Company incorporation with EP for those who are already in Singapore and fearing job loss
We are all passing through unprecedented times. The corona virus has caused havoc worldwide. While in Singapore we have been well protected due to pragmatic government intervention, the situation is not good in other countries like India, Indonesia etc.
Economic fallout of covid is slowly becoming visible. Till now Singapore businesses were protected by government Job protection scheme. Clearly government support can not go on for all along. As a result we are seeing significant losses of jobs especially for foreigners in Singapore.
It is logical that the authorities will first look for preference to be given for available jobs to Singaporeans and PRs. Foreigners on Employment pass will not be preferred for new jobs as far as possible.
If you are in Singapore on employment pass and if your job is in danger then it may mean following things to you.
Many EP holders have stayed in Singapore for sufficiently long. Their family members have well integrated in the Singapore life. They do not really want to go back to home countries especially in this kind of times. Moreover even if they were to go back – there are no jobs or opportunities in their home country. Settling back will be a difficult option for them.
So do they have any sensible option?
The solution is to incorporate your own company and apply for your employment pass under the company. Every year hundreds of companies in Singapore are incorporated like this and promoters relocate to Singapore. If the employment pass is approved you can continue working for your company and stay in Singapore for the duration of EP approved. Additionally your dependents can stay in Singapore on dependent pass. Steps involved in this option are as follows;
We will go through your case and suggest you additional documents to be attached with your application. In general we recommend attaching a brief business plan and a cover letter. This strengthens your application chances.
This is an important point to note. When you apply for a job in the open market, as an EP holder you will be taking up a job which otherwise a local person might have got.
However when you are incorporating your own company and applying for an EP under it, you are in fact creating one new job for yourself (And not taking somebody else’s job), and if the business works well you might create few more jobs for other Singaporeans/ PRs also.
One of the main question is when should you execute this plan? If you wait too long then you may not have enough time to act. You may be left with only one month to manage all these activities.
So, in general, we recommend executing this plan as soon as possible. As mentioned below in FAQs, it, in general, may take 2-3 months to get approval for EP. So you do not want to leave it to the last moment and suffer the anxiety about the future.
As mentioned, on approval, you get in-principal approval of EP. That provides you peace of mind. Once IPA is received then things are more in your control. You will be able to execute the activation as per your own plans.
If the shareholding is taken in your name then it is public record and your current employer may come to know about it if they search. To avoid this you may consider putting your spouse / friends name as shareholder. However keep in mind where possible, using your name as shareholder is always recommended.
When EP is approved, and In principle letter is issued. This your existing employer will never come to know, as information about this new EP is not sent to current employer.
Once the In principle letter is approved, you have 6 month period to get EP issued. In case of valid reasons, we can apply for 1 time extension of 3 months. So technically, you have 9 months to decide on your next steps.
Even if you do not activate EP in this period, the company can continue with existing director / Shareholder. Employment Pass can be applied again in future and we can expect positive result as previous record of employment pass approval already exist.
It depends – if your spouse is equally qualified and with relevant work experience, you can consider doing so. However you need to understand you have to give your best shot here.
Company can continue its existence (albeit as a dormant company) for as long as you want. If everything becomes normal and as per your expectation then you can think of closing down the company.
No you can not be added as a director of the company at the time of incorporation as you are already holding employment pass issued by another company. So the company needs to be incorporated with nominee Director.
Over the year the position of various visas have changed, and what you see on various websites is the understanding they had at that point of time in past. However none of that really holds true now.
All applications are evaluated based on its merit, and in general holding, a specific % (or more or less) does not change the merit of the application in principle.
No you are not required to do so. MOM may ask maximum the proof of capital, which if you can show from your bank statement, then its enough.
No it does not pose the problem. Nominee Director is a general industry practice of which all authorities are aware. Also we cover additional points in the cover letter and the business plan that we attach.
Considering the current long processing times with MOM (3-4 weeks for EP) we expect this to be a total process of 2 months. In this we have factored in one additional information request from MOM.
The ministry of manpower Singapore decides approval of employment pass. Nobody can guarantee approval. However, we can take steps to improve the chances of a successful outcome.
There is no specific obligation to show a specific amount of profit or success in your company. Many startups in first few years in fact may make loss. So long as company is engaged in genuine economic activity its ok.
Our packages are comprehensive. The price covers everything required.
Our service team has many years of experience. we will guide and assist you throughout your engagement.
We take pride in the quality of services we provide. Check our testimonial section to see what our clients speak about us.
Our pricing is available on our website. There are no hidden costs.
No long term contract, no commitments. If you don’t like our services you are free to change anytime.
We are very straightforward with our approach. If something in your plan is not likely to work out we will be frank to tell you so.