in the country of Singapore, it’s best to discuss your licensing needs with accountants, lawyers or any other entity that specializes in helping entrepreneurs incorporate.

Considerations That May Be Needed

There are several employee-related considerations that may be required.

  • CPF Employer Registration: All new employers will need to register for a CPF Submission Number. This allows businesses to make CPF payments.
  • Work Permit: Any business that plans on employing a worker that is unskilled or semi-skilled (foreign) will need to apply for a work permit.

The premises that your business will operate from will need to be approved under a variety of different guidelines. You’ll need to consider the following:

  • Additions and Alterations of a Conservation Building: If the building has historical or architectural significance, you’ll need approval prior to adding onto the building or altering it.
  • Change of Use of Premises: You may or may not have to apply for a change of use of premises. This will occur if the area is rented or converted for your business purposes.

These are the basic concerns needed when discussing a business’s location. In the event that you’re having a new building constructed, you’ll need to have approval granted by the appropriate governing bodies.

Income Tax

There is a standard goods and services tax that must be followed at all times. A few common tax-related points are:

  • Corporate tax rates are 17%.
  • Individual tax rates are based on a sliding scale of 0 – 20%.
  • Goods and services are taxed at a rate of 7%.

The structure of your business will be the major deciding factor in how your business is taxed.  You’ll want to discuss all of your options with an accountant that can best help you determine the right tax structure for your advertising agency.

Once your business is registered, you’ll want to open up a corporate bank account.

Singapore has a thriving economy and a corporate tax rate that is very favorable for entrepreneurs. This guide will help any citizen of Singapore open an advertising agency. If the business will be owned by a foreigner or if one of the business’s members is not a citizen of Singapore, you’ll want to discuss your options with a lawyer. There are complex rules and regulations for any business in the country with a whole or partial foreign owner.

 
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