Guide to Registration of Singapore Company
This page will shed light on how to establish your Singapore company. You will get all the information about how to register a company in Singapore, the procedure, and the duration required for doing so, and what you need to do after the company is incorporated.
CRUCIAL INFORMATION ABOUT ESTABLISHING A SINGAPORE COMPANY
Every Singapore company needs to be registered with the Accounting and Corporate Regulatory Authority or ACRA. The company will have to run under the rules and regulations laid-down by the Companies Act.
Most Commonly Established Type of Singapore Company
The Private Limited Company is the most commonly established type of business in Singapore.
A Private Limited Company (Pte Ltd) in Singapore is limited by shares and holds a different legal identity than its shareholders. It is considered as a separate taxable entity. Therefore, shareholders of a Pte Ltd company don’t stand liable for the company’s debts and losses that go beyond their share capital.
REQUIREMENTS FOR REGISTERING A SINGAPORE COMPANY
Registration for a Singapore company can be filed with the following minimal requirements:
- It must have at least one shareholder
- It must have at least one resident director
- It must have at least one company secretary
- It must have SGD 1 as its starting paid-up share capital
A Singapore company should have a registered office address in Singapore.
Singapore Company Formation
A Singapore company is formed once it’s registered under the Cap 50 of the Singapore Companies Act. It can start with just one member that could be a natural individual or a corporation. Usually, the members are called as “shareholder.”
Because the Pte Ltd company will be governed by the Companies Act, it will have to comply with the rules, regulations and laws laid down by government authorities including the ACRA and the IRAS, among others.
REGISTERING A PRIVATE LIMITED COMPANY: IMPORTANT POINTS TO CONSIDER
It is important that the proposed company name is approved by the ACRA before incorporation. The ACRA has the power to decline a proposed name for company incorporation in the following cases:
- It is the same as or similar to the name of an existing company
- It is objectionable
- It has similarities with established brand names and trademarks like Temasek and Coca Cola
Any natural person or a corporation can become a shareholder in the company through share purchase or share subscription. A company must have a minimum of 1 natural or 1 corporate shareholder. It is possible for a shareholder and director to be the same person or different persons. It is allowed to maintain 100% foreign or local shareholding. Under the Companies Act, it is allowed to have between 1 to 50 shareholders for a Pte Ltd company. Public records will carry the mandatory information about the shareholders.
A Singapore Private Limited Company should have a minimum of 1 director who should be an “Ordinary” resident of the country. In other terms, he/she should be a Permanent Resident, a Citizen or an individual holding an EntrePass or Employment Pass, or a Dependant’s Pass and must have a residence address in the country. There are no limitations on the number of extra foreign or local directors that a Pte Ltd company could appoint. A director should be an adult having completed the age of 18, and he/she shouldn’t be a convict in a criminal malpractice case in the past or be bankrupt. All particulars of the director(s) should have to be registered in the public records. As already mentioned, directors could also be shareholders and the opposite is also allowed.
Every Singapore Company has to appoint a proficient Company Secretary who is credited with the duty to ensure the company’s compliance with regulations. It is essential that the company secretary is a natural individual who is an “Ordinary” resident in the country. Under the Singapore Companies Act, it is important that the company secretary is appointed within 6 months of the company’s incorporation.
Share Capital or Paid-up Capital
A Singapore company will require a minimal paid-up capital of SGD 1 for registration. It can even be in another currency but with equivalent value. The minimal issued capital will be 1 share of par value. The law doesn’t allow “No Par Value” or “Bearer” shares. It is possible to increase the Share/Paid-up Capital after the company has been incorporated.
Registered Office Address
A Private Limited Company should have a registered office address where official documents and notices could be sent. This is again the address where the company will have to maintain its registers as required by the law. All Singapore registered companies must have a registered physical address, and it shouldn’t be a P.O. Box No. However, residential address can be used by some types of businesses.
Structure of Governance
The governance structure of a Singapore company and the relationship with its shareholders will be governed by the constitutional documents of the company. This includes the Memorandum of Association & the Articles of Association and the provisions of the Singapore Companies Act. Sometimes even the company members (in the case of JVs) enter into shareholding agreements between them for capturing certain important rights and duties with regard to how the company will be structured and run.
