Start a training or education business in Singapore

The business potential of the education sector in Singapore is attractive and lucrative. A growing number of foreign individuals and institutions have realized this and are trying to tap into the market by setting up private academic and non-academic schools, kindergartens/kindergartens, childcare centers, and other related services. In an effort to streamline the education industry and its various players, the Singapore government has established certain regulations and legal requirements for new entrants into the sector.

Overall, schools in Singapore offering private education fall into the following broad groups:

1. Childcare centers: This is a center that accommodates and supervises more than 5 children between the ages of 18 months and up to 7 years.

2. Preschools and Kindergartens: This is a school that provides a structured three-year preschool education, including a nursery, kindergarten 1 and kindergarten 2 for children ages 3 to 6.

3. Academic Schools: Academic private schools are those that offer structured, academic courses and formal education. Schools offering certificates, diplomas and degrees generally fall into the category of academic private schools. Examples of academic schools include:

4. Non-Academic Schools: Non-academic schools are those that primarily offer hands-on, real-world learning experiences. Examples of non-academic schools include:

Before applying for registration of your training education business, you will need to complete several administrative formalities:

The name of a school should denote a place of learning and should reflect the curriculum and type of courses that will be offered by the school (for example, a language school named “ABC Language School”).

Words such as “Singapore” or “National” suggest ownership and ties to the government. Therefore, private schools should not be named in the following manner: for example, “Singapore ABC School” or “National ABC School”.

This is especially true if the school is registered as a sole proprietorship or partnership with the Accounting & Corporate Regulatory Authority (ACRA), the name of the school and the name of the corresponding training education business must be identical.

The Department of Education (MOE) has the right to deny registration of any proposed school name that it deems inappropriate or misleading. Therefore, for clarification of a proposed school name, it is advisable to consult with the Private Schools Section (PSS) of the MOE prior to registration with ACRA.

There are some restrictions on the type of curriculum a private school can adopt. For example, private schools are not allowed to operate as full-fledged elementary or alternative high schools because public/university education requires considerable resources that private schools are not able to provide. Therefore, private schools are not considered equivalent to a public entity and should not use the word “University” in the title of their school programs.

Every academic private school must be administered by a management committee consisting of a minimum of 1 and a maximum of 9 members. The committee is responsible for ensuring that the provisions of the education law and the terms of the school’s constitution are met.

Members of the management committee should not be teachers or staff members employed by the school, unless they are also owners of the school. This is to avoid any conflict of interest between the employer and the employee in the decision making process.

Finally, one of the members of the private school’s management committee must be the school’s supervisor. If a school has only one member on its management committee, that person must also act as supervisor.

A private school must submit a constitution when applying for registration with the authorities.

Since the majority of the staff will be teachers, you will need to ensure that they have the necessary qualifications to teach the relevant courses. You will be required to clearly state the qualifications of the teaching staff in your advertising materials.
If your educational institute plans to offer government-subsidized training, you will need to comply with any additional requirements imposed by the relevant authorities.
In addition, since your staff will only be government employees, they will be subject to the Singapore Employment Act. The Act states that the employment contract must state:

In addition, a minimum of two teachers will be required if you choose a private company.
Finally, your staff can be composed of local and foreign employees. If the staff is foreign, they will need to have a Passport S Work Permit which is suitable for qualified employees with tertiary level education and relevant work experience.

You must find suitable premises. You can only use premises approved for educational activities by the Urban Redevelopment Authority (URA).

You must check with the landowner to make sure that the space you are planning to rent can be used for this purpose. In this regard, check whether the Urban Redevelopment Authority grants written permission for a “change of use” and whether the relevant authorities (such as the Housing & Development Board) approve or authorize the planned alterations or renovations to the school site.

At this point, you must have the mandatory certifications and licenses applicable to the type of educational institution you are establishing.

On the one hand, education institutions can benefit from a triple certification:

1. EduTrust Certification: EduTrust certification must be obtained before international students can enroll. Private educational institutions can obtain financial support and assistance for EduTrust certification through a new EduTrust Support Program (ESS). ESS offers a grant of up to S$26,500 to eligible institutes that wish to improve their capabilities.

2. Singapore Quality Class (SQC) Certification: SQC certifications not only help create a positive perception of your educational institution, but also help expedite the processing of student visa applications submitted by SQC certified institutions.

3. Council for Private Education Certifications under the Private Education Act: All academic private schools such as diploma and degree schools, prep schools, etc. are required to register.

On the other hand, the specific licenses required depend on the type of educational institution you plan to establish:

4. Registration: The main regulatory requirement for businesses involved in the education sector is that all private organizations or institutions providing education to 10 or more people (with the exception of non-academic schools) must register with either the Ministry of Education (MOE) or the Council for Private Education (CPE), depending on the type of educational institution. Registration with the MOE and CPE gives private schools the right to operate once they have met the legal requirements.

5. Building Permit: If you wish to set up a private education business in Singapore, you must apply for a building permit from the Urban Redevelopment Authority of Singapore (URA). In order to legally operate your educational institution in a premises, the URA will need to grant you a Class II license. Once you register your business with the URA, you can obtain the necessary licenses and permits.

6. Work: With respect to premises, if you wish to renovate your premises, you must obtain a special permit from the Building and Construction Authority of Singapore (BCA). The BCA is responsible for ensuring the quality control of a building. Therefore, the site of your future private education business will be thoroughly examined by the BCA to ensure that it is safe, secure and up to standard. In addition, you will also need to be certified by the BCA before legally occupying said space.

7. Selling food and music: Depending on how you plan to run your education business, you may need to obtain additional licenses and permits. For example, if you plan to sell food on your premises, you will need a license for that. If you want to play music, you will first need to obtain a music rights license.

However, setting up a non-academic school is generally easier and does not require obtaining a license from the Department of Education, setting up a management committee, etc.

Here is a summary table of the licenses required depending on the type of training education business you are opening:

Once the paperwork is complete, you will need to register your establishment with the Accounting and Business Regulatory Authority of Singapore.
The most appropriate legal entity is a private limited company registration.

Singaporean companies benefit from numerous business support programs and tax incentives created to support business incubation infrastructure and propel the nation towards a thriving startup ecosystem. Some of these programs were created to support specific industry sectors, including the education sector.

One such incentive is the Venture ForGood (VFG) grant. This grant is a funding program of the Singapore Centre for Social Enterprise (raiSE) to support social enterprises at various stages of their operations. New and existing social enterprises starting or expanding their operations can apply for up to S$300,000 in grants. The program is available for enterprises engaged in providing services in the areas of education, skills development, basic human needs, economic tools and services, and health or social welfare.

Of course, the business must be incorporated and registered as a member of raiSE at the time the grant is paid.

Finally, the raiSE grant is open to all new and existing local social enterprises that are registered or intend to register under the Companies Act or the Cooperative Societies Act.

Under Section 2(15) of the Income Tax Act 1961, the definition of “charitable purpose” includes the following:

Thus, any entity whose purpose is the “advancement of the general public welfare” (education), may qualify for a tax exemption under Section 11 or Section 10(23C) of the Act.

Further, entities with these purposes will continue to enjoy the exemption even if they are incidentally engaged in a business activity, subject, however, to the cumulative conditions stipulated in section 11(4A) or the seventh proviso of section 10(23C) which are as follows:

1. The business activity must be incidental to the achievement of the entity’s objectives

2. Separate books of account must be kept for this activity.