In Singapore, around 77,379 business entities were legally registered in 2014 alone according to a report by the Department of Statistics Singapore. While these numbers are impressive and are continuing to grow, you must familiarize yourself with the requirements of starting up a company in Singapore. That said, to complete a successful company registration process in Singapore, there are some requirements you should meet.
Ready? Well, this Singapore company registration checklist should help you understand the process of forming a company in Singapore successfully.
Proposed Company Name for Approval
First and foremost, you should submit the name of the company you intend to start for support by the ACRA (Accounting and Corporate Regulatory Authority). This is the body mandated to oversee the regulation of companies as well as facilitating their development. Also, ACRA can impose fines or issue court summons to companies defaulting the ongoing compliance requirements.
In Singapore, it’s a must your company has a minimum of one resident director. This director can be a citizen of Singapore or a permanent resident. Alternatively, this individual could be a dependent pass holder or hold an employment pass. However, the law requires them to be 18 years of age or older, doesn’t have any past criminal record and is not bankrupt.
In addition to this, directors can’t hold any shares with the company. He/she is just appointed in compliance with the requirements of the Singapore Companies Act. Also, the company can have as many as possible local and foreign directors.
This is also one of the primary requirements when you want to incorporate in Singapore. Shareholders can either be local or foreign corporate bodies or individuals. You are limited to a minimum of 1 and a maximum of 50 shareholders.
After incorporation, shares can now be transferred to shareholders. If your company manages to rope in at least 20 shareholders, it can now be considered as an EPC (Expert Private Company). The best part is that 100% foreign shareholding is legal.
After incorporation, you have a maximum of 6 months to appoint a qualified individual as the company’s secretary. Also, the company secretary must be residing in Singapore and must not either be a director or a shareholder.
A minimum of S$1 is paid up during the incorporation process and can be of any currency or tangible/intangible asset such as shares. Also, this minimum capital can be increased at any time.
Just like any other nation in this digital age, in Singapore, you also need to register a business address for your company. This local address can either be commercial or residential, but not a post office box. However, if you’re a foreigner, you’re not allowed to self-register, although seeking the services of a registered agent is allowed
Register for General Sales Tax (GST)
You may need to register for Goods and Services tax if your company’s normal turnover is above SGD1 million/year for local supplies only. There are favorable tax exemptions and incentives such as:
- No taxes on dividends or capital gains.
- On your first annual profits of S$300,000, you’ll pay not more than 8.5% tax and 17% after that.
To sum it up, the above checklist gives you an overview of the critical requirements of Singapore company registration. Getting to know the criteria will help you prepare ahead, thus minimizing the unexpected risks you may later encounter.