According to the ACRA registry, there are more than 530,000 registered businesses in Singapore. Although COVID-19 has caused many health and economic challenges this year, the ACRA registered an average of 1312 new entities each day.
It is always a great thing when people decide to start their own business. While some do it to supplement their income, others do it to fulfil their passion and propel their careers. However, not all of these businesses were able to succeed. Nearly 80% of businesses in Singapore closed within 5 years of registration. As such, the beginning stages are crucial for a new business.
Here are 5 important steps that I wished I had taken to establish a robust foundation for my business. By learning from these steps and using them for your business, you can start your business in the best way possible.
1. Formed the business as a corporation right from the start
Like many people, I began by forming the business as a sole proprietorship. It was an obvious and easy choice. However, that put my personal assets at risk as there is no separation between the business entity and the owner. Business liabilities are also personal liabilities.
It was also harder to work out the taxation matters and pitch to potential investors. Little did I know that I would have overcome that hurdle easily by reaching out to firms that offer incorporation services in Singapore. The process is quick, thorough and affordable.
At Ackenting Group, they provide essential company incorporation services that have helped many companies set up successfully in Singapore. From SME business to multi-national corporations, their experts can provide you with a one-stop-shop for all of your business needs, and do so quickly and effectively. They are able to provide no delays in setting up your company and look to incorporate your company in under 1 hour with all of the required documents available.
2. Obtained Tax Identification Number (TIN)
Incorporation services firms will also advise you on how to set up all the corporate formalities such as establishing by-laws, a board of directors, and separating funds. They will also help you with matters of taxation. The company will have a separate Tax Identification Number (TIN), known as the Unique Entity Number (UEN).
Obtaining UEN sets you up for easy tax accountability, and you can apply for various tax benefits according to the eligibility of your small business.
3. Established a good accounting and bookkeeping system early
One of the most critical responsibilities of a small business owner is to be on top of your business finances at all times. This means you should meticulously track your transactions, income, expenditure, cash flow, and profit or loss.
A good accounting and bookkeeping system will help you stay on top of your finances. But if you are unfamiliar with the systems available, you may find it hard to pick one that best suits your business needs. Fortunately, you can reach out to firms that offer incorporation services as well as accounting services.
Ackenting Group is an award-winning mid-tier accounting firm with vast experience in helping many different companies incorporate successfully in Singapore. In addition, they provide accounting and bookkeeping services that are in compliance and accordance with the IRAS and ACRA. Their professional team of accountants have experience working in many different accounting requirements. They are able to work with your business to improve financial reporting, transparency, and meet your financial needs effectively.
4. Worked with professional consultants
In the early stages of my business, I hired a small staff team. As the company grew, there was a strain on my team as well as on myself. Sometimes, it caused errors in critical areas such as in bookkeeping, which resulted in penalties from the IRAS.
By working closely with professional consultants, I could have eliminated these pitfalls and be able to continue growing my company strategically. Outsourcing to accounting firms is a great way to receive professional expertise while avoiding expenses associated with hiring and maintaining employees.
5. Taken more interest in understanding business financials
It is essential to understand your financials intricately, beyond just simply having adequate knowledge of your business income and expenditure. You need a better understanding of the key financial metrics and statements, which can be made easier when you work with experienced accountants.
There are many benefits in understanding your business financials. For instance, you can better adjust your business spending, manage your cash flow, pitch for financial assistance, and have better profit projections.
If you require any assistance on accounting services, feel free to drop us an email at johnwoo@ag-singapore.com or contact us at +65-66358767. At Ackenting Group, we offer a complimentary 30 minutes online consultation for us to better understand your business requirements.
