Angel Investors in Singapore

  • Posted by admin
  • 07 May 2014
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Angel Investors is providing a new tax incentive for individuals who might be interested in setting up a new company in the Singapore region. Under the new tax deduction plan, somebody who undergoes the Singapore company registration process can receive a number of incentives to help stimulate their initial business dealings. This can greatly streamline and improve the Singapore Company set up process, making things easier and more profitable than ever.

The Tax Program at a Glance

The Singapore company registration incentive program applies to an approved Angel investor who puts forward at least $100,000 in a qualifying startup. Those who are approved will receive a tax deduction equal to half that amount after a two-year holding period. The cap for each year of assessment (YA) is a total of $500,000 with a maximum tax deduction of $250,000. That means that you will receive a minimum deduction of $50,000 for making the initial investment, with a maximum deduction offer of a quarter of a million dollars. This greatly improves the chances of your startup succeeding early on, since you will be recouping half of your initial investment after the two-year holding period ends.

Qualifying for the Incentive

There are a few qualifying factors for people who want to take advantage of the Singapore company registration program. First, the initial investment needs to be made at an individual level. This means that corporations, trusts, and other institutionalized funds do not qualify. Second, the investor needs to be able to show an ability to nurture investee companies. There are three ways to meet this criterion: be an experienced Angel investor with a good early-stage track record, be an experienced or serial entrepreneur with a strong entrepreneurial history, or be a senior management professional or executive with corporate senior management experience.

Conditions of the Scheme

To qualify for the Singapore company registration scheme, the investee company needs to be a Private Limited Company (PLC) incorporated in Singapore for less than three years and with no shared listed on a Singapore stock exchange. 50% of the total shaped capital cannot be held by more than 20 shareholders, and there must not be a shareholder who is a relative of the approved investor. The approved investor and any relatives must not hold more than 25% of the share or debt capital of the company. The company must operate in Singapore and not be involved in undesirable activities such as gambling or prostitution. All these conditions must be met on the date of the first investment.

Investment Conditions

At the start of the Singapore company registration process, the investor must have the “Approved Angel” status with Angel Investors in order to receive the tax incentive. The initial investment needs to be made within 12 months from the date that this status is bestowed. Any investments made during this period need to be for newly issued shared to raise fresh capital, newly issued preference shares, or a cash investment in newly issued redeemable/convertible/preference shares or convertible loans. Investors should only take advantage of once incentive program at a time, meaning that startups who are receiving the benefits for the SPRING SEEDS or BAF programs are not eligible for this incentive.

Other Items to Note

The two-year holding period mentioned above begins at the date of the transaction. The investor company must not be liquidated, merge, or acquired within that two-year holding period. Yearly reports by the investor who initiated the Singapore company registration may be required. Investors receive approval for a 12 month period and will need to renew their status on a yearly basis. All investments made under this startup agreement need to be made before March 31, 2015. Each applicant will be reviewed on an individual basis, and it’s important to note that all decisions are final.

Anybody who is interested in getting a good return on their investment should consider the Singapore company registration process. To apply, you will need an Angel Investors tax deduction scheme form, a resume or curriculum vitae, your investment track record, and any other relevant information. As long as you feel strongly enough in your business to believe that it will last at least two years, you can get thousands of dollars back thanks to this incentive.


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