A private company limited by shares is the most common type of company.
A Singapore Company may be registered with only one shareholder who can be an individual or a corporation. There is no requirement for shareholder(s) to be resident in Singapore.
The liability of the shareholders is limited to the amount, if any, unpaid on the shares issued to them. However, there is no minimum capital requirement. The company can be formed with an issued capital of SGD$ 1 that can subsequently be increased to the required amount. The par value of shares is usually fixed at SGD$ 1 per share. No-par value and bearer shares are not permitted.
General Entry Steps : Check Availability of Company Name
This step is required with every company structure when entering the Singapore market. The first procedure of the incorporation or registration process is the approval and reservation of the company name. Submit your application online via Bizfile with your SingPass password. Appoint a professional firm if you do not have a SingPass.
An application fee of SGD$15.00 is payable for each approved company name. Reservation is for 60 days but can be extended for a further 60 days before expiry. The fee for the extension is SGD$ 10.00 per name. Approval of a name takes usually one hour.
Agency: Research business names at Bizfile as to avoid identical or too similar names of any existing company.
Note: You can register a name online with your SingPass if you are a Singapore resident. Otherwise you require assistance of a professional company.
Time: 1 hour
Cost: SGD$15.00 additional cost of SGD$10.00 to extend past the 60 days
1. Registration
Application by a foreign company is mandatory through a professional business registration firm such as corporate secretarial firms, law firms and accounting firms.
Note: A foreigner, who wants to relocate to Singapore to be the director of his own company needs to apply for an Employment Pass under the EntrePass Scheme at the Ministry of Manpower (MOM). Only upon approval of his EntrePass application, he may then proceed to himself incorporate the company with ACRA. He may also apply for an EntrePass if he owns a company registered with ACRA for not more than 6 months at the point of his EntrePass application.
A company must have a registered office situated within Singapore. Your company registration agent can provide this service if required. You may alternatively register a residential flat or property under the Home Office Scheme (HO).
The first step in incorporating a company is to obtain approval for the proposed name. Names for all companies in Singapore must conform to certain guidelines laid down in the Companies Act.
After the company name has been approved, the following incorporation documents must be prepared and filed:
- Memorandum & Articles of Association setting out the objects and by-laws of the proposed company.
- Statutory Declaration of Compliance (Form 6)
- Certificate of Identity (Form 7)
- Notice of Situation of Registered Office and of Office Hours at time of Incorporation (Form 44)
- Consent to Act as Director & Statement of Non Disqualification to Act as Director (Form 45).
Note: An alternative to the above registration process is through something called ‘shelf companies’. Acquiring the shares of a shelf company allows an investor to almost immediately start a business in Singapore. Readily incorporated shelf companies with no prior business operations are easily available, usually with an authorized share capital of SGD$100,000 and a paid-up capital of SGD$ 2. The share transfer will normally take only one or two days.
Agency: Accounting and Corporate Regulatory Authority (ACRA) – BizFile portal
https://www.psi.gov.sg/NASApp/tmf/TMFServlet?app=RCB-BIZFILE-LOGIN-1B
Time: Usually within 15 minutes after registration fee is paid.
Note: However, it may take between 14 days to 2 months if the application needs to be referred to other authorities for approval or review. For example, if the intention of the foreign company is to carry out activities involving the setting up of a private school, the application will be referred to the Ministry of Education.
Cost: Name Approval Fees SGD$15,
Registration Fee for Foreign Company with share capital is SGD$300
Registration Fee for Company limited by Shares, SGD$600.
Note: For income tax purposes, a company is taxed in its own name.GST registration will be in the name of the company. It will have to sum up its turnover and all its sole-proprietorship businesses (if any) to determine its liability to register for GST. You may need to register for GST if your turnover for any 4 consecutive quarters ending March, June, September or December exceeds $1million. This is regardless of your financial year end.
2. Appoint a Representative(s)
‘One man’ companies with a single (individual or corporate) shareholder are admissible, and a company can only have one director. However, at least one director must be “ordinarily resident in Singapore”, i.e. a Singapore Citizen, a Singapore Permanent Resident, or a person who has been issued an Employment Pass/Approval-In-Principle letter/Dependant’s Pass. Any person at least 18 years old may be appointed as a director.
Every foreign company registered under the Companies Act must have two agents acting on its behalf in Singapore. These agents must be Singaporeans, Singapore Permanent Residents or Singapore Employment Pass Holders.
Directors of a Singapore company bear a host of duties and responsibilities. The Companies Act requires directors to act honestly at all times and exercise reasonable diligence in discharging their duties. Directors’ duties fall under three main categories:
- Fiduciary Duties: Directors have to act in what they honestly believe to be the company’s interests, and not in the interests of any other party.
