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Funds from Foreign Parent Company

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vijay

Accountant

902 Points Posted on 06 February 2023

X Pvt Ltd is subsidiary of a Singapore Company Y Pte Ltd ( holds 99.99 % shares) and Y Pte Ltd is 100 % subsidiary of Z Pte Ltd ( also a Singapore Company )

X Pvt Ltd plans to start trading business ( Both Domestic & Export ) for which it needs huge funds which Z Pte Ltd is ready to provide. What will be the best way to transfer funds to X Pvt Ltd, can it be done only by way of loan or is there any other options available and also what will be the points to be considered while making such arrangement

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Quick Summary

X Pvt Ltd, a subsidiary of Singaporean companies, requires substantial funds for its new trading business. The parent company, Z Pte Ltd, is willing to provide these funds. This discussion explores the most effective methods for transferring these funds, considering whether a loan is the only option or if alternatives exist. It also highlights key factors to consider when structuring this financial arrangement.