If you are setting up a Pvt Ltd. company in Singapore, It is compulsory to have at least one local Director. A lot of foreign entrepreneurs, who are planning to set up a base in the country, thus need to hire a nominee director.
Who are Nominee Directors?
The nominee directors are statutory directors serving as directors only on records in order to hide the identity of the non-resident owners. The nominee directors must be residents of Singapore. The nominee directors play the passive role of a company director and have no involvement in the daily activities of the company. They have no say in the operational, managerial, or financial matters of the company. They come into the scene only for signing official documents, reports, and agreements as agreed upon by the real directors.
For a non-resident businessman setting up a commercial house in Singapore, to hire a nominee director is an obligatory decision. And the decision comes with a pile of advantages. Below are some of the highpoints of hiring a nominee director. If you need more information, talk to the experts at https://www.singapore-company-registration.net/.
Buy Time and Privacy
It might take time for foreign businessmen to acquire legal rights to work in Singapore. They might also possibly intend to manage the businesses from their respective countries. But their new businesses in Singapore needn’t suffer. Until they get the employment pass, the real directors of the companies can hire nominee directors in Singapore to fulfill the statutory requirements.
Also, for that matter, if a businessman, for some reason, wants to keep his/her identity private, appointing a nominee director comes handy. While the official records would carry the name of the nominee director, the real director would retain the real control of the business.
Lesser Travel Exertion
Appointing a nominee director comes with a gamut of logistic benefits. It can be tasking for a non-resident businessman to move to and fro Singapore to get the paper works done for the new setup. Hiring a nominee director relieves the real director and the investors from the travel exertion. Be it completing the procedures for company and tax registrations, obtaining special licenses, acquiring special government affiliations, or opening bank accounts for the business, the nominee director handles it all. That way, the nominee director saves major travel expenses of the company.
Saving offshore business taxes
The profits made by a businessman from a foreign venture are subject to taxation by the government of his/her country of residence. When a businessman hires a nominee director for the offshore setup, all the records and paper works are deemed in the latter’s name. The real director can conveniently establish that the offshore business is administered independently by a director from that foreign country.
No Usurping Threat
One may question the safety of authorizing a nominee director. What if the nominee director plays foul and usurps the business? Possibilities of such threats are lean. The nominee director is deemed to sign a legal agreement with the beneficial owner, thoroughly underlining the terms of the former’s services. The nominee director can also be terminated at any time in writing.