There are a few people I know who run businesses that are not registered with the Accounting & Corporate Regulatory Authority (ACRA). Many of these businesses operate on an on-demand/ad-hoc or all-cash basis. The people who run them often don’t register because they don’t consider what they do to be a real business. They also are unaware of the legal requirement to register… or they think that registering is too troublesome, time-intensive, or difficult (luckily, it is none of these).
According to ACRA, any person who carries out a business for the purpose of profit or gain must register beforehand. There are, of course, some exceptions like taxi drivers, who instead must have a vocational license. But contrary to popular belief, running an online business is not exempted, and even blog shop owners are required to register. Under the new Business Names Registration Act (BNRA), those who carry out their business under their full name only might also be exempted.
What Can You Register Your Business As?
There are a few choices in business structures, with the simplest being sole proprietor. But how you choose to structure your business depends on the number of owners, their liabilities and responsibilities, the number of employees, and whether the business is private or public. There is no easy way to convert one entity structure to another, so you must choose carefully. The different structures and costs are listed below.
What are the Benefits of Registering Your Business / Incorporating Your Company?
Besides legal compliance and avoiding fines and penalties, there are 2 other very important reasons why I would recommend it even to those who fall under an exception – 1) legitimacy and 2) possible liability protection. A registered business appears more legit than one which has no ACRA records. Also, when you’re registered, you can bid for government tenders through GeBIZ, the government’s online quotations and tenders portal. Businesses that incorporate or form limited liability partnerships also have the additional liability protection, so if they get sued, the business entity bears the liability and not the individual.
How Long Does it Take to Register?
As one of the world’s easiest places to start and run a business, you can register or incorporate a business in Singapore in just minutes – and it’s a super easy online process (here). The entire application process took me about 20 minutes, and most of it was spent searching for an appropriate Singapore Standard Industrial Classification (SSIC) code. You can actually do this search beforehand to save you time during the application process.
The “gig economy” is growing, and some studies predict that within another 3 years, as much as 40% of the workforce will be freelancers. To prepare for this change, NTUC has recently added a freelancer and self-employed unit. With more people now working as freelancers, it becomes even more important to comply with the law and establish legitimacy. It may help set you apart from the ever increasing competition. Below are some SSIC codes that you might find helpful or interesting. And it answers one question you may have about this site, that is, do bloggers need to register?
For more info, please see one of the many “How-To” guides on the ACRA website.