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Setting Up a Singapore Company

Choosing a Name For Your Company

Every business needs a name to differentiate itself and to make it easy for others to find the business. The first step is to choose a suitable name and reserve this name with ACRA. Once the name application is approved, you can proceed to incorporate the company.

 
Type of Pte Ltd Company

If the company does not have any corporate shareholder (ie, no shareholder who is a company), and the company does not have more than 20 shareholders, the company will be an Exempt Private Company (EPC).

If otherwise, the company will be a normal Private Company Limited by Shares. This will be the case when there is a corporate shareholder.

The difference between an EPC and a normal Private Company lies in the annual filing requirements, which will be covered in the below.

 
Directors and Company Secretary

Next step will be to determine who are the company directors, company secretary and other key officers to be appointed to the company. For each individual, you will need to provide their personal identification details, contact information (telephone number and e-mail address) and residential addresses.

1. Director

A director is the person in charge of managing the affairs of the company. He/ she must make decisions objectively and in the best interests of the company. Every company must have at least 1 director who is locally resident in Singapore. Here are the basic requirements for a company director. He/ she  must be:

  • At least 18 years old;

  • Of full legal capacity;

  • A Singapore Citizen, Singapore Permanent Resident or EntrePass holder.

  • A director may also be an Employment Pass (EP) holder. However, a EP holder wishing to become the director of a local company must first get a Letter of Consent (LOC) from the Ministry of Manpower

  • Cannot be disqualified from acting as a director of a company e.g. an undischarged bankrupt.

2. Company Secretary

A company must appoint a secretary within 6 months from its incorporation date. A company secretary must be:

  • A natural person;

  • Locally resident in Singapore

The position of company secretary must not be left vacant for more than 6 months. The sole director of a company and the company secretary cannot be the same person.

3. Chief Executive Officer and/ or Managing Director

A company can choose to appoint a Chief Executive Officer (CEO) and Managing Director to manage and oversee all or part of the company’s business. It is not compulsory to appoint either CEO or Managing Director with ACRA.

4. Auditor

Every company must appoint an auditor within 3 months of incorporation, unless it is exempted from audit requirements under relevant sections of the Companies Act. For most new companies registered, it is likely the company is a "Small Company" and will not require to appoint an auditor to audit its financials unless it is required by the shareholders.

 

Find out more details on "Small Company" for Audit Exemption in this link.

 
 
Share Capital and Shareholders

1. Share Capital

You need to decide on the amount of issued share capital i.e. the total amount that shareholders have paid for their shares. The minimum issued capital must be at least $1. However, there is no minimum paid up capital required. Share capital is often commonly referred as the initial investment amount contributed by the shareholders in the company.

 

2. Shareholders

The company must have at least one shareholder. For each individual shareholder, you will need to provide the personal identification details, contact information (mobile number and e-mail address), and residential address. For each shareholder who is a company (ie. corporate shareholder), you will need to provide the corporate shareholder' business profile and details, contact information (mobile number and e-mail address) of the corporate representative, and registered address of the corporate shareholder.

Registered Office Address

A local registered office address is needed for all Singapore company. A registered office address is referred to the place where all communications and notices to the company are addressed to, and the place where the company’s register and records are kept. A registered office must be operational and accessible to the public during normal office hours, but need not be where the company conducts its activities (e.g. the registered office address may be in Tampines but the business operation may be carried out in Novena).

 
Company's Constitution

The constitution is a legal document that:

  • Describes the key characteristics of the company.

  • Contains the rules and regulations for its governance.

  • Describes how its operations will be carried out.

  • States the rights and responsibilities of the directors, shareholders and company secretary.

A copy of your company’s constitution is required to be submitted to ACRA for all new companies. If you do not know how to create a company's constitution, you may adopt the Model Constitution provided in the Companies' Act (Cap 50).

The shareholders will need to sign the company's constitution and a copy will be required to be kept at the registered office of the company. If there is any amendment/ alteration to the company's constitution subsequently, the shareholders will need hold a general meeting to pass a special resolution. The company will then have to submit a copy of the special resolution and a copy of the amended/ altered constitution to ACRA within 14 days from the date of passing the special resolution.

