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Singapore Budget 2021

The Secret Ingredient of Singapore’s 2021 Budget Plan

Singapore budget is announced each year with the financial year starting from the 1st of April of every year to the 31st of March of the next calendar year. The budget normally includes revised government revenue and expenditure projections for the current year as well as a planned government revenue and expenditure for the coming financial year. Before announcing the budget; the minister of finance carries out consultation to help gather feedback for the next financial year’s budget.

The feedback process takes about two months and all the suggestions and views gathered gets submitted during the set period and are taken into consideration when designing the budget. Once the designing of the budget is done, it gets presented before the cabinet for approval. Just like the budget that people set aside for their own personal expenditures; Singapore budget is normally planned with the aim of enabling Singaporeans to spend wisely.

The measures that were announced in Singapore budget 2021 are meant to help the country press on with economic and workforce transformation while strengthening the social compact and building a future for all in a way that’s sustainable. While budget 2020 was tilted towards the delivery of emergency support in a broad-based way, budget 2021 focuses on accelerating structural adaptations. Last year, apart from the usual spending; the government also committed about S$100 billion through the five budgets to support Singaporeans and also help businesses to stay strong during the pandemic.

One of the secret ingredients of Singapore’s 2021 budget is the fact that it puts in place structural economic policies to help equip businesses and workers with deep and future-ready capabilities. In order to fund the budget, Singapore will draw from its past reserves for the second year in a row and the budget is expected to post a deficit of S$11 billion or an equivalent of 2.2 percent of gross domestic product (GDP). The budget is such a balanced one as it addresses the immediate needs by supporting some of the worst-hit sectors in a way that’s targeted.

The budget focuses on the environmental and fiscal perspective while still supporting the medium to long-term needs of digital transformation, sustainability and upskilling of workers. The key ingredient of Singapore budget 2021 is the push for transformation.

Transformation

The government outlined S$24 billion that’s to be spent over the next three years to help workers and companies emerge stronger in the push for transformation. The funds are designed to be used in building the ecosystem for innovation, digitalize businesses, create a vibrant business sector and strengthen the workforce. The new budget measures such as the emerging technology program and the digital leaders program further helps in strengthening the range of measures that companies can tap on for increased competitiveness and position for growth post Covid.

Large local enterprises

The government also set aside S$500 million to be in a local enterprises funding platform to be commercially managed. The platform is to invest in non-control equity and mezzanine debt of the selected LLEs which are committed to work with the fund manager in pursuit of the next phases of growth.

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Singapore budget 2021

Tax Changes Overview in Singapore Budget 2021

On February 19, 2021 the deputy prime minister and minister of finance, Mr. Heng Swee Keat unveiled Singapore budget 2021. Budget 2021 is quite broad based and structured in a way that helps embolden and restructure businesses as they seek new growth opportunities. In order to help businesses emerge stronger together; the government committed to building strong growth enablers that foster innovation spirit, and enterprise of the business communities with the aim of enhancing a range of capital to help transform and also scale businesses.

Some of the tax changes proposed in the budget are as below;

Extension of Budget 2020 Tax measures

Several tax measures and the non-tax ones were announced during budget 2020 to help mitigate the widespread financial impact of covid 19 on workers and businesses. Since there is still no visible end to the pandemic, specific sectors are still struggling from the effects of covid-19 and that has led to some of the relief measures being extended.

Enhanced carry-back relief scheme

Under the existing carry-back relief scheme, the unabsorbed capital allowances and trade losses for the current year could be carried back to the immediate year of assessment. In the budget for 2020, the carry-back relief scheme was expanded to create room for qualifying deductions for the year 2020 to be carried back up to the three immediate preceding years but it’s subject to conditions.

Option to accelerate tax write-off on plant and machinery acquiring costs

The option to accelerate write off of the plant and machinery acquiring costs will be extended to qualifying capital expenditure that’s incurred on the acquisition of plant and machinery in the financial period 2022. This move will help ease cash flow for businesses that have plans of purchasing new assets. Under the accelerated option, businesses are allowed to claim capital allowance of 75% of the cost incurred in the first year and 25% of qualifying cost in the second year. There is no deferment of capital allowance claim that’s allowed under these.

