New year, new resolution, new company?

It is the best time to incorporate a new company. Here are some reasons why.

 

  1. This is the ideal time to set the company’s financial year to match the calendar year

    When a company is incorporated, you can select the company’s financial period. Typically, the first financial year would be 365 days from the date of incorporation. Ideally you want the company’s financial period to be the calendar year. Many things are pegged to the calendar year. For example, a company will need to send employees the IR8E indicating how much they were paid for that particular calendar year. If the company’s financial period does not match this period, a separate set of calculation may be needed. This is especially true if bonus and increments occured throughout that financial year.

  2. The Unique Entity Number is a smaller number

    For example, the first company to be incorporated in 2025 will have a UEN Number 202500001X with X being an alphabet. Smaller numbers are neater and easier to remember.

  3. The budget announcement is at the beginning of the year

    Typically, during the Singapore budget, there will be some incentives announced by the finance minister for companies. If you have a company that is incorporated at the beginning of the year, before the budget, the company will be ready to take advantage of any new announcements on any new incentives for companies.

  4. The start of the year is typically less hectic

    Starting a company requires some effort. You may need to spend time on setting things up. Most notably, setting up of bank accounts. All these administrative work should ideally be done at periods where business is less hectic. The start of the year, especially the first week of January and in and around Chinese New Year is less hectic. Businesses usually see less queries and less sales. This is the ideal time to get everything set up. Yes your business may be slow during this period. However, the banks are open and ready to serve businesses looking to open accounts, apply for business loans or other forms of financing.

  5. All subscriptions and renewals will be synchronised to the start of the calendar year

    The company may subscribe to cloud accounting platforms like Xero. The company may also build a website on Shopify. All these require a subscription. If all these subscriptions start at the end of the year, it is easy to remember that every start of the year, renewals are due. This in comparison with a situation where such subscriptions start on some random month of the year.

 

If you are looking to incorporate a company, the start of the year is most ideal. Enjoy the festivities. It is a new year ahead but also use this time to play for your new venture. Get the structure and set up right. If you need assistance with incorporating a company, you can contact the Raffles Corporate Services team at [email protected].

 

Yours sincerely,

The editorial team at Raffles Corporate Services