Unveiling Startup Costs in Singapore Do You Really Know?

The Real Cost of Starting a Business in Singapore What You Need to Know

In recent years, as the global business landscape continues to evolve, more entrepreneurs and investors are turning their attention to Southeast Asia. Among the region’s many options, Singapore stands out for its stable economy, strategic location, and world-class services-making it a top destination for international entrepreneurs looking to set up shop.

However, despite Singapore's consistently high rankings in global ease-of-doing-business indexes, the actual cost of launching a company there is often higher than outsiders might expect. This article explores the real financial burden of starting a business in Singapore, backed by recent reports and real-world data.

1. Registration Fees Low at First Glance, but Complexity Follows

Starting with the most basic expense-company registration fees-Singapore appears quite affordable. According to the Accounting and Corporate Regulatory Authority ACRA, registering a private limited company Pte Ltd costs just SGD 317 approximately RMB 1,600. However, this figure represents only the minimum entry-level fee.

Many startups need assistance from professional service providers such as accounting firms or corporate secretarial agencies, which can charge anywhere from a few hundred to over a thousand dollars for their services. Additional costs may also arise if the company needs to register trademarks, obtain business licenses, or apply for industry-specific permits.

2. Office Space Costs Expensive Downtown, Not So Cheap in the Suburbs

Choosing an office space significantly impacts operational expenses. According to a Q3 2025 report by Colliers, the average monthly rent for Grade A office buildings in Singapore ranges between SGD 8.5 and SGD 12 per square foot. For a small office of around 1,000 square feet, that translates to a minimum monthly rent of approximately SGD 8,500-an expensive proposition for new businesses.

To cut costs, many entrepreneurs opt for co-working spaces like WeWork or JustCo, which offer flexible pricing starting at around SGD 300 per month. However, these shared environments are better suited for freelancers or remote teams rather than companies requiring dedicated office setups.

3. Labor Costs High Efficiency Comes at a Price

Singapore boasts a highly skilled workforce, one of its major draws for foreign investment. But this comes with relatively high labor costs. As reported by the Ministry of Manpower in 2025, the average monthly salary for local employees exceeds SGD 6,000. While expatriate salaries may be slightly lower, employers must still meet minimum wage thresholds and cover additional taxes and insurance contributions.

Employers also need to sponsor work visas such as the Employment Pass EP or S Pass, which involve strict eligibility criteria and administrative costs. For example, the application fee for an EP is about SGD 75, with further renewal fees and compliance-related expenses adding up over time.

4. Tax Policies Attractive Incentives with Conditions

Singapore is well known for its favorable tax regime. The corporate income tax rate is 17%, with the first SGD 100,000 of annual profits exempt from tax. Additionally, various tax incentives exist for sectors such as technology, RD, and international trade.

However, qualifying for these benefits often requires meeting specific conditions. Programs like the Pioneer Certificate Incentive PCI or the Development and Expansion Incentive DEI typically require companies to demonstrate technological innovation or create significant employment opportunities. As a result, smaller businesses may find it difficult to qualify for the most generous tax breaks.

5. Other Hidden Costs Compliance, Auditing, and Day-to-Day Operations

Beyond the obvious expenses, several hidden costs often go unnoticed

Annual Audit Fees All Singapore-incorporated companies must undergo annual audits, which generally range from SGD 1,500 to SGD 5,000 depending on the company size.

Corporate Secretary Fees Legally required, a qualified company secretary typically costs between SGD 1,000 and SGD 3,000 annually.

Banking Charges Fees for account setup, transfers, and currency exchanges add up over time.

Marketing and Customer Acquisition Costs Especially in competitive industries like e-commerce and fintech, customer acquisition can easily exceed tens of thousands of dollars.

6. Conclusion

While Singapore offers numerous advantages for setting up a business, the true cost of doing so is far from cheap. From registration and office space to staffing and tax planning, each step demands careful budgeting and strategic decision-making.

For startups with limited capital, selecting the right service providers, optimizing budgets, and leveraging government support programs become critical. Recently, Singapore has rolled out initiatives to assist SMEs, including financing schemes and grants for digital transformation-offering fresh encouragement to aspiring entrepreneurs.

If you're considering launching a business in Singapore, thorough preparation and a clear understanding of all associated costs and risks are essential. Only then can you establish a strong foundation and achieve long-term success in this global business hub.