THE PROCESS, TIMELINE AND CRITERIA FOR INCORPORATING SINGAPORE COMPANY
The step by step process and timeline for establishing a Singapore company are as follows:
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Process and Timeline
SINGAPORE BANK ACCOUNT OPENING
After the incorporation of the company, it is possible to create a corporate bank account with an international or local bank that has its offices in Singapore. In certain cases, it is also allowed to open an account abroad.
Usually, the banks will require that the directors and signatories of the account are present physically in the country for signing the documents when opening the account. Some banks can however accept the condition of document signing at their overseas branch or in the presence of a Notary Public.
Certificate of Good Standing Proving Company Existence
The Certificate of Good Standing stands as evidence that a company is registered in Singapore and that it continues to be active on the corporate register of ACRA. This certificate is electronically signed by the Assistant Registrar of the ACRA, and it is offered only to companies. It will also carry the company name, the date of incorporation, its business activities and the status.
COMPLIANCE AND OTHER REQUIREMENTS AFTER REGISTRATION
Licensing and Permits
There are certain business activities that are regulated by respective government agencies in Singapore. In fact, the incorporation of a company will not make it liable to start its business activities unless it has been licensed or has received the permission of the relevant government agency or agencies. The following types of businesses are just few of the types that should essentially have license(s) or permit(s) from respective government authorities:
- Private schools
- Travel agencies
- Video firms
- Financial advisers
- Childcare centers
- Liquor distributors/retailers/wholesalers/importers
Registered Official Working Hours
It is mandatory to have a registered office address and that the office should remain open to public for at least 3 hours a day. These open hours should be during regular business hours and on weekdays.
The company’s all official documents including invoices, letterheads and billings among others must carry the registration number of the company as issued by the ACRA.
Any business activity that involves the import/export or transshipment of goods/services across the international border of Singapore will require that the company be registered with the Singapore Customs. This will result in the issue of the CR Number or the Custom Registration number. Any Singapore company that engages in trading activities will have to apply for a Custom Registration number.
Goods & Services Tax (GST) Registration
The GST is a type of tax applied on the import of goods into the country and supply of goods/services within Singapore. However, goods/services being exported out of the country are exempt from this taxation. The GST rate currently stands at 7%.
If a Singapore company has an annual taxable income of over SGD 1 million or if it is currently producing taxable supplies with an annual expected taxable income of over SGD 1 million, it will have to register for GST. It is required that the company register for GST within 30 days of being considered liable for this tax.
It is also possible to register voluntarily for GST. It is up to the Comptroller (IRAS) to determine whether to approve a voluntary application for GST or not. After approval, the company has to maintain its registration for a minimum of 2 years.
Registering for Central Provident Fund or CPF
The Central Provident Fund (CPF) is a mandatory pension fund scheme where both the employee and the employer need to contribute a certain percentage of the monthly income into this fund. The employer is required to contribute to the CPF account of every local employee who is a Permanent Resident or Citizen of Singapore and has a minimal monthly salary of SGD 50. The highest CPF contribution rate is 20% and 14.5% for employees and employer. It could be lower depending on a number of factors including the following:
- Age of the employee
- Status of permanent resident
Foreign employees are however not required to make or receive the CPF contribution.
WINDING UP A PRIVATE LIMITED COMPANY
A Singapore company continues to be in existence until it has been dissolved through another process. Usually, company dissolution takes place in the form of ‘Wind Up’. This process can be initiated voluntarily by company members through the passing of the relevant resolution. However, a Wind Up may also be processed after a Court passes an order against a petition filed by the company, a liquidator, a creditor, a judicial manager or a contributory of the company.
A liquidator is appointed during the process of winding-up. The liquidator performs the duty taking account of and realizing the company assets. The collected capital out of the company’s asset is first used for clearing all the debts. Any amount, if remaining, is distributed among the company shareholders.
After the conclusion of the winding up process, further steps involve dissolution of the company and de-registering it.
CONTINUAL STATUTORY COMPLIANCE FOR A SINGAPORE COMPANY
After the incorporation of your Singapore company, it is required to meet the statutory requirements laid down by the Inland Revenue Authority of Singapore (IRAS) and the Corporate Regulatory Authority (ACRA). Get more information by checking the Annual Filing Requirements.