Option to accelerate the deduction for refurbishment and renovation expenses

The expenditure that’s incurred on refurbishment and renovation works that are related to business setting do not qualify for capital allowances. The taxpayers who incur renovation and refurbishment expenditure for the purpose of profession, business or trade should claim tax deduction on those costs for a period of three consecutive years. However, the claim is subject to an expenditure cap of S$300,000 for every relevant year. For the qualifying refurbishment and renovation costs that are incurred in the year 2021, taxpayers were given the option to claim the deduction within one year.

Goods and Services Tax

It was announced in the budget that the planned goods and services tax rate is to increase from 7% to 9% and this is to happen within the period 2022 – 2025. The timing for the increase of GST tax will be subject to the economic outlook. GST will be extended to the low-value goods which are imported either via post or air. And the non-digital imported B2C services.

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Singapore Budget 2021

Singapore Budget 2021 Commentary

Last year, Singapore’s economy got impacted by the worst recession on record, and in response; the minister for finance delivered an unprecedented 5 budgets of S$ 100 billion to help combat the Covid-19 pandemic. This year, the economy is forecast to grow at between 4% to 6% as much as the recovery is expected to be uneven as some of the sectors are likely to progress well with others still remaining under stress.

The measures taken with budget 2021 are designed to help keep Singaporean workers afloat and also enable them to think of new opportunities on how to thrive during these challenging times.

Here is a snapshot of the budget 2021 alongside a commentary of the changes;

Green Plan 2030

The minister for finance while announcing the budget touched on Singapore Green Plan 2030. This entails a plan to tackle climate crisis and the efforts to increase solar capacity while also engaging in research into other sources of renewable energy. The green infrastructure projects and the incentives are intended to help encourage wider adoption of low emission vehicles and all these are geared towards building a more sustainable future for the generations to come.

The title of the budget 2021 was Emerging Stronger Together and while budget 2021 provides an array of support that’s more targeted towards the hardest hit business sectors and workers as they continue with the struggle amid the pandemic. This focus is coupled with attention towards the future with regard to digital transformation and business innovation alongside strengthening efforts to tackle climate crisis and invest in the renewable energy sources.

Household Support Package

For the families that are still coping with uncertainties that came along as a result Covid-19; the minister of finance announced that S$900 million has been set aside for household support package. The amount also includes one-off cash payments for the lower to middle income earners. The minister also spoke of the measures that have been taken to help strengthen social safety.

The minister talked of the proposed GST rate that’s to be increased from 7% to 9% during the period 2022 – 2025 and this is likely to influence the economic outlook. The ministered confirmed that the S$6 billion assurance package that was announced last year would help many Singaporean households to be cushioned against the impact of GST increase when the time comes.

Covid Resilience Package

The minister of finance also announced an S$11 billion COVID-19 resilience package to help support the recovery process. This amount will primarily help with safeguarding public health, vaccinations, and continued support for the workers and the business sectors that are hardest hit. The temporary wage support is another key highlight of the budget as it helps many workers who are hardest hit to prevent bankruptcy which is likely to affect households deeply.

Keeping the current workers employed also has short-term and long-term benefits with the most immediate being prevention of further financial hardship as a result of the pandemic. A targeted measure such as the jobs support scheme that was announced through SGUnited Skills with an additional S$5.4 billion was allocated to help minimize the long-term effects for those who get displaced.

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Corporate Service provider Singapore

How to Leverage Business Growth by Engaging Corporate Service Providers in Singapore

Corporate service providers are companies that provide a range of professional services such as Auditing, accounting, incorporation of Company Services, Business Advisory services and more. Such services are quite vital for the growth and efficiency of businesses. Engaging corporate service providers in Singapore can help business gain insight on how to improve their business processes and realize growth.

Work smarter and not harder has become a common phrase that’s meant to address the lack of time, finances and resources that many experience in businesses. However, it becomes a challenge when translating the words to actionable strategies. One of the ways of working smart is by engaging corporate service providers in Singapore to handle tasks that are repetitive and require a level of expertise. Working with service providers greatly helps in ensuring that complex tax that are time consuming are given to those with the relevant expertise to handle them effectively.

