UK consulting firm structures tax-efficient ASEAN expansion.

Client profile

The client is a UK-based consulting firm specialising in software development and customisation solutions for its global customer base. With growing demand from companies across the ASEAN region, the firm aimed to establish a formal presence in Singapore, Vietnam, Indonesia and Thailand to better serve its expanding market. To achieve this, the client partnered with Acclime Singapore, which provided local expertise and end-to-end support throughout the expansion process.

The challenge

Before engaging Acclime, the client needed to determine a corporate structure that would ensure tax efficiency across multiple jurisdictions. The primary objectives were:

• Establishing a regional ownership structure suitable for operating entities in four ASEAN markets.
• Minimising tax exposure on operational profits.
• Ensuring that profit repatriation to the UK head office could be conducted in a tax-efficient manner.

The complexity of cross-border activities, varying tax regimes and local regulatory requirements required expert guidance to design the most advantageous structure.

Our approach

Acclime recommended establishing a regional holding company in Singapore, positioning it as the parent entity for newly incorporated subsidiaries in Indonesia, Thailand and Vietnam.

The proposed structure involved establishing a Singapore holding company that would also conduct consulting activities locally, allowing it to qualify as a tax resident under the Inland Revenue Authority of Singapore (IRAS). As a Singapore tax-resident entity, any dividends received from its subsidiaries would be exempt from tax. In addition, the structure leveraged Singapore’s network of double tax treaties: withholding tax on dividends paid from Indonesia and Thailand would be reduced to 10%, while Vietnam does not impose withholding tax on dividends paid to corporate shareholders.

This structure ensured seamless ownership alignment across the region while taking full advantage of Singapore’s competitive tax regime and treaty network.

Our solution

Following the client’s approval of the proposed structure, Acclime managed the end-to-end implementation across all four markets. In Singapore, Acclime incorporated a private limited company to serve as both the regional holding entity and a locally active consulting business, making sure it met the activity requirements needed to qualify as a Singapore tax resident under IRAS. With the holding company in place, Acclime’s in-country teams coordinated the incorporation of wholly owned subsidiaries in Indonesia, Thailand and Vietnam, handling local filings and liaising with relevant authorities in each jurisdiction.

Throughout the process, Acclime provided the client’s UK head office with documentation of the ownership structure, intercompany relationships and dividend flow mechanics. Acclime also advised on transfer pricing considerations and intercompany service agreements to keep the structure compliant across jurisdictions.

Key takeaway

The structure recommended by Acclime enabled the client to optimise tax efficiency across its ASEAN operations. Benefits included:

• Minimal tax friction on profits paid as dividends to the Singapore holding company.
• Tax-free receipt of dividends in Singapore.
• Flexible reinvestment options, as profits can be retained in Singapore without triggering additional tax liabilities in either Singapore or the UK.

This outcome provided the client with a platform for regional growth and long-term scalability.