Singapore company registration is governed by the Companies Act (Cap 50) of 1967, as amended.
There are no restrictions on the nature of activities which a Singapore company may undertake, provided such activities are within the boundaries of the law. Certain activities may be subject to licensing and regulation.
Singapore company registration timeframe
A Singapore company registration is normally completed within one to three business days. Shelf companies are usually available for immediate use in urgent situations.
It is possible for a foreign company to become registered and continue as a Singapore company registration, provided this is also allowed in the jurisdiction where the foreign company is currently incorporated. In order to quality for redomiciliation, the foreign company must be able to satisfy two of the following three criteria at the end of the two preceding financial years: revenue must exceed S$10 million, total assets must exceed S$10 million or total employees must number at least 50.
There is no provision in the legislation allowing a Singapore company to continue as a company registered in another jurisdiction.
Information held on public record
Details of the company’s shareholders, directors, secretary, registered office address and registered mortgages and charges are maintained by the Registrar of Companies and are available to the public.
In addition, companies which do not qualify as exempt private companies must file copies of their financial statements, which will then become publicly available. In order to qualify as an exempt private company, a Singapore company must have no more than 20 shareholders, all of which must be individuals and the transfer of its shares must be restricted by its memorandum and articles.
In order for the Registrar of Companies to approve a Singapore company registration, the company’s name may not be identical to an existing company’s name, nor may it be “undesirable”. The company’s name must be in English and expressed in Roman characters.
The name must end in “Limited”, “Ltd”, “Sendirian” or “Sdn” to denote limited liability. A private company must also include one of the terms “Private”, “Pte”, “Berhad” or “Bhd” in its name. A private company is defined as one with a maximum of 50 shareholders and whose memorandum and articles restrict the transfer of shares.
A Singapore company’s share capital may be denominated in any currency but normally it is denominated in Singapore dollars. At least one share must be issued at the time of the Singapore company registration. Bearer shares are not allowed.
The minimum number of shareholders for a Singapore company registration is one. Shareholders may be natural persons or other companies, incorporated in Singapore or elsewhere. Individual shareholders may reside in any country. The shares may be held through nominee shareholders if confidentiality is required.
At least one director must be appointed at the time of the Singapore company registration, who must be a resident or citizen of Singapore. Additional directors may be appointed, who may reside in Singapore or abroad. No corporate directors are allowed. It is possible for the same person to act as both sole shareholder and sole director.
Shareholder and director meetings
Meetings of the shareholders and of the directors of a Singapore company may be held anywhere in the world, including by telephone conference if this is allowed by the company’s articles of association. It is also possible to adopt resolutions in writing instead of holding physical meetings.
The company’s shareholders are required to hold an annual general meeting (AGM) in each calendar year. The first AGM must be held within 18 months of the date of the Singapore company registration. This may result in no AGM being held in the year of registration of the company or in the following year. After the first AGM has been held, subsequent meetings may not be more than 15 months apart. Private companies may elect to dispense with the requirement to hold annual general meetings.
Every Singapore company is required to maintain a registered office in Singapore. This is normally where the statutory registers and records and the common seal are kept, although it is possible for these to be kept at a different location.
A company secretary must be appointed within 6 months from the date of the Singapore company registration. The secretary must be an individual, who is a resident or citizen of Singapore and who has adequate knowledge of the responsibilities carried by this office. If the company only has a sole director, it is not possible for the director also to act as the secretary.
Singapore companies have an obligation to prepare financial statements each year, which must be in accordance with International Financial Reporting Standards. The financial statements of every company which is not a Small Private Company must be audited.
In order to qualify as a Small Private Company, a company must have no more than 50 shareholders, all of whom are individuals and also satisfy two of the following three conditions: (i) its total staff may not exceed 50; (ii) its turnover may not exceed S$10 million; and (iii) its total assets may not exceed S$10 million.
Annual filing requirements
Singapore companies must submit an annual return with the Registrar of Companies. This must be accompanied by a copy of the financial statements unless the company qualifies as a Solvent Exempt Private Company. The conditions for a company to be considered as a Solvent Exempt Private Company are that it has no more than 20 shareholders, all of whom are individuals and that it is able to meet its liabilities.
An annual tax return is also submitted with the Inland Revenue Authority of Singapore (IRAS).
Singapore has adopted a territorial taxation system. This means that a company is not taxed on its worldwide income but instead on income which is generated in or remitted to Singapore.
The rate of corporate tax in Singapore has been declining in recent years and presently stands at 17%. However, every newly incorporated company is entitled to certain tax incentives during the first three years from the date of the Singapore company registration. For each of the first three fiscal years, 75% of the first S$100,000 of taxable income is tax exempt, while 50% of the next S$100,000 is also tax exempt. In addition, the company will be entitled to receive a tax rebate. In order to qualify for these incentives, the company must have at least one natural person as a shareholder, holding a minimum of 10% of the issued shares. This exemption is not available to companies whose principal activity is investment holding or property development, whether for sale or investment purposes.
Dividend income received by a Singapore company is not subject to tax unless remitted into a Singapore bank account. Even if remitted to Singapore, the dividend may qualify for tax exemption if it has been taxed in the jurisdiction from which it is received and provided the highest corporate tax rate of that jurisdiction is at least 15% at the time when the dividend is received in Singapore (even though the dividend may have in fact been taxed at a lower rate).
If the company’s turnover exceeds S$1 million, the company will normally be required to register for goods and services tax (GST), unless the nature of business falls outside the scope of GST, eg trading in commodities.
The fiscal year in Singapore runs from 1 January to 31 December.
Double tax treaties
Singapore has concluded close to 100 double tax treaties with other jurisdictions. A company may gain access to the significant benefits provided by these treaties if it is able to demonstrate genuine tax residence in Singapore.
Considering the status of Singapore as one of the world’s leading international financial centres, its highly efficient government sector, political stability, modern laws and the low rates of tax, Singapore company registration is very highly sought after. Singapore companies are very effective vehicles for establishing a regional presence in Asia, for carrying out international trade operations and to act as group holding companies.