You can leverage on business growth and get more done when you focus on more critical tasks as you delegate, outsource and even automate some repetitive tasks. Outsourcing professional tasks to corporate service providers such as Onestop CA Singapore helps in ensuring that your professional tasks are executed with experts that understand the statutory requirements and has the skills needed to execute the tasks effectively.

From customer satisfaction to observing compliance, all are directly related to delivery of high quality service. Corporate service providers in Singapore can take on tasks that your company cannot handle effectively as you might be lacking on the required skills and experience. When you outsource such tasks to corporate service providers, you end up with sufficient time that can be concentrated on performing important tasks. Outsourcing auditing and accounting tasks will provide you with access to a team of experts that are well versed with the services and that eliminates chances of committing costly mistakes.

Outsourcing professional services provides the company with the opportunity to improve the skills of their staff. If in case you outsource internal audit tasks then the firm engaged will have to check on the systems and internal controls if they are effective. If not, they will get to make recommendations on what’s ideal for the company to adopt. Engaging a CA expert for some internal work will definitely lead to skills transfer and that in turn has a way of impacting on your business growth.

Engaging a corporate service provider in Singapore makes it possible for a company to access to a range of services at one place. It then becomes possible for a company to benefit from the expertise and experience that the service providers have on a range of services. Businesses can then be able to develop core competencies without having to invest further on hiring more qualified staff. They can also refine their services and streamline the processes so as to ensure efficient business processes. Outsourcing professional tasks provide a company with access to top quality personnel that can be of great help to their organization in general.  

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How to Implement a Robust and Effective Internal Audit

Having sound internal controls is a vital element for every organization. A well designed and implemented internal audit can help a company to realize their objectives and also improve on their overall operational efficiency and effectiveness. Internal audit is such an important component of a business as it helps in ensuring optimal performance of a business management system. Such audits help with analyzing the system and also checking it so as to ensure that it meets performance standards and conformance. The key goal of internal audit is to help gather information about the effectiveness of the system.

Just like the name suggests, internal audit is mostly performed by a person from within the company. However, it’s ideal that the department be associated with another department that’s different from the one being audited. Working with a reputable audit firm in Singapore to oversee internal audit and carry out extensive external audit should be considered so as to ensure that the internal systems are effective.

Here are some of the things that should be given emphasis if effective internal audit is to be ensured.

Identify key areas that need improvement

The internal audit should be conducted in a way that effectively evaluates quality management system. The parties involved should be able to identify key areas that need improvement and work to ensure that the right measures are taken so as to ascertain improvement of those areas. Identifying the key areas that require improvement helps in ensuring that the internal audit process increases the functionality of the systems in place.

Taking time to identify the controls that should be tested on a periodic basis can be quite complex. However, internal controls should be undertaken with the aim of addressing three forms of control; detective, preventive and corrective controls. When determining the areas to test, focus should be on the detective controls. Detective controls identify areas where the preventive measures were not quite effective in preventing errors.

Internal Feedback

Part of the auditing process is to help with gathering input from the employees. These observations can be very insightful to the companies. As the internal audit gets conducted, employees within the company can be engaged to help with the process. The internal auditor can then get to learn the different aspects of the company and in turn become better placed to see the various parts of the company that make the entire process to flow well.

Preparation for external audit

Execution of internal audit helps with preparation for external audit. Engaging in internal audit allows a company to gain knowledge of the areas that needs improvement. Should the external auditors come up with more observations; the company can be in a position where they are well prepared to express the ideas on how the issues can be addressed.

Segregation of duties

Internal audit cannot be effectively implemented without taking into consideration the segregation of duties. Segregation of duties plays such a significant role in creating a good internal control environment. Part of the internal audit process should be focused towards reviewing the functions performed by each employee so as to identify if there are any overlaps in duties.

