Forming a business in a foreign country is a challenging thing to do. Every jurisdiction has its own unique rules, regulations, and processes you have to abide by. The same applies to Singapore as one of the world’s economic hotspots attracting people from all over the globe.
As you know, there are various types of companies. Forming each one of them is different. If you want to start a private limited company in Singapore, you’ve come to the right place. Here is what you need to do to form such a business in Singapore.
Meeting The Minimum Registering Requirements
Before we tackle the specifics, you need to know that every business in Singapore has to abide by the Companies Act. It also must be registered with the Accounting & Corporate Regulatory Authority (ACRA). To register a private limited company in Singapore, you also need to meet the minimum registering requirements.
- One shareholder
- One resident director
- One company secretary for the first six months
- The minimal share capital of S$1
- Office address in Singapore
Decide The Company Name
Let’s start with something that doesn’t require you to abide by any laws and regulations. Before you start incorporating a company in Singapore, you need to come up with the company name. Keep in mind that the company name will be the central piece around which you will build your brand image.
While you are at it, make sure that the domain name for your future company website is available. You can do it for free at any of the popular domain registrars found online. Once you are done, it is time to get to some real work.
Describe Your Company Activities
Your company will engage in particular activities. You need to make sure to match your activities with those planned for companies in Singapore. There is no way around it. All your company’s actions must be in line with activities strictly defined by Singapore’s governing bodies.
To do it, you will have to consult the Singapore Standard Industrial Classification CODE (SSIC) 2020.
Make Shareholders Agreement and Pattern
Private limited companies in Singapore are separate legal entities from their shareholders and are limited by shares. However, to incorporate one, you will need to come to make a shareholders agreement and pattern.
The shareholder pattern should indicate to which member the subscriber shares will go. Since you can register a company with only one shareholder, making a pattern can be easy.
A shareholders agreement is a must-have, even if you have only one shareholder. The agreement should outline the relationship between shareholders, their obligations, rights, and responsibilities.
Shareholders can be individuals (up to 50 for private limited companies) or corporations. Also, a director of the company can be a shareholder at the same time. However, a director must be a permanent resident in Singapore.
Individuals who have a Dependant’s Pass, Employment Pass, or Entrepreneur Pass with a residential address in Singapore also qualify for the director position.
Register An Address
To complete the process of incorporating a company in Singapore, you need to have a registered physical address. A P.O. Box doesn’t count. However, for some types of business activities, it is allowed to use a residential address.
In any case, the address is required for official correspondences with various Singapore offices and to register a bank account.
Appoint A Company Secretary
Every newly incorporated private limited company in Singapore must have a company secretary during the first six months following the incorporation. This is a tricky part. A company secretary must be experienced in legal matters, private limited company practices, and regulatory compliances.
Given the entire process, including finding and appointing a company secretary, is rather complicated, many individuals and corporations who want to register a business in Singapore choose to outsource the entire process to a company incorporation service specialist. One of the best specialists in this niche is Piloto Asia, with thousands of successful private limited company incorporations in Singapore.
Do You Need An Auditor or Not?
Singapore’s regulatory compliance requirements indicate that a limited private company must appoint an auditor. The auditor must be appointed within three months of incorporation. However, not all companies fall under this rule. If a company has an annual turnover of less than S$5 million and less than 20 shareholders, it is exempted from this rule.
Registering a Bank Account
A private limited company needs to have a bank account as it is a completely independent legal entity. However, to open a bank account, you need to provide a resolution signed by the board of directors. The resolution has to specify the signatories to the account.
This covers the basics of how to form a private limited company in Singapore. Hopefully, it will help you in doing so successfully. As you can see, it is a structured and complicated process. Paying attention to details is vital because there is no room for errors.