High Net Worth Individuals, we are looking at you!

“Affluent”

“High Net Worth Individuals”

“Ultra-High Net Worth Individuals”

If you fall under those categories above, this article is for you! Steps to find out what exactly Singapore offers you.

Currently, there is an existing of 270 thousand “High Net Worth Individuals” in Singapore. “High Net Worth Individuals” are known to possess net worth greater than US$1 Million. That is an astonishing 4.5% of Millionaires living in Singapore. The figure is expected to grow to over 437 thousand by the end of 2025, marking a 65% increase in the number.

An article by the Business Times reads “The super-rich are choosing Singapore as the world’s safest haven”. To sum up this article, an exponential number of individuals have been moving and staying in Singapore, despite the pandemic.

Why is there a surge of number of Millionaires choosing to move to Singapore? Well, it is due to several reasons, which we will be discussing below.

Singapore tax system is favourable for foreigner who become Singapore tax resident. Below are some of the tax incentives:

These exemptions have been in place since June 1, 2003. The scope of tax exemptions related to foreign-sourced income has been increasing over the recent years.

According to the Global Passport Power Rank for 2021, which is a set of rankings issued by The Passport Index intended to measure the amount of mobility granted by a particular country’s passport, a Singapore passport ranks 2nd place, with access to 192 destinations without a prior visa. This makes a Singapore passport second only to Japan of 193 destinations, making it more powerful than the likes of Economic powerhouses like Germany, South Korea and even USA.

Advantages of owning a Singapore Passport includes:

Don’t these factors make Singapore highly attractive to you? Just imagine the situation below and see how it can relate to you:

Simple Calculation:

Let’s take John, a High-Net-Worth individual from Malaysia. John owns several properties in Southeast Asia, most notably in Malaysia, Indonesia and in Vietnam. His individual income tax rate is 30% which is the highest.

Let’s say he moves to Singapore and become a Singapore Tax resident as he stays more than 183 days, and his highest tax rate is 22%. This saves John 8% (30% – 22%) in terms of individual income tax, not to mention that Singapore does not tax capital gains.

Using simple calculations, let us take his income to be SGD 5,000,000. 8% tallies SGD 400,000 (TAX SAVING). If the HNW has made

$5,000,000 Income * 8% = $400,000

$10,000,000 Capital Gain * 8% = $800,000

Total Tax Saving = $1,200,000

Just imagine that. What you can be doing with $1,200,000

Surely, not all that glitters is gold. Below constitutes several difficulties a High-Net-Worth Individual may still face while living in Singapore

It has been increasingly difficult around the world to open a Bank Account. Since 1 January 2017, Singapore based Financial Institutions such as banks are required to:

Overseas HNW individual does not have a residency visa for them to identify or prove their local tax residency hence most of the times even though they have a lot of money, they cannot successfully open a Singapore Bank Account.

An average of 147 people migrate to Singapore every day. Permanent Residency status is required as a “First Step” to eventually get Singapore Citizenship.

However, the Singapore government has been clamping down on the number of Permanent Residents they allow these recent years. This can be attributed to a few factors, but are not limited to:

With that said, the government is not closing off the country to foreigners. Instead, they are more selective in approving their citizenship application with more factors to consider besides their personal wealth and investment. Under the former GIP program, a PR visa is easily granted if you invest $2 million.

Now comes the interesting part. Do look out for what we can do for you below.

Our Shared Services Solution will enable your business to employ local physical staff for multiple roles as below. Having physical presence in Singapore will contribute to your business tax substance and meet the current requirement for opening a company’s bank account

Let us break down the process for you.

Overseas Company A is to set up a Singapore company. They do not have any employees or lease agreement for their Singapore company. Overseas Company B is to set up a Singapore company whilst engaged to our Shared Services program which offers employing local staffs as well as has a signed tenancy agreement for the physical office.

Which company then, do you think will stand a higher possibility getting approved for a bank account? Company B will 100% be able to open a bank account.

After the company’s bank account is opened, we can help you to obtain an Employment Pass to live and work in Singapore. This implies that control and management is in Singapore which directly contributes to local tax residency

An employment pass is valid for 1-2 years, which is renewable. This allows you to work and live in Singapore and being able to travel without having to pay for entry visas. The biggest upside is, possessing an Employment Pass makes it much easier to apply for Permanent Residency in Singapore.

An alternative will also be the Entrepass . Being an Entrepass holder means that you have demonstrated the plan to set up an investment holding company for investment in different industries purpose.

With the above it demonstrates that you have the potential to contribute to the Singapore economy, hence increasing your chances of becoming a Singapore Permanent Resident.

An alternative besides operating a business is setting up a Foreign Trust in Singapore.

By setting up a Trust in Singapore entails the following benefits: