While there are several business structures in Singapore, the most popular is the private limited company due to its countless of benefits especially when it comes to asset protection, limited liability, and tax and developmental incentives.
But before any entrepreneurs form a Singapore company, they should first consider the following:
- Under the Singapore Companies Act, a private limited company is allowed to have one or up to 50 shareholders. However, there should be at least one resident director and one qualified secretary.
- A resident director may be a natural citizen or a foreigner who has Employment Pass or EntrePass. Meanwhile, there is no limit on the number of additional directors, both local and foreign, as long as they are at least 18 years old, not considered bankrupt, and not convicted from any criminal and malpractices charges.
- The appointed company secretary must be a “natural person” who is a resident in Singapore.
- The paid-up capital for Employment Pass and EntrePass is at least S$1 and S$50,000, respectively. It is important to note that paid-up capital can be increased anytime after the incorporation process.
- The company name must be approved by the Accounting and Corporate Regulatory Authority (ACRA) before this is incorporated. In case the proposed company name is used by another company in Singapore, or deemed vulgar and indecent by the authorities, it will be automatically rejected.
- Foreign companies and individuals can own 100 percent shareholdings and may still qualify for certain tax and developmental incentives.
- A private limited company should have a registered office address which must be a “physical address” and not a PO Box. In certain types of business, the use of a residential address is allowed. (Legally speaking, the registered address is where the companies should secure and keep their statutory documents. )
- Companies should secure their Memorandum and Articles of Association to ACRA. These documents explicitly show the activities a certain company may be engaged to and the rules governing its internal management.
Foreign companies and businessmen can also register and own a private limited company which is still considered as a local resident business, thus, it is eligible for the local tax rates, tax exemptions, and developmental incentives.
Meanwhile, foreign business organizations and individuals are required by the Singapore Companies Act to appoint a professional registration firm during the incorporation process since they are prohibited to self-register their own business.
AsiaBiz is the leading Singapore company that provides Singapore Company Incorporation services to local and foreign entrepreneurs and investors and offer consultation regarding the immigration and taxation, accounting and book keeping requirements, and other compliance matters stated under the Singapore law. AsiaBiz has successfully helped thousands of foreign and local entrepreneurs form a Singapore company .