Business Licence Scope in Singapore Finding the Right Direction for Your Company

How to Choose the Right Business License Scope in Singapore A Guide for Entrepreneurs

Starting a business in Singapore is a dream for many entrepreneurs. As a key financial and commercial hub in Southeast Asia, Singapore attracts investors and business founders from around the globe with its stable environment, efficient services, open market system, and attractive tax policies.

However, for first-time entrepreneurs entering the Singapore market, selecting the appropriate scope of business activities under the business license is often the first major challenge they face. The licensing system is managed by the Accounting and Corporate Regulatory Authority ACRA, and when registering a company, businesses must clearly define their core business activities and list corresponding Standard Industry Classification SSIC codes on the business license. These codes not only determine the legality of business operations but also directly impact future tax reporting, industry regulation, and qualification applications.

1. The Importance of Defining the Business Scope

Selecting the correct business scope is the foundation of compliant business operations. According to ACRA regulations, companies must choose up to two primary business categories based on their main activities during the license application, along with up to two additional secondary categories. All selected categories must come from the official SSIC code list to ensure consistency and transparency.

Operating outside the registered scope may be considered illegal activity, potentially leading to penalties or revocation of the business license. Incorrectly defined scopes can also affect bank account applications, partner due diligence processes, and compliance reviews during future financing or listing procedures.

2. Choosing the Right Scope Based on Industry Trends

In recent years, as the digital economy has grown rapidly, Singapore has continuously updated its industry classification standards to accommodate emerging business models. For example, the 2025 SSIC update included new classifications related to artificial intelligence, blockchain technology, green energy, and telemedicine services-reflecting Singapore’s support for and guidance of new industries.

Take AI as an example. According to a report published by Lianhe Zaobao in October 2025, Singapore is actively promoting AI applications in healthcare, finance, and manufacturing, and plans to invest over S$1 billion in related infrastructure over the next five years. For companies aiming to operate in this field, selecting SSIC codes such as Development of Artificial Intelligence Solutions or Data Processing and Analysis Services can help gain policy support and market recognition.

The green economy is another growing area. With increasing global emphasis on sustainability, more companies are entering fields such as environmental technology, renewable energy, and carbon trading. Enterprise Singapore is actively supporting the development of green finance and green tech startups. Companies focusing on environmental protection, energy efficiency, or renewable energy should consider SSIC codes like Renewable Energy Technology Development or Environmental Consultancy Services to align with current industry trends.

3. Avoiding Common Mistakes in Scope Selection

In practice, many entrepreneurs tend to include a large number of seemingly relevant but unrelated business activities in their licenses just to be safe. While this may seem comprehensive, it often leads to unnecessary complications.

Firstly, overly broad scopes can require companies to provide irrelevant information during tax reporting or regulatory audits, increasing compliance costs. Secondly, certain regulated sectors-such as finance, healthcare, and education-require specific licenses. If a company includes these activities without obtaining the necessary approvals, it could face legal consequences.

Some entrepreneurs mistakenly believe that once the business scope is set, it cannot be changed. In fact, Singapore allows companies to modify their business scope after registration by submitting an amendment request to ACRA and updating the license accordingly. However, frequent changes can lead to administrative burdens. Therefore, entrepreneurs should carefully evaluate their business direction at the time of registration to minimize future modifications.

4. How to Select the Business Scope Scientifically

To make informed decisions about the business scope, entrepreneurs can follow these practical steps

1. Clarify Core Business Activities Identify the company's primary products or services and find the most suitable SSIC code. Use ACRA’s online industry classification search tool to ensure accuracy.

2. Plan for Future Growth Although you can select only two primary and two secondary business activities, prioritize broader SSIC codes that allow room for future expansion.

3. Benchmark Against Peers Review the business scopes of similar companies to understand common practices and avoid missing important categories.

4. Seek Professional Advice If unsure about which SSIC codes to choose, consult a certified public accountant, business consultant, or professional agency to ensure your selection is both compliant and strategically sound.

5. Conclusion

In Singapore’s highly regulated and competitive business environment, choosing the right business scope is more than just a formal requirement-it is a strategic decision that affects daily operations, compliance management, and long-term growth.

Entrepreneurs must approach the selection process thoughtfully, taking into account their own business characteristics, industry trends, and government policy directions. By making well-informed choices, they can lay a solid foundation for sustainable development and successful market positioning.