TaxSavvySG

Start-up tax exemption eligibility at incorporation

How do I set up my company to get the start-up tax exemption?

The situation

The start-up tax exemption applies for the first 3 YAs to companies incorporated and resident in Singapore with no more than 20 shareholders, at least one of whom is an individual holding 10% or more.

The law

  • Income Tax Act 1947, start-up tax exemption: First 3 YAs: 75% of first S$100,000 and 50% of next S$100,000 exempt, for qualifying new companies

What it means for you

Investment holding and property development companies are excluded. If all shares are held by a foreign company, the 10% individual test fails. Example: a founder holding 60% directly meets the test.

What to do

  1. Plan the shareholding at incorporation.
  2. Keep at least one individual with 10% or more.
  3. Keep shareholders at 20 or fewer.
  4. Check tax residence each year.

We can do this for youIncorporate a Singapore private limited company and complete first-month set-up: SGD 1,800

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