 
Financial Year End

After all the above considerations, next you need to decide on the first financial year end (FYE) of your new company. The FYE will determine when your corporate filings and taxes are due. Common choices by companies include 31 March, 30 June, 30 September or 31 December.

For tax purposes, it may be benefits to decide the first financial year to be the month preceding the company registration date in the subsequent year, e.g. company is registered on 10 August 2020, the first financial year end may be decided to be on 31 July 2021. In this scenario, the first financial year/ period will be from 10 August 2020 to 31 July 2021.

A company must notify ACRA of any subsequent change in FYE. A company cannot change its FYE without Registrar’s approval:

  • if the change in FYE will result in a financial year longer than 18 months; or 

  • if the FYE was changed within the last 5 years (from the last changed FYE)

 
What Does a Company needs to file to ACRA Yearly

The board of directors of a company is tasked discharging his/her fiduciary duties and statutory obligations under the Companies Act. On a yearly basis, the company is required to conduct and/or file the following:

1. Annual General Meeting

Companies, unless exempted, are required to hold an Annual General Meeting (AGM). An AGM is a mandatory annual meeting of shareholders. At the AGM, your company will present its financial statements (also known as "accounts") before the shareholders (also known as "members") so that they can raise any queries regarding the financial position of the company. All companies in Singapore are required to hold AGMs. Companies must hold an AGM within six months after your company’s financial year end.

2. Annual Return

All companies must file their annual return within 7 months after the closing of the financial year end. Under the Companies Act, all Singapore-incorporated companies are required to file annual returns with ACRA to ensure that the company’s information on ACRA’s register is up to date. The company must also submit the date of its annual general meeting (AGM) if it has held its AGM, as well as the company’s financial statements (if applicable). Company directors and/or officers may face enforcement action for failing to file their company’s annual return.

3. Register of Registrable Controllers

With effect from 31 March 2017, companies (unless exempted) are required to maintain beneficial ownership information in the form of a register of registrable controllers, and to make the information available to public agencies upon request. 

 

A Controller is defined as an individual or a legal entity that has a “significant interest” in or “significant control” over the company. An individual or a person who has interest in more than 25% shares or total voting power of the company, or the right to share more than 25% of the capital or profits of the company will be considered as a Controller of the Company.

An individual or a person who has significant control over a company, for example:

  • holds the right to appoint or remove directors who hold a majority of the voting rights at directors’ meetings;

  • holds more than 25% of the rights to vote on matters that are to be decided upon by a vote of the members of the company; or

  • exercises or has the right to exercise significant influence or control over the company.

will also be considered as a Controller of the company.

4. Changes to Company Information

All companies are required to update ACRA within 14 days of any changes to the company’s name, address and business activity, or any changes to the personal particulars of company officers and shareholders.

All companies must maintain electronic registers of shareholders, directors, secretaries, auditors and CEOs with ACRA. Companies are required to update ACRA within 14 days after changes in any officers appointments and any changes to share ownership.

 
Other Important Information

1. CorpPass

CorpPass is a corporate digital identity for businesses and other entities (such as non-profit organisations and associations) to transact with government agencies online. All companies are required to set up their CorpPass which otherwise there is no other available channel to transact with Singapore government agencies, e.g. IRAS

2. Unique Entity Number (UEN)

After incorporation, every new business will be issued a system-generated Unique Entity Number (UEN). Companies must use this UEN when transacting with government agencies.

 
Foreigners who wish to register a company in Singapore

Foreigners wishing to incorporate a local company in Singapore must do the following:

  • Engage the services of a registered filing agent (e.g. a law firm, accounting firm or corporate secretarial firm) to submit the online application.

  • Employ a director who meets the requirements described in the above section on Directors.

You may choose to reside outside Singapore after setting up your local company. However, if you wish to be present in Singapore to manage the company operations, you must seek approval from the Ministry of Manpower (MOM).

 

IRAS Tax Guide

Company Tax Rate

GST

Tax Deductible Expenses

Non-Deductible Expenses

Personal Tax Rate

Asia Corporate Advisory

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