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Company secretary services

Company Secretary Services: Appointment, Role, and Responsibilities

The roles, responsibilities, and appointment of a company secretary largely depend on the type of the type and size of the business. For a small company, the company secretary may only be required to perform administrative roles while for a larger company; the company secretary services may be required to perform a range of tasks including ensuring legal compliance. According to Singapore Company law, every company is required to appoint a company secretary within six months of its registration.

The company secretary is responsible for a range of tasks such as ensuring company compliance with the relevant statutory requirements and regulations. The company secretary is also charged with keeping the board of directors informed of their stipulated legal responsibilities towards the company. The company law has a defined legal framework within which the company directors and secretary should operate.

Appointment

According to section 88 of the Companies Amendment Act, every company in Singapore is required to appoint a company secretary and should ensure that the company secretary has the requisite experience including both academic and professional qualifications. Working with a reputable firm in Singapore for the delivery of Company secretary services can help in ensuring that an individual with the right qualifications and experience is engaged for the work.

The company secretary must be able to meet the following requirements; must be a natural person and a resident of Singapore. The directors of a company when considering the opening of a company should ensure that the ideal candidate has the required level of experience.

Duties

There are specific duties of the company secretary that are vested in the company law. Here are some of the duties that a company secretary;

Maintenance of statutory registers: The firm engaged for delivery of company secretary services should ensure that statutory registers are well maintained. The registers of substantial shareholders, register of members and charges should be well maintained as required by the law.

Preparation of accounts: It’s the duty of a company secretary to ensure that the accounts of the company are well prepared as per the provisions of the law. Once the documents are prepared, the company secretary should be able to file these statements with the registrar of companies.

Filing of statutory forms: The company secretary is also responsible for the filing of returns and forms with the registrar within the specified time. The filing of forms and returns such as the annual returns return of the allotment shares and notice of appointment of a director are all responsibilities of a company secretary. Engaging a reputable firm for such company secretary services should be considered as they have a team of skilled professionals with the needed expertise.

Preparation of company minutes during meetings

It’s the duty of the company secretary to prepare minutes for the meetings which are considered as records to be maintained by the company as per the law. These minutes form a part of the records that a company has. Company secretary services continue to evolve and the responsibilities may change depending on the activities that a company is involved in.

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Budget 2021: How it’s tackling the Impact of Covid19

During the Covid-19 crisis, Singapore has incurred one of the largest overall budget deficits in its post-independence of S$64.9 billion which amounts to 13.9 percent of the GDP in the 2020 financial year. Budget 2021 while still remaining expansionary; also adds to an overall deficit of S$11 billion. The government has proposed to draw on the past reserves to fund the S$11 billion Covid-19 resilience package.

A total sum of $4.8 billion has been set aside as Covid-19 resilience package to help with public health, vaccination, and for the safe reopening measures. Another amount of S$5 billion has also been set aside to cater for continued support of businesses and workers. Out of this S$2.9 billion is to take care of the Jobs Support Scheme alongside S$700 million that’s to take care of the hardest hit tier 1 sectors such as aviation, tourism, aerospace and tier 2 sectors

Safeguarding Public Health

In order to continue with the efforts geared towards curbing the spread of coronavirus, the Finance Minister, Mr. Heng mentioned that S$4.8 billion package is to be dedicated towards safe-reopening and public health. It covers expanding nation-wide vaccination program, contact tracing system, maintaining existing precautionary measures, testing regime and safe-distancing requirements. Vaccination of people is vital and the Prime Minister urged those who are medically eligible to take the vaccine whenever their turn comes.

Support for the Hard Hit Sectors

Since the global travel isn’t likely to recover as many international borders remain closed; the government in this year’s budget has committed to providing S$870 million to help support the aviation sector. Towards the end of January; the total passenger movements at Changi Airport was only at 2 percent in comparison to what it was before Covid-19. The amount set aside for aviation industry is to sustain the sector and also help it upgrade its capabilities as they prepare for recovery.

According to a statement delivered by Singapore Airlines Chief Executive Officer; Goh Choon Phong; he reported that the budget measures will enable the company to effectively navigate the disruptions that have been caused by Covid-19 pandemic. The support is to help the aviation sector remain flexible enough so that they can seize opportunities that might arise when the international borders open.

