Memo
The holding company: where a catalogue lives
A catalogue earns, gets licensed, and eventually sells as a unit. It does those things cleanest when a company owns it. This memo walks through the holding and operating structure, how royalties move between the two, and what substance in Singapore requires in practice.
Why the catalogue needs its own company
A catalogue is not one asset. It is a stack of them: masters, publishing rights, trademarks over the name, and the contracts that attach to each. Every contract gets signed by someone. If the person signs, every risk and tax consequence lands on the person. If a company signs, they land on the company.
That is the whole reason the entity exists. A company gives the catalogue a single legal owner of record, which every licensee, bank, and buyer wants to see. It limits liability, because a dispute in the touring business does not reach the masters. And it keeps the artist's personal tax affairs separate from the catalogue's, which matters once royalties start crossing borders.
Timing matters more than most artists expect. A deal signed before a company exists gets negotiated against the person. Retrofitting a catalogue into a company afterwards means assignments, new counterparty approvals, and in some cases renegotiating terms already agreed. In most structures the company should exist before the first significant contract goes out.
The shape: a holding company and operating companies
The common structure separates the assets from the activity. A holding company owns the catalogue: the masters, the publishing rights, the trademarks. One or more operating companies run the day-to-day: touring, merchandise, brand work, content. The operating side pays the holding company a license fee for the right to use the catalogue and the name.
The split earns its keep in three ways. It keeps the core assets out of reach of operating disputes. It gives an investor, lender, or buyer one clean balance sheet to value, the holding company and its IP, rather than a tangle of live contracts. And it lets the catalogue be sold or borrowed against without disturbing the operating business.
For a career at the start, a single company can be enough. The two-company shape pays for itself once money, staff, and risk grow past what one ledger can cleanly hold.
Where the money moves
Royalties follow ownership. Streaming income for the masters lands in the company that owns them, the holding company. Operating income, ticket sales, merchandise, brand fees, lands in the operating company. That split does not happen by accident; it happens because the contracts say which entity receives what.
The license fee between the two is where the structure gets tested. IRAS applies transfer pricing rules to deals between related companies, which in plain terms means the fee has to be a price two independent parties would agree on, and it has to be documented. A nominal fee will not do once real money moves, and an inflated one invites questions at filing time.
Each company needs its own bank account, and the people allowed to move money from each account should be set out in board resolutions, not left to habit. Signing authority is a governance document, not a banking detail.
Residency and substance
Singapore's headline corporate tax rate is 17%. Whether a company gets the benefits of being a Singapore company, including treaty relief on royalties coming in from other countries, depends on where it is managed. IRAS applies the control and management test: the company is resident in Singapore if its board actually makes the strategic decisions here.
A resident company can apply to IRAS for a Certificate of Residence, the document foreign licensees and tax authorities expect before they apply treaty rates. Substance is what backs that application. In practice it means a resident director, a local company secretary, a registered office, board meetings held in Singapore, and filings made on schedule. Substance is decisions made here, not money parked here.
This is the part of the structure that holds up under scrutiny. A holding company that collects royalties but decides nothing, and whose meetings happen wherever the manager happens to be, will struggle to claim the residency its paperwork says it has. The routines the corporate arm runs, secretarial filings, board records, compliance calendars, are what make the tax position real.
Singapore or offshore
Offshore incorporation has a place, and it is narrower than it used to be. Jurisdictions that once held IP without questions, the BVI among them, now require economic substance for IP holding companies, and an IP business is the hardest category to satisfy, because the business is just ownership of rights. A company that only collects royalties has to show real activity in the jurisdiction or it starts to look like a box.
For most artists, Singapore is the better base, because the structure matches how they actually work: the management, the deals, and the money move through Singapore. Offshore tends to be right when privacy is the dominant concern, since Singapore's corporate register is public, or when the artist's tax residence sits outside Singapore and the holding company needs to sit outside that system too. The decision is a set of specific facts, not a default.
What matters is that the structure gets built before the next deal defines it. Use our contact form.