Singapore Company Incorporation Overview

Prices in U.S. Dollars (Prices below do not include Resident Nominee Director. Please refer to our Nominee Service Price List for fees.)

 

Incorporation$1,180
Hong Kong Bank Account$800
Bank Account in Singapore, Latvia, Austria, British Virgin Islands, St. Vincent & The Grenadines, Mauritius, or Belize$750

 

A Singapore Private Limited Company is a business entity registered under the Companies Act, Chapter 50. Unlike a business firm such as a sole proprietorship or partnership, it has a legal personality i.e. it has rights to own properties, can sue or be sued. It usually has the words 'Pte Ltd' as part of its name.

 

There are 2 types of Private Company limited by shares: (1.) Private Company - locally incorporated company where the number of shareholders is limited to 50;  (2.)  Exempt Private Company - which has no more than 20 shareholders and none of the shareholders are a corporation. For such company, the company can choose to file a Certificate of an Exempt Private Company instead of its accounts at the time of filing its annual return, subject to certain conditions such as the annual revenue must not be more than S$5 million.

 

The Companies Act requires a minimum of one director, who must be a Singapore resident individual, .i.e. a Singapore Citizen, a Singapore Permanent Resident, a person who has been issued an Employment Pass/Approval-In-Principle letter/Dependant's Pass. Any person above the age of 21 years may be appointed as a director. However, some individuals e.g. bankrupts, are disqualified from being directors. A foreigner who wishes to act as a local director of a company can apply for an Employment Pass/Approval-In-Principle letter from the Employment Pass Department of the Ministry of Manpower.

 

A minimum of one shareholder is required and shareholders may be corporations or individuals. Companies are also required to appoint a resident company secretary, who must be a natural person and Singapore resident.

 

Directors, Shareholders and Company Secretary information are disclosed to the authorities and are public records.

 

Accounts must be kept for all companies. Annual audited accounts are required to be filed with the Singapore Registrar unless it is a Exempt Private Company with (1.) an annual turnover of less than S$5 million, (2.) Members of the company do not exceed 20 and (3.) Members of the company are individuals and not a corporation.

 

The first Annual General Meeting of a company must be held within 18 months of its incorporation. After that, an AGM must be held once in every calendar year and not more than 15 months after the last AGM. As required under Section 197 of the Act, the company must file its Annual Return within 1 month after the AGM.

 

The Singapore tax structure is pro-enterprise and pro-business - a host of tax schemes and incentives have been put in place to help companies grow their business. The corporate tax rate for Year of Assessment 2009 is 17%. However, the effective tax rate can be reduced significantly (to 15%/10% or even 0%) for businesses that qualify for tax incentives. Foreign sourced dividends, foreign branch profits and foreign sourced service income are exempt from tax, subject to certain conditions. With its extensive tax treaties and unilateral tax reliefs, foreign dividends received in Singapore may generally be redistributed out of Singapore tax-free to the foreign investors.

 

Singapore has an extensive investment protection agreement and double tax treaty network. This includes most countries in the Asia-Pacific Region and countries in Europe, Africa and the Middle East. These countries include China, Indonesia, Thailand, Malaysia, Philippines, Vietnam, India, Japan, Korea, Australia, New Zealand, South Africa, United Kingdom, Netherlands, Germany, Switzerland, Sweden, France, Belgium, Finland and the United Arab Emirates.

 

Singapore is also one of the very few countries to have a tax treaty with Taiwan. This explains the popularity of Singapore holding companies for Taiwanese investments in to China and the region.

 

Full tax exemption can be granted on up to S$100,000 of the normal chargeable income (excluding Singapore franked dividends) of a qualifying company, for any of its first three consecutive YAs (year of assessments) from its incorporation.