SG United Jobs and Skills Package

An amount of S$5.4 billion has been allocated to the SGUnited Jobs and Skills Package. This allocation is in addition to the S$3 billion that’s channeled to various schemes that seek to create jobs and training opportunities for Singaporeans in 2020. Out of the S$5.4 billion, S$5.2 billion is to be set aside to cater for Jobs Growth Incentive which has been extended to run up to September 2021.

The scheme provides companies with salary support of up to one year from month to month in which a new Singaporean worker is hired. The older workers including those with disabilities and ex-offenders have been set apart for salary support of up to 1.5 years.

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5 Keys Areas Impacted by Singapore Budget 2021

As much as the GDP of Singapore shrank to 5.4% in 2020; the government has taken a bold approach and put measures in place that are meant to spur growth and cushion businesses and workers from the impact of the prevailing economic changes. Here are some of the five key areas impacted by budget 2021;

The Funding of Large Local Businesses for Global Scaling

Singapore government has talked of helping the large local enterprises to scale globally by providing S$500 as growth capital. The funding capital is to be co-invested by Temasek Holdings which will then be matched by the government’s funds on a one-to-one basis. An amount of S$1 billion has been made available for investing in the large businesses.

The new platform for funding comes as the changes taking place in the global economic space have made it harder for the large local enterprises to attract private equity players. The government previously was focusing on aiding small and medium sized enterprises (SMEs) that have annual revenues of up to S$100 million.

New Launchpad Innovation

In order to encourage companies and drive innovative ideas, the government of Singapore announced of investing in a corporate venture launch pad which will be useful for the larger businesses that intend to stir up start-up mindset within their organizations. The minister of finance also added that a cloud based digital bench will be created to for its open innovation platform to help businesses further in gaining access to digital solutions alongside funding for prototype and the deployment of the innovative ideas.

With businesses innovating, the minister foresaw a rise of intellectual property and the intangible assets that businesses may need to commercialize and also protect their businesses. The government in response plans to unveil the Singapore Intellectual Property Strategy 2030 which is aimed at not only supporting businesses towards supporting such properties but also is aimed at training skilled professionals in the respective fields.

Extension of GST to Imported Low-Value Goods

While the minister of finance said that goods and service tax will not increase from 7% to 9% in the year 2021 due to the prevailing economic situation; he added that the tax will be extended to the low value goods especially the items that are valued at up to S$400 on goods imported via air or post.  GST tax is designed to take effect from January 2023 onwards and is more likely to affect international purchases form eCommerce platforms.

GST will also affect the non-digital services for consumers such as counseling, fitness training and the tele-medicine services offered by overseas parties.

Adoption of Emerging Technologies

Singapore government is set to inject S$1 billion in the various sectors to help mature enterprises adapt well to the emerging technologies such as artificial intelligence, trust tech, and 5G. During the announcement for budget 2021, it was announced that the government will be launching a CTO-as-a-service initiative which is meant to provide businesses with access to digital solutions such as IT consultancies.

Support to sectors that are hardly hit

The government has taken drastic measures to support the sectors that have been badly hit by the covid-19 pandemics such as aviation, tourism, and aerospace in 2021. The government through budget 2021 is also committed to helping businesses in Singapore digitalize and also innovate as a way of building the country’s reputation as the global-Asia node.

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Company Secretary Services

3 Advantages of Outsourcing Company Secretary Services

The majority of companies not only in Singapore but the world over are opting to outsource company secretary services and this is mainly due to a number of reasons. Previously, most companies preferred handling important roles within the confines of an in-house team due to factors such as reliability, accessibility, accountability, and reasons related to preference. Such a move gave the company control over the entire process, however, that has so far changed due to the intricacy and the ever-changing roles of a company secretary.

Majority of companies are being incorporated without having a company secretary in place and that’s creating an immediate demand for company secretary services. The increased use of technology has made the company business processes to be streamlined in such a way that makes outsourcing of such tasks to be effective as the company still remains capable of monitoring the process and exercising control. Many companies are therefore entrusting corporate service providers with professional support tasks due to their experience, expertise, and efficiency.

