All companies in Singapore must be registered with the Accounting & Corporate Regulatory Authority (ACRA) and abide by the Companies Act. While there are five different business entities to choose from, the most common and flexible business entity that can be set up in Singapore is the Private Limited Company.
To start a business in Singapore, you need an easy guide on the company incorporation procedure. We, at Singapore Company Incorporation, can assist you in the entire incorporation process, which generally takes only a few hours if all the necessary documents and details are prepared well in advance.
What is a Private Limited Company?
A private limited company is limited by shares and is a separate legal entity from its shareholders. It is recognised as a taxable entity in its own right. As a result, shareholders of a Singapore private limited company are not liable for its debts and losses beyond their amount of share capital.
The key requirements to register a private limited company in Singapore are as follows:
- At least one shareholder (individual or corporate entity)
- One resident director
- One company secretary
- Initial paid-up share capital of at least S$1
- A physical Singapore office address
Documentary Requirements for Singapore Private Ltd Company Registration
So, the considerations and documents you will need for company incorporation in Singapore are:
Choosing this cleverly is important for brand-building. Try to include your business activities in the name itself for this purpose. It’s also advisable to check whether your chosen company name matches an available domain name, as a suitable web address is a must for increasing business these days. Whether to go for .sg, .com, .org or any other extensions will depend on your target market.
Description of business activities
Use the Singapore Standard Industrial Classification Code (SSIC) 2010 to select the business activities your company will be engaging in.
When a Singapore Private Limited Company is formed, it must issue one or more subscriber shares to its initial members.
It may increase capitalisation by issue of further shares. The issued share capital of the company is the total number of shares existing in the company multiplied by the nominal value of each share.
A Singapore company can be registered with a minimum paid up capital of S$1 (or its equivalent in any currency). Paid-up capital is essentially the portion of share that the company has issued and received payment for in full.
It’s very important to have a proper shareholders agreement in place to avoid future disputes. This agreement defines the relationship between shareholders and specifies their respective rights and obligations.
It’s always advisable to protect your interests and have “controlling rights” of the company if you are the main brain behind the idea.
Details of shareholders
At least one corporate or individual shareholding is required. A director and shareholder can be the same or different person. 100% local or foreign shareholding is also allowed. The Companies Act allows a maximum of 50 shareholders for a private limited company.
Details of directors
The company must have at least one director who is “ordinarily” resident in Singapore i.e. Singapore citizen, a Singapore permanent resident or a person who holds an Employment Pass/Entrepreneur Pass or a Dependant’s Pass with a residential address in Singapore.
During the process of incorporating in Singapore, a registered address is required. All official correspondences are sent to this address. The registered address must be a physical address and cannot be a P.O. Box.
Use of residential addresses is allowed for certain types of business.
Particulars of the Company Secretary
All private limited companies must appoint a Company Secretary within six months of incorporation. He or she must have the prerequisite domain knowledge and is responsible for ensuring all regulatory compliances. Most companies in Singapore outsource the mandatory company secretary requirement to company incorporation specialists.
Memorandum and Articles of Association (MAA)
The memorandum specifies the activities in which the company may engage in, whereas the Articles of Association specifies the rules governing the internal management of the company. Singapore Company Registrar provides a standard MAA document that is suitable for most instances.
Appoint an auditor
All Singapore incorporated companies must appoint an auditor within three months of incorporation unless the company is exempted from audit requirements.
To be exempted, the company must fulfill at least 2 of the following 3 criteria for the last 2 financial years:
- Total number of employees must not exceed 50
- Its annual turnover must not exceed S$10 million
- Its total assets must not exceed S$10 million
Once the private limited company is successfully incorporated, the soft copies of the following documents are issued:
Company business profile
The Singapore Company Registrar issues an email confirming the incorporation of the company. It includes the company’s Unique Entity Number (UEM), which is the standard identification number issued by the government to any entity registered in Singapore. You can also obtain a company business profile on payment of a small fee which contains the company name, registration number, incorporation date, business activities, paid-up capital, registered address, as well as details of the shareholders, directors, and the company secretary.
A hard copy of the certificate of incorporation can be purchased if required.
This certificate constitutes proof of share ownership and indicates shares allotted to each of the shareholders. It is the responsibility of the company secretary to issue this certificate.
First board resolution
This resolution is needed to make appointments of shareholders and directors in the company official.
Bank account opening resolution
A private limited company is a separate legal entity from its directors and shareholders; therefore it will need its own bank account. Thus, a resolution by the board of directors of the company sanctioning the opening of the account and specifying the signatories to the account is required.
Additionally, you may need the following to run a business in Singapore:
A company seal, if provided for in the company constitution, is a legal requirement for business entities in Singapore.
Along with the seal, a company stamp is another important item because it affirms the credibility of a company. It makes company documents official and more authentic. That’s why, all official company documents, apart from having the Unique Entity Number (UEN) and registered address of the company, must also have an official rubber stamp.
Finally, every Singapore company needs to fulfil few filing and compliance requirements post-incorporation:
Annual general meeting (AGM)
Every company must hold its AGM every calendar year, with its financial statements tabled at the AGM for shareholders’ approval.
Every company must file its annual returns within one month of its AGM date.
The deadline for filing a corporate income tax returns is November 30, every year. Documents to be submitted are audited or unaudited Reports and tax computations.
Fiscal year determination
Each company in Singapore has to determine its financial year end (FYE), which does not necessarily be December 31. But it’s advisable to keep the company’s FYE within 365 days in order to enjoy tax exemption for new start-up companies (75% tax exemption on the first S$100,000 of normal chargeable income for its first three consecutive years of operations).
Government Grants for Newly Incorporated Singapore Companies
Companies incorporated in Singapore can also take advantage of few government schemes to promote and grow their businesses. One example is the Innovation and Capability Voucher (ICV) scheme.
Under the ICV, companies can apply for vouchers each valued at $5,000 for the redemption of professional consultancy services, hardware and technical solutions. Eligibility conditions for ICV include a Singapore registered and physically present company, with at least 30 percent local shareholding, and group annual sales turnover of not more than S$100 million or group employment size of not more than 200 workers. It’s important to note that all purchases must be made only after the indicated items have been approved in the ICV application.
Opening a Singapore Corporate Bank Account
During company formation, be careful while choosing your corporate bank account as Singapore has an array of banking options available to private companies. The banking requirements, application procedure, and the time is taken for opening are also all different. Some banks may offer an initial waiver period of bank charges, for any basic banking procedures such as depositing and withdrawing cash or checking on the status of the account.
Generally, you will need the following to open the account: a resolution by the company’s board of directors sanctioning the opening, a copy of the certificate of incorporation, a copy of the business profile, a copy of the company’s MAA, copies of the passports (or Singapore national identification cards), and proof of residential addresses of the directors and ultimate beneficial owners.
Related Reading » Incorporation of a Company in Singapore
Incorporate a Singapore Private Limited Company quickly and easily
Singapore Company Incorporation is the leading force in company registration in Singapore. With a gamut of services including Work Visas & Relocation, Accounting & Taxation, Business Licenses, Company Secretary, and Trademark Registration, we are well-positioned to support your business.