Belize vs Singapore: Offshore Financial Centre Comparison
- Posted by admin
- 17 May 2019
- Articles, Company Secretarial
Belize and Singapore are both attractive countries for offshore and local business operations. When launching a business in any country, it’s important to consider the ease of doing business, the process of setting up a business, how to maintain corporate compliance and the quality of the workforce.
We’re going to compare the processes of setting up a business in Belize and Singapore so that you may make an informed decision when choosing a country for incorporation.
Ease of Doing Business in Belize and Singapore
When it comes to ease of doing business, Belize ranks 125 out of 190 economies, according to the World Bank. For 2019, the World Bank gave the country a score of 57.13 out of 100 for ease of doing business.
Part of the Latin America & Caribbean region, Belize falls under the “upper middle income” category and boasts a population of 374,681.
Singapore ranks second out of 190 economies, according to the World Bank, and has an “ease of doing business score” of 85.24 out of 100.
Part of the East Asia & Pacific region, Singapore falls under the “high income” category and has a population of 5.612 million.
The World Bank’s rankings and score systems take several factors into consideration, including:
- Starting a business
- Registering property
- Ease of obtaining construction permits
- Connecting electricity
- Securing credit
- Trading across borders
- Tax payments
- Resolving insolvency
- Enforcing contracts
Overall, Singapore ranks very highly in all of these categories. Generally, entrepreneurs and multi-national corporations have a much easier time setting up and running their operations in Singapore compared to Belize.
Setting Up a Company in Belize and Singapore
Launching a company in Belize requires significantly more steps compared to Singapore (9 vs. 2). Setting up a limited liability company does not require a minimum capital investment, and the entire procedure of launching a company takes approximately 43 days. The cost (% of income per capita) is 34.7.
The procedures involved in setting up a business include:
Name Search (1 day)
Entrepreneurs must travel to the capital city of Belmopan to visit the Companies’ Registry. The registry will provide a free computerized name search of all existing Belizean company names. Entrepreneurs can also request a name search via tax, telephone or email for a fee of BZD 50.
Register Company Statutes, Memorandum and Articles of Assocation (2 days)
All companies must register their statutes, memorandums, and articles of association at the Companies’ Registry.
There are several fees that must be paid during this stage of the process:
- BZD 500 for a certificate of compliance
- BZD 12 (each) for registering the memorandum, the statute, and the articles of association
- BZD 50 for registration
- BZD 10 for filing
- BZD 13 for registering the directors to act on behalf of the company
The fees are all paid directly at the Companies’ Registry.
Belize’s Companies Act only requires that each business have one director and one shareholder. If a company has one or more directors, each one must initially subscribe to at least one share. For practical purposes, each share will have a value of BZD 1. So, if a company has six directors, the minimum start-up capital will be BZD 6.
Documentation for this stage of the process must include:
- Company statutes
- Identification for all representatives and directors, if applicable
- Memorandum and articles of association
Application for a Trade License (1 day)
The next step is to apply for a trade license at the City Council. The application will prompt the City Council to send an inspector to the site of business. Typically, inspectors arrive the next day.
The application for a trade license will require the following documentation:
- Certificate of compliance provided by the Companies’ Registry
- Proof of residency
Receive Inspection from the City Council Inspector (20 days)
The city council inspector will inspect the business premises and submit his or her findings to the trade license board. The board is required by law to meet every three months, but due to the high volume of trade license applications, they typically meet every two weeks.
After deliberation, the entrepreneur will receive a determination and assessment notice, which is 25% of the inspector’s assessed annual rental income of the business premises.
Licenses are typically hand-delivered within two days of the board’s decision and the entrepreneur’s payment.
Pay for the Trade License (1 day)
The assessment notice is taken to the City Council, where the entrepreneur will pay 25% of the annual rental value of the business’s premises.
This step occurs simultaneously with the previous procedure.
Create a Company Seal (2 days)
The company must now create a company seal, which can be completed at a stationary store. Creating a seal can cost between BZD 50 and BZD 200, depending on whether the seal is embossed or rubber.
Register the Company for Business Tax (10 days)
The founders of the business must now register the company with the income tax authorities, which will require the certificate of compliance obtained earlier in the process. A fee of BZD 150 will be required.
It takes 1-2 weeks for a company to receive its tax number.
Operations can begin, but the company must withhold taxes. Failing to withhold payable taxes will result in interest and penalties.
Register the Company for General Sales Tax (17 days)
After registering for business tax, the next step is to register for general sales tax (GST) with the general services tax authorities. The certificate of compliance will be required for registration.
