Why register holding company in Singapore
What is holding company?
A holding company is a company that controls:
- The composition of the board of directors of another company (also known as the subsidiary company); or
- More than half of the voting power of the subsidiary company.
An ultimate holding company is a holding company that is not itself a subsidiary of any other company.
Purpose of Holding company?
Look at its exist perspertive, it main purpose of its incorporation is to own assets.
Holding company does not conduct any business activites.
Example of MNC setting holding based here is Dyson,Grab
Why holding company so popular ?
Separate Legal Entity Concept
- Its stand alone from its subsidiary which means its will not affected by liabities arise from its subsidiary companies .
Cost saving
- it can combine all resource from its subsidiary Example : Can combine warehouse storage services for all its subsidiary company
Financial Advantages
Company with holding company will normally give impression that their financial status is healthy as it was backup by big firm. Example if Temasek is your holding company, it will be easy for your company getting bank loan with better interest rate .
Unlimited potential investment
With the different range of business under holding company’s wing, you will able to attract more investment .
FAQ
What is different between Holding company and Parent company ?
Holding company stand alone whereas parent company is invoved with diary operation with control power.
Can holding company operate under different company name with its subsidiaries companies ?
Yes.
Can a subsidiary engage in different business activities from the holding company ?
Yes. This is the beauty holding company concept. It allow subsidiaries companies to have different activities among them .
What is the corporate tax rate for holding company ?
17% ( more detail about corporate tax )