BANK ACCOUNT OPENING
Singapore VS Hong Kong
Both Singapore and Hong Kong are world-renowned business centres, attracting global investors with their extremely low tax rates and open business environment. Bank accounts have become one of the most important prerequisites for investors to make investment decisions and operate their businesses.
As financial centres, Singapore and Hong Kong are neck and neck. But the global economic situation is complicated, such as money laundering and fraud cases occur frequently, based on the prevention and control of financial risk, and the relevant international financial organizations, in recent years, the Hong Kong companies registry is easier but harder to open an bank account, even if the account being opened successfully or bank existing customers, also frequent gratuitously notified by bank closed the phenomenon of accounts, investors were upset. By contrast, opening a bank account in Singapore is relatively easy and successful, leading many investors to move to Singapore-registered companies and open accounts.
Kaizen is hereby illustrating a brief comparison of bank account opening in Singapore and Hong Long for our potential and current clients in order for them to make accurate investment decision.
- Common Reporting Standard (CRS) Information Exchange Agreement
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Hong Kong
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Since September 2018, Hong Kong has exchanged the information with 75 countries (regions). The first reporting period was from 1 July 2017 to 31 December 2017. Hong Kong has signed the mutual exchange agreement with 126 countries and regions, the CRS region information exchange protocol, including China, Japan, Korea, Singapore, United Kingdom Australia and other countries.
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Singapore
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Since 8 November 2016, when Singapore signed the mutual exchange agreement with Italy for the first time, it has signed CRS regional mutual exchange agreement with 65 countries and regions, including China, Japan, United Kingdom, Hong Kong, Italy and so on. The declaration period for the first exchange in Singapore was from 1 January 2017 to 31 December 2017.
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- Difficulty in Opening an Account
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Hong Kong
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Due to strengthen the international anti-money laundering policies and the presence of a large number of inactive accounts increase cost and operational risk management, in recent years, the Hong Kong bank accounts opening have been increasingly tightening, not only for the new company account more stringent, existing account also has the strict risk control, resulting in a large number of account was closed
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Singapore
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Major Banks in Singapore still maintain relatively loose policies and at the same time have strict and reasonable risk control, so the success rate of bank account opening in Singapore is higher than that in Hong Kong.
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- Convenience of Opening an Account
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Hong Kong
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Due to the current outbreak, in general, except for some Banks, the directors must visit the bank to open an account to witness, now because of the outbreak, most Banks in Hong Kong (such as HSBC and standard chartered bank and UOB, etc.) are accepted in the bank’s overseas branch to open an account to witness, some bank (DBS), for example, also provide the service that the video testimony to open an account.
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Singapore
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Three of Singapore’s local Banks, DBS Singapore, UOB And OCBC, can all open accounts by video witness.
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- Required Documents
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Hong Kong
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In addition to valid documents and business contracts, bank statements (if any), financial statements (if any), monthly statements of personal accounts of shareholders and directors, etc. If the company is a new company, the bank may also request the company to provide other evidence, such as the information of the affiliated company or the income proof of shareholders, etc.
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Singapore
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Just provide valid documents, company registration information (Bizfile) and relevant business contract. Singapore has no special requirements on materials of affiliates, but the due diligence on directors will be more in-depth.
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- Processing Time
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Hong Kong
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Approval will take about 4-8 weeks after submitting all the required documents and completing the account opening testimony. The bank’s account manager will inform the applicant if the account has been opened successfully.
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Singapore
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Compared with the number of high-risk and vulnerable countries in Hong Kong, Banks in Singapore are less in terms of audit scope. Although the due diligence of bank of Singapore’s account opening is very strict, it can be completed within one month from the submission to the initial approval to the final successful account opening.
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- Bank Account Opening Service Fee and Minimum Deposits
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Hong Kong
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There are different requirements for minimum deposits at different Banks, depending on the account opened. If the company opens a basic bank account, the minimum deposit may be as low as HK $50,000.
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Singapore
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There are different requirements for minimum deposits at different Banks. Take the three big local Banks, for example, minimum deposits can be as low as S $1,000.
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- Income from Offshore Operations
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Hong Kong
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Remitting offshore income into a Hong Kong bank account will not be a factor in whether a company pays tax in Hong Kong or not, nor will it have any effect on a company’s application for tax exemption on offshore profits.
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Singapore
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Singapore shall declare and pay corporate income tax for offshore business remitted to its domestic bank account, which shall be deemed as income derived from Singapore.
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To sum up, Singapore and Hong Kong have their own characteristics in opening bank accounts, so Singapore has the advantage at present. But Hong Kong’s proximity to mainland China, especially an hour’s drive from Guangzhou, Shenzhen and Zhuhai, remains the destination of choice for many Chinese investors.
It should be noted that the above comparison is mainly based on the current account opening policies of most Banks in Hong Kong and Singapore, and may be different for individual Banks. In addition, changes in the international situation and the epidemic situation have a great impact on the requirements of Banks, which may change their account opening policies at any time.
Kaizen will continue to pay close attention to the trend and changes of the opening policy in Singapore and Hong Kong, and advise investors to consult the firm for professional advice before making investment decisions.
KAIZEN Group is equipped with experienced and highly qualified professional accountants and attorneys. Kaizen has offices in Beijing, Shenzhen, Shanghai, Taipei, Singapore, New York and London.
Being a member of KAIZEN Group, KAIZEN (SG) PAC is a professional accounting firm registered in Singapore. KAIZEN SG provides business formation and registration in Singapore, we also provide business bank account opening, accounting, and bookkeeping, payroll, taxation, audit and assurance, merger and acquisition, immigration business and intellectual property services.
In addition, for those foreign investors who enter the Singapore at the very first time, we also provide supporting services in the areas of office and warehouse renting, purchasing business liability insurance, employee health insurance and life insurance, etc. Please call and talk to our professional consultants for details.
See also:
Singapore Bank Account Opening Remotely
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