It takes a few weeks for the final registration to be confirmed.
Again, operations can begin, but all applicable taxes must be withheld in order to avoid interest and penalties. This step occurs simultaneously with the previous procedure.
Register Employees with the Social Security Board (2 days)
All employees must be registered with the social security authorities. Registration confirmation can take a few months. While operations can commence during this time, deductions must be taken.
This step occurs simultaneously with the previous procedure.
Setting Up a Company in Singapore
Compared to Belize, setting up a business in Singapore requires fewer steps and far less time. The cost of setting up a business, according to the World Bank, is just 0.4% of income per capita.
There are just two procedures that need to be completed, and it generally only takes 1.5 days to get a business up and running.
Online Registration with ACRA
Singapore makes it very easy to register a company, conduct a name search and obtain a tax number. The entire process takes place online and can be completed in less than one day. The cost to complete this first step is SGD 315 (SGD 15 for company name fee and SGD 300 for the registration fee).
The Accounting and Corporate Regulatory Authority (ACRA) is the regulator of business, corporate service providers and public accountants. Incorporation is done through an electronic filing system called Bizfile+.
Through the Bizfile+ platform, entrepreneurs can:
- Register for goods and services tax (GST)
- Reserve domain names
- Apply for a corporate bank account
- Activate a Customs Account
The process begins with a company name application, which is also completed on the Bizfile+ platform. The application is sent online at bizfile.gov.sg and will require a fee of SGD 15 for each approved company name.
If the name is available, the application can be approved within minutes of receiving payment. If the application needs to be referred to a separate agency for approval or review, the process can take between 14 days and 2 months.
Once the name is approved, the name will be reserved for 60 days and the entrepreneur can move on to registering the business.
It takes approximately 15 minutes to file the incorporation forms online, which will require a fee of SGD 300. The ACRA will issue a notice of incorporation through email to either the law firm or the firm hired to register the business. Newly incorporated businesses will receive a free copy of its Business Profile after successfully filing the incorporation forms and paying the incorporation fee.
The Bizfile+ platform also allows the business to register with the Inland Revenue Authority of Singapore (IRAS) for GST when its annual turnover exceeds SGD 1 million.
Sign Up for Employee Compensation Insurance
The final step in the business registration process is to sign up for employee compensation insurance, which is required under Section 23(1) of the Work Injury Compensation Act (WICA), Chapter 354, of Singapore.
Corporate Compliance Comparison
Corporate compliance in Belize is rather lax compared to other countries.
- There are no reporting requirements for local government.
- Businesses may appoint a secretary, but this is not a mandatory requirement.
- The company must appoint a licensed registered agent, and have a registered address and office in Belize.
- There is no statutory requirement for formal member meetings, and meetings may be held anywhere in the world.
- Accounting records should be maintained for five years. They may be kept anywhere in the world and in any currency.
- No annual return or financial statement filings are required.
Corporate Compliance in Singapore
Corporate compliance is a bit more complex in Singapore. All businesses must:
- Maintain a physical address as a registered address.
- Appoint a company secretary within 6 months of incorporation.
- Assign a resident director.
- Register to pay GST if earnings exceed SGD 1 million.
an auditor within 3 months. There are exemptions for this requirement, which
may apply if the company’s:
- Total assets are less than SGD 10 million.
- Workforce does not exceed 50 employees
- Annual revenue is less than SGD 10 million.
the following documents:
- Annual tax return
- Financial statements
- Financial statement audit
- Chargeable income
- ACRA filing of your annual return
All businesses must maintain all of the licenses they obtain as well as a hardcopy or digital register of controllers.
Availability of a Trained Workforce in Belize and Singapore
When launching a business in any country, one of the most important things to consider is the quality and availability of its workforce.
According to the Statistical Institute of Belize (SIB), Belize’s population was 377,968 in 2016. Approximately 162,264 members of the population were in the labor force.
Much of the labor force in Belize is unskilled. Nearly 52% of employed persons are engaged in either sales or other elementary work occupations.
Singapore, on the other hand, has a highly skilled workforce that is able to meet the demands of some of the world’s largest businesses.
The employment rate for people between ages 25 and 64 is 80.3%. Women account for 46% of the labor force, allowing for greater diversity.
According to data from the World Bank, it’s easier to start a business in Singapore than Belize. However, Belize has more lax regulations for businesses that are already in operation. Few reporting and filing requirements makes the country a favorite for offshore operations.