Singapore versus Australia

Updated 10 months ago by Junie Zhu

Where does Australia stand compared to Singapore for doing business?

Australia's educated workforce, business-friendly laws and attractive tax incentives and government support definitely represent an attractive growth opportunity for companies looking to access Southeast Asia’s growth markets.

In this guide, we’ll cover an analysis of the benefits of doing business in Singapore and Australia.

The global ranking 

World Bank’s 2019 Ease of Doing Business Index

Singapore

Australia

Overall

2

18

Starting a business

3

7

Taxation

8

26

Cross-border trading

45

103

Contract enforcing

1

5

What does this mean? That if you’re looking to build a presence in Southeast Asia, you’ll find Singapore an easier and more business-friendly process compared to Australia. In comparison, take a look at the rankings of other popular hubs in Southeast Asia:

  • Hong Kong at #4
  • Malaysia #15
  • Thailand at #27
  • Indonesia at #73

Singapore is also an obvious choice if you have IP you’re bringing over with you – the World Economic Forum’s Global Competitiveness Report ranked Singapore as having the best IP protection in Asia (and ranked #3 globally).

Company registration

The table below shows the minimum requirements of company incorporation in both countries.

Minimum requirements for a private or proprietary company

Singapore

Australia

Directors

1 locally resident director

1 locally resident director

 

Shareholders

 

1 shareholder

 

1 shareholder

Other requirements

  • Local address
  • SG$1 paid-up capital
  • Company secretary
  • Local address
  • No minimum paid-up capital

Taxation

Singapore occupies 8th position against Australia’s 26th rank for ease of paying taxes. The table below demonstrates differences in the tax rates in two countries.

             Tax Types

               Singapore

         Australia

Income tax

Up to 22%

Up to 45%

Corporate tax

17%

30%

GST

7%

10%

Branch tax

17%

30%

Capital gain tax

No

30%

Withholding tax on dividends

No

30%

Withholding tax on interest

15%

10%

Grants, tax benefits for startups

Both countries offer funding, tax incentives, and facilities for targeted startups. 

Australia offers R&D tax incentives in the form of a 40% refund of development expenses to companies spending above $20,000 on research. A matching grant is offered for startups in the renewable energy sector. Major grants by the government include up to $20,000 as a business growth grant, incubator support grant between $5,000 and $500,000 for entrepreneurial support.

In Singapore, startups have access to many different grants and funding schemes from the Singapore Government and various programs.

Workforce

Both Australia and Singapore have multicultural, multilingual, and educated workforce. About 40% of Australians have tertiary education. In Singapore, which also has a 100% urban population, 47% of residents have degrees or diplomas. Here is a labor force comparison ranking based on the Global Competitive Index.

Institutions and Infrastructure

Australia and Singapore have very good institutional and infrastructure support. According to the World Bank report, Singapore leads the world in infrastructure while Australia is at 30th position. The city-state also scores over Australia in critical areas, such as:

  • The burden of government regulation
  • The efficiency of the legal framework
  • The future orientation of government
  • Quality and efficiency of transport and seaport services
  • ICT adoption and technological readiness

Summary

Australia has a vast market and huge natural resources while the city-state Singapore offers fast cross-border trading, easy access to amenities, and greater foreign market access.

Although Australia is often referred to as being strategically positioned on the doorstep to the Asia Pacific, if you are looking to take advantage of business-friendly laws, favourable tax policies and a location in the heart of the Southeast Asian market, then Singapore is likely to be a great choice for your business.


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