- Duty of Skill, Care and Diligence: A duty of care means, for example, that a director needs to find out what his powers and responsibilities are under the company’s articles and under the law.
- Statutory Duties: Statutory duties are imposed on directors by statute, principally the Companies Act.
A Company Secretary, responsible for maintaining the company records and other administrative duties as prescribed by law, must be appointed within six months. The secretary shall be a natural person who has his principal or only place of residence in Singapore. The Companies Act prescribes minimum qualifications as regards who can be a company secretary. Private companies may also appoint their qualified employees or directors to perform these duties.
An Auditor must be appointed within three months from the date of incorporation unless it is exempted from audit requirements under Section 205B, or 205C, of the Companies Act. In practice, appointment is arranged upon incorporation of the company.
Agency: N/A (arranged by your company)
Time: N/A
Cost: N/A
3. Make a Company Seal
Company seals in Singapore are not a common practice other than for shareholder certificates and for some other organization such as schools who produce certificates.
Nonetheless, it is a good practice to hold a company seal for any problems that may arise in authentication of a document from the company. Many companies can produce your company seal in Singapore normally taking only one day to produce and prices will range from S60-S138
Agency: Commercial service that can be provided by many companies
Time: 1-2 days depending on the company used
Cost: SGD$60-138
4. Open a Corporate Bank Account
There are several well-known international banks active in Singapore, including Citibank, Maybank, and Standard Chartered as well as various national banks.
Commercial banks in Singapore are licensed under and governed by the Banking Act. They may undertake universal banking and banks may also carry out financial advisory services, insurance broking and capital market services. Commercial banks operate as full banks, wholesale banks or offshore banks.
Currently there are 28 full banks are operating in Singapore. Full banks may provide the whole range of banking business permitted under the Banking Act.
Foreign full banks with Qualifying Full Bank (“QFB”) privileges will be able to:
- Share ATMs among other foreign banks and relocate their sub-branches freely
- Negotiate with the local banks to let their credit card holders obtain cash advances through the local bank’s ATM networks.
- Provide debit services through an EFTPOS network
- Offer Supplementary Retirement Scheme and CPF Investment Scheme accounts, and
- Accept fixed deposits under the CPF Investment Scheme and Minimum Sum Scheme
Examples of foreign banks with full bank status in Singapore are like HSBC, Standard Chartered, Citibank, Bank of America, Bank of China, Bank of India, ANZ, RHB bank, etc.
Agency: Commercial Bank
Time: 1 day
Cost: None
5. Sign up for Employee Compensation Insurance at an Insurance Agency
Employers are required by law to contribute to the Central Provident Fund (“CPF”). Under the scheme, employers are to ensure that CPF contributions are paid monthly for its employees at the rates set out in the Central Provident Fund Act. The employer is entitled to recover a percentage of that contribution from the employee through deductions from the employee’s wages.
CPF contribution by the employer is mandatory for all local employees (citizens and PRs) earning more than SGD$50 per month. The maximum contribution rate for employer and employee is 16% and 20%, respectively, but can sometimes be lower depending on certain factors.
You can apply to e-submit CPF contribution details using CPF’s e-Submit@web as soon as you intend to hire your first employee. To apply, you will need a SingPass and the company’s Unique Entity Number (UEN). Upon approval, you will receive an email and welcome letter containing a CPF Submission Number (CSN), Payment Advice (CPF91) and Direct Debit Authorisation Form.
CPF contributions are generally payable for the following employees:
- Company Directors
- Part-time/Casual Employees
- Operationally Ready NSmen on in-camp training. Under the Enlistment Act, employers have to pay the CPF contributions on the wages given by the employer and makeup pay from MINDEF. The employee’s share of contributions can be recovered from the employee’s wages.
- Family members of the business owner, if they are receiving wages for work done for the proprietor.
- Employees concurrently employed by another employer
For foreign employees: CPF contributions for foreign employees is not applicable.
Employers have a grace period of 14 days to make payment of CPF contributions after the end of the month for which CPF contributions are due. If the due date falls on Sunday or Public Holiday, CPF contributions must be paid by the next working day.
Employers are required to pay the employer’s and employee’s share of CPF contributions monthly for all employees (Singapore Citizens and Singapore Permanent Residents) at the rates set out in the CPF Act. The contributions payable should be based on the employee’s actual wages earned for the month.
Note: Health insurance: It is not a statutory requirement to provide private health insurance benefits to employees in Singapore. Employees are automatically provided with a low-cost medical insurance called Medishield.
Agency: CPF Board – http://www.cpf.gov.sg using e-Submit@web: http://mycpf.cpf.gov.sg/Employers/ESub-Home/ESub-Auto-eXcel-plus/eSub-usrAutoeXcelPlus
Time: 3 days
Cost: None