 

The qualifying conditions for the full tax exemption are as follows:

  1. The company is incorporated in Singapore.
  2. The Company is a Singapore tax resident for the year of assessment under review.
  3. The company has not more than 20 shareholders throughout the year of assessment.
  4. All shareholders are individuals throughout the year of assessment

 


 

Key Corporate Features

 

General

Type of Entity Private Limited
Type of law Common
Shelf Company Availability No
Minimum Government Fees (Excluding Taxation) USD 40
Corporate Taxation 17%
Double Taxation Treaty Access Yes

Share Capital or Equivalent

Standard Currency SGD
Permitted Currencies SGD or USD
Usual Authorized US$ 1,000
Minimum Paid-up Capital US$1.00
Directors or Managers
Minimum Number One
Local Required Yes
Public Access to Records Yes
Location of Meetings Anywhere
Members
Minimum Number One
Public Access to Records Yes
Location of Meetings Anywhere
Company Secretary Required Yes
Local or Qualified Local
Accounts
Requirement to Prepare Yes
Audit Requirements Yes*
Requirement to File accounts Yes
Public Access to Accounts Yes
Other
Requirement to File Annual Return Yes
Change of Domicile Permitted No
* No, if a private exempt company.

 


 

General Information

Singapore with a total area of 692 sq km was founded as a British trading colony in 1819. It joined the Malaysian Federation in 1963 but separated two years later and became independent. Singapore subsequently became one of the world's most prosperous countries with strong international trading links (its port is one of the world's busiest in terms of tonnage handled) and with per capita GDP equal to that of the leading nations of Western Europe. In terms of purchasing power parity, Singapore has the third highest per capita income in the world. There are slightly over 5 million people in Singapore, of which 2.91 million were born locally. The population is highly diverse; the majority are Chinese, with Malays and Indians forming significant minorities. Reflecting this diversity, the country has four official languages: English, Chinese, Malay, and Tamil.

 

Infrastructure & Economy

Singapore has a highly-developed and successful free-market economy. It enjoys a remarkably open and corruption-free environment, stable prices, and a per capita GDP equal to that of the four largest West European countries. The economy depends heavily on exports, particularly in consumer electronics and information technology products. It was hard hit from 2001-03 by the global recession, by the slump in the technology sector, and by an outbreak of Severe Acute Respiratory Syndrome (SARS) in 2003, which curbed tourism and consumer spending. Fiscal stimulus, low interest rates, a surge in exports, and internal flexibility led to vigorous growth in 2004-06 with real GDP growth averaging 7% annually. In 2010, the GDP growth hits 14.5%. The government hopes to establish a new growth path that will be less vulnerable to the global demand cycle for information technology products - it has attracted major investments in pharmaceuticals and medical technology production - and will continue efforts to establish Singapore as Southeast Asia's financial and high-tech hub.

 

• Language

  • The official language is English with Chinese being spoken and used widely in business context.

 

• Currency

  • Singapore Dollar (SGD)

 

• Exchange Control

  • None

 

• Type of Law

  • Common Law Based on English Common Law

 

• Principal Corporate Legislation

  • Singapore Companies Act, Chapter 50

 

 

Company Information

 

• Type of Company for International Trade and Investment

  • Private Company limited by Shares and Exempt Private Company limited by shares.

 

• Restrictions on Trading

  • Cannot undertake banking or insurance activities or solicit funds from or sell it's shares to the Public.

 

• Powers of Company

  • A Singapore Company has all the powers of a natural person.

 

• Language of Legislation and Corporate Documents

  • English

 

• Shelf Companies Available

  • No.

 

• Language of Name

  • English

 

• Registered Office Required

  • Yes, must be maintained in Singapore.

 

• Name Restrictions

  • A name that is similar to or identical to an existing company. A name that constitutes a criminal offence or is otherwise contrary to the public interest. A name that implies royal or government patronage.

 

• Suffixes to Denote Limited Liability

  • Private Limited or Pte Ltd.

 

• Disclosure of Beneficial Ownership to Authorities?

  • Yes

 


 

If you are a lawyer, accountant , tax advisor or financial consultant and require services for your clients, please contact us for further options.

 

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