Competitive Pricing

Outsourcing of company secretary services has been proven to be less costly when compared to hiring a fulltime in-house company secretary. Offshore companies that are considering incorporation of company in Singapore tend to prefer dealing with a reputable corporate service provider for company secretary services as that also provides them with access to a range of other vital services. Professional tasks can be quite time consuming and outsourcing helps with freeing up the in-house team some valuable time that can be concentrated to other tasks.

There is more control and efficiency that can be realized when vital tasks such as company secretary services are outsourced to be handled by experts. The company personnel will then be free to engage in other vital tasks while also having the confidence that matters pertaining statutory obligations and compliance are effectively handled.

Execution of Support Duties

Once you outsource company secretary services to a corporate service provider such as Onestop CA Singapore; you also gain access to a range of support services such as auditing, accounting, advisory services and such can have a huge impact on your company.

Ensures Compliance

Observation of statutory compliance is an area that many companies find to be challenging. Whether it’s tax-related matters, monthly returns, and other related compliance issues; working with a reputable firm for company secretary services will help in ensuring that compliance is observed. Failure to ensure compliance has led to many companies paying unnecessary and such can be avoided if the right corporate service provider is engaged.

Outsourcing of company secretary services to a great extent provides that additional assurance on compliance processes and also helps in addressing the lack of compliance skills that could be existing within an organization. Many small and mid-level companies also lack the capability to hire skilled staff that can handle such tasks on full-term basis. Working with a corporate service provider therefore helps in making the entire process seamless.

With a reputable corporate service provider, a company can effectively streamline their internal and external compliance effectively.

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Originally published by onestop-audit.com

Company Registration Process

Why Engage Corporate Service Provider in Singapore

Singapore is a business-friendly jurisdiction and working with a corporate service provider in Singapore helps with making the entrepreneurial journey less complex for many business people that intend to invest in the country. Outsourcing key professional tasks enable the business owners to focus more on the core work that has the potential of enhancing business growth. The ever-increasing demand by the investors and regulators for the highest standards of corporate governance and stringent compliance measures alongside a growing list of complex regulations is causing many businesses in Singapore to engage corporate service providers for the provision of a range of professional services.  

A corporate service provider in Singapore is a professional entity that consists of a team of experienced and knowledgeable professionals.  They help businesses through the provision of a range of support services such as company secretary services, auditing services, accounting and taxation services, company incorporation services, and more. The complexity of business regulations that companies are required to adhere to and the constantly changing requirements demand the engagement of experts for the provision of corporate services. Working with reputable corporate service providers such as Onestop CA Singapore helps with ensuring that all the professional services are delivered correctly and a high level of expertise observed.

Here are some of the reasons for engaging corporate service provider in Singapore;

Proper Governance Framework

It’s important that every company registered in Singapore ensures that a proper governance framework is put in place. The corporate service provider that’s engaged for such tasks should be able to offer company secretary services in Singapore as they have a team of qualified corporate administrators and chattered secretaries with the potential and required expertise needed to manage the day-to-day operations of a company as they also provide expert support to the board.

Peace of Mind

Working with corporate service providers in Singapore provide clients with the much-needed peace of mind as they get to work with corporate administrators and managers that have a clear understanding of the client’s needs and work to ensure that optimum service with tailored solutions that address the diverse organizational needs are delivered. When working with reputable corporate service providers such as Onestop CA Singapore to ensure that statutory and regulatory obligations and effectively handled; the clients can then focus on key tasks that enhance the growth of their businesses.

Access to a Pool of Experts

Working with corporate service providers helps a company with access to a pool of professionals with great expertise and experience needed to move a business forward. Clients can draw from such a team for the incorporation of company services, auditing and advisory services, and more. Working with such a dynamic team of professionals helps with ensuring that statutory and regulatory obligations are responsibly handled. When you engage a reputable corporate service provider such as Onestop CA, you get access to a team of professionals that have the required level of expertise to handle a range of activities statutory and regulatory obligations effectively.

Originally published by onestop-ca.com