Can Dependent Pass Holder Start A Business In Singapore

A dependant pass (DP) is a pass for spouse and children of work pass holders (Employment Pass (EP), S Pass, PEP etc.) to relocate and live in Singapore together. Previously, they are also given the opportunity to work in Singapore via Letter of Consent (LOC). This automatically gives them the opportunity to also start up their own business without the need to be an Employment Pass holder.

However, those are no longer valid effective from 1st May, 2021. For those who wish to continue working in Singapore, the employing Company must apply a valid work pass for the employee.

For Dependant Pass (DP) holders who have the intention to start a business, there are two options available:

For existing Letter of Consent (LOC) Dependant Pass (DP) holders who are already business owners, you can maintain your letter of consent by employing local staff that earns at least SGD$1,400 and contribute CPF for the coming 3 months. This way, you are able to proceed with your LOC renewal application and sustain your business for the near future.

These recent changes signify MOM’s ongoing commitment to continue promoting the development of a strong Singaporean workforce as part of its Fair Consideration Framework.

In order for a Dependant Pass (DP) holder to qualify for LOC, you must meet the following conditions:

A letter of consent (LOC) does not have a minimum qualifying salary for its holder. However, it is crucial for the Company to prove that it has the sufficient fund, active business as well as support local hiring within the Company before they are able to proceed with LOC application.

The DP holder is not able to be a sole director within a Singapore registered Company until the LOC is granted to them. In order for them to initiate the LOC application will be:

Once MOM has approved the LOC, DP holder may now become the sole director and shareholder within the Company and continue growing the business.

For DP holders who already have existing LOC and runs a business, maintaining your LOC is still one of the available options. You do not necessarily need to acquire Employment Pass (EP) to continue running your business.

Example:

Angela is a dependant pass holder with a Letter of Consent attached. For the past 2 years, she has opened a hair salon Company based in Singapore. She is one of the directors as well as own 30% of shares within the Company.

In order for her to maintain holding a Letter of Consent, she must ensure the Company also hires local employee with a salary of at least SGD$1,400. Once the Company has contributed the CPF contribution for the local employee for at least 3 months, Angela may proceed to apply subsequent renewal of her LOC with MOM.

Steps to put in Letter of Consent (LOC) renewal application:

Traditionally, DP holders opted for LOC instead of Employment Pass because of the rigid requirements and they are unable to furnish most of the potential documentation needed to support the application.

If your business has been operational for a few months to a year while you were on LOC, you definitely have the chance to boost for an EP approval. As an active company, you would be able to provide these:

MOM can track the Company records such as tax filing and annual return filing via ACRA and IRAS directly. Then, since your Company has managed to secure and maintain contracts with your clients throughout the years, it will be a piece of cake to furnish them the proof of documentations needed.

DP holders in Singapore who wish to start a new business have two prominent advantages in applying for an EP:

Having had 13 years of experience helping foreign entrepreneurs obtain EPs in Singapore, we consolidated all our insights in our comprehensive articles. Check out our article on Employment Passes in Singapore.

In Paul Hype Page, we submit all Employment Pass applications electronically to Ministry of Manpower by our authorized in-house Employment agency. You may take a look at the Employment Pass Requirements to get the gist of it.

The standard timeline needed for MOM to assess the initial application submitted will be 1 to 3 weeks. Some might take longer, depending on the case.

By engaging with Paul Hype Page, the workflow will be as below:

Step 1: Paul Hype Page incorporates your company. We will be your short-term nominee director. Note: To incorporate your company in Singapore, you need to fulfil the 1 local director requirement.

Step 2: Your Employment Pass application.

Step 3: Upon successful EP approval, you can now fulfil the local director requirement. We will step down from the Nominee Director position immediately.

Step 4: Your company is now ready for operations.

There will be two scenarios on the documentations part.

If you’re currently holding an LOC to operate your business, then yes, you definitely have the chance.

MOM will be most likely to request additional documents to support your Employment Pass application. By engaging with Paul Hype Page team, we will ensure that the documents requested by MOM are well prepared according to the guideline and ensure it covers the potential red flags to smoothen the EP process.

MOM has tightened the requirements for Employment Passes and at the same time, decrease the quota for foreign expatriates.

That being said, Paul Hype Page has continuously been processing Employment Passes for clients, while maintaining high 85% success rates. This is largely contributed by our insight:

Overall, our mission has always been to find solutions for our clients. If MOM were to reject the application, we will discuss with MOM to understand further on the reason behind it and prepare the expected documentations to boost up the approval chance.