Interested Business Owners Can Register a Company in Singapore as Easy as A, B, C
Singapore always has good economic standing as well as stable politics. That is one of the reasons why more and more foreigners and locals are setting up shop. The business owner all over the world takes advantage of Singapore’s multi-pronged stability to start a business and enjoy its pro-business environment. To start a business in Singapore, individuals or a group of persons can register a company in Singapore. Singapore company registration is accessible and straightforward.
The Company Itself
Before setting up a company, one should already know that a company is a legal entity. It remains recognizable and separate from the company’s shareholders and directors. Under Singapore law, there are public and private companies. Public companies are the ones listed on the Singapore Exchange (SGX) with more than 50 shareholders. Private companies are the exact opposite of public companies. It is not listed on the SGX and has less than 50 shareholders as company owners. Only company owners a.k.a shareholders will appoint a director to manage the company. The Singapore Companies Act states that any person of local or foreign national age 18 and above can register a Singapore company.
The Pros and Cons
A company that aims to grow is relative to the business structure. Benefits for a private company includes the ease of raising capital for expansion and transferring ownership. Company owners are subjected to limited liability. This means the shareholders are not personally liable for any legal action taken against the company or its accumulated debts. The company is a legal entity on its own. However, owning a private company means having to deal with more compliance obligations which include filing annual returns and holding annual general meetings. Failure to comply will result in the Accounting and Corporate Regulatory Authority (ACRA) penalizing the company. It also takes up to five months to wind up a company and removing it from the register.
Pre-registering a Company
The following are required if you have decided to register a Singapore company.
- Director(s) of the company – A director of the company must at least be an ordinary resident in Singapore. It can be a Singapore citizen, a Singapore Permanent Resident or a person who has an EntrePass, Employment Pass or Dependant’s Pass. He or she must be 18 years old and above, not bankrupt and not convicted of any malpractice. There is no limit for appointed Singapore company directors and no specific requirement stating directors must be shareholders. Non-shareholders can be designated as director(s).
- Shareholders of the company – Shareholders of private limited companies can have a maximum of 50 shareholders. Shareholders can be a person or another company. Singapore companies allow for 100% ownership either by a local or foreign owner. After the Singapore company registration is completed, new shares can be issued. Existing shares can be transferred from one person to another.
- Company secretary – The Singapore Companies Act states that every company must appoint a company secretary within six months of registration. A qualified company secretary must be a person residing in Singapore. If a Singapore company has only one director and shareholder, this person cannot become the company secretary no matter how qualified they are. The company secretary office must at least have someone staffing the office at all times.
- Paid-up Capital & Corporate Tax – A Singapore company registration requires only S$1 of paid-up capital. This is also called a share capital, and it can be increased any time after the company is incorporated. The 17% corporate tax rate is among the lowest in the region. Registered Singapore companies also enjoy zero dividend taxes and no capital gains. Find out more about Singapore corporate tax.
- Registered Address – To register a Singapore company, it must have a local Singapore address. The address must be a physical address and cannot be a P.O. Box. If you wish to use a residential address as your business address, you have to seek approval from the respective authority. All registered Singapore companies must be operational and accessible to the public during office hours.
Now that you have all of the pre-requisites, it is time to prepare the documentation. The following information is a requirement by ACRA:
- Company Name
- Business activities brief description
- Shareholders details
- Director(s) details
- Registered address
- Company secretary’s details
- Company constitution
- Proposed financial year-end
The Registration Process
Next, we come to the registration process. Singapore company registration is under the authority of ACRA, and it is fully computerized. An applicant can register a business using the BizFile+ account. If the applicant does not have access to such, they may engage the services of a registered agent. The following are the steps involved to register a Singapore company.
- Pick a company name and address – You already have a company name in mind. That name would need to be approved by ACRA first. A search at BizFile+ is the quickest way to find out if the name is taken or not. The intended name should not infringe any trademarks, is not obscene and not similar to existing companies.
- Prepare the company’s constitution & shareholder agreement – A company constitution is the same as Memorandum and Articles of Association. It is now known as a company constitution, and it must contain everything about the company. This legal document must be submitted to ACRA and commonly reviewed by lawyers. A shareholder agreement complements the company’s constitution and ensures the smooth management of the company.
- Complete registration on BizFile+ – Now that you have everything ready, you can fill in all details into the BizFile+. There is a registration fee of S$315, and once it is paid, the company will be set up in less than 20 minutes.
Once the registration process is completed, ACRA will issue several documentations such as Certificate of Incorporation via email. The email version is accepted and treated as the official certificate of incorporation in Singapore. Business owners can also download the company profile after requesting for it on BizFile+. These two digital documents are sufficient for all legal, contractual purposes in Singapore. So, worry not, and you are now good to start your business.