Singapore Company Incorporation Requirements
For years, New York, London and Shanghai are some of the common place where investors look at in search of the meaning of greener grass on the other side.
For a budding entrepreneur, the world is filled with endless possibilities, and in the region of Asia Pacific, where else can give your such opportunity but Singapore.
For years, the Singaporean government has continued to build a strong foundation that handed internationally renowned companies the confidence to set up headquarters and hubs in the Republic.
Singapore is a country that has reinvent herself as a business-attractive nation on the globe.
Everything about her is carefully designed to be as friendly as possible for small and large entrepreneurs alike.
From the company incorporation process, the taxation system, and the legal system, every single factor in this country is designed to be business friendly.
If you are thinking of incorporating a company in Singapore, then you have come to the right place to obtain the right information.
By the time you are done reading this article, you will understand how to incorporate your company with ease. The entire process is easier than it may appear, because Singapore has eliminated bureaucracy as much as possible, just enough to become even more business-friendly.
Your Singapore Company Incorporation End Goals
With an impressive list of start-ups like Grab, One Championship and PropertyGuru, Singapore is considered as the best place to start a new business.
However, before setting up your company and becoming like the ones mentioned above, you must bear in mind, there will only be 2 possible outcomes in this proceeding:
- You succeed in becoming an entrepreneur
- You will fail in your business venture
In order to build up a successful business, it is vital for you to understand why other similar capacity start-ups have failed before, and how do you improve from their mistakes. Entrepreneurs often overlook the value of conducting a market survey, something which has return to bite many investors.
Also, if your team is lacking with dedication, has conflicting skillset, and has no ambition, the start-up is likely to fail.
Factors when Incorporating a Successful Business in Singapore
This is where we give you a few pointers to take note, so that you will have your business incorporated at ease.
If you wish to start a business in Singapore, it is important that you familiarize yourself with the culture of the multiracial citizens that resides in Singapore.
Acquaint yourself with the laws and regulations of the country, conduct as much research as possible to help your Singapore company incorporation sail towards the right direction. The last thing we want is any complication with the authorities.
Fret not, because we at Paul Hype Page & Co is an expert when it comes to Singapore company Incorporation, and we will guide you all the way to the finish line.
Singapore Company Incorporation Procedure
Under Singapore Company law, resident, non-resident individuals or entities cannot self-register a company. All Singapore Registered Companies, prior to the incorporation, must engage the Accounting and Corporate Regulatory Authority (ARCA) licensed service provider – just like Paul Hype Page & Co – to register your Singapore company.
Decide on the Type of Business & Your Company Name
These two are the most important step before the rest, decide on the name of your company. It is then advisable to get your company a company business profile. This will be helpful when you are approaching investors and the authorities.
There are several ways where companies can be classified. They can be classified because of their limitations, or they can be classified on whether they are a private limited company or a public listed company, partnerships or limited partnership. Based on their limitations, they can either be limited by shares, guarantee, or they can be unlimited companies.
You will need to propose and reserve your company name in Singapore. However, ACRA will reject a proposed company name if,
- It is identical to another existing Company Name
- It is undesirable
- It is like an established name or in the category of trademark
Requirements to Register Your Singapore Company
In order to successfully register your company with ACRA, there are requirements, rules and regulations that you will need to keep abreast with. You will need to:
Have at least one director who is a local and legal resident of Singapore who is 18 years old and above.
1. Before we proceed further, let us brief you with the types of Company Director
- Shadow Director
In addition to those who are appointed by law, any person other than a professional adviser for the company, with whose instructions the directors of the company normally comply is a shadow director.
- Alternate Directors
Alternate directors are persons who are nominated by a director to act in their absence.
- De facto Directors
A de facto director is a person who has not been validly appointed or who is disqualified but who in effect occupies the position of, and acts as if he were, a director.
- Executive Directors
Executive directors are directors of the company who are involved in the day to day management of the company. In practice, some of them may have specific titles within the company, eg, managing director, marketing director or finance director.
- Non-Executive Directors
Non-executive directors are not involved in the day to day management of the company. There is no legal obligation for a company to appoint non-executive directors.
2. An individual that has been declared bankrupt is disqualified from acting as a director of a company.
3.Being legal resident here refers in the context of an ordinarily resident in Singapore. This means the local resident director’s usual place of residence is in Singapore. A Singapore Citizen, Singapore Permanent Resident, or EntrePass holder can be accepted as a person who is ordinarily resident in the Republic.
4. If you are a S Pass holder or an individual with a legal visa (dependant visa, tourist visa and etc) to reside in Singapore, it is almost impossible to incorporate a Singapore company as this is determined on a case by case basis.
5. The visa holders mentioned must send an application to Ministry of Manpower (MOM), whereby their visa to be converted to an Employment Pass (EP). If approved, they can proceed to register their business and be the director of their company.
6.Foreigners who is not a Singapore Permanent Resident and wishes to set up his own business/sole-proprietorship is required to appoint a locally resident authorised representative, also known as a local nominee director.
7.Identification documents for the director/ shareholders of the Singapore company, passports and special Director’s resolution certificate of incorporation.
8. MOM will run through a random check every 3 months, and whoever under the S-Pass and is a director and shareholder of a company will be booted out of Singapore.
Have a physical registered address
- This cannot be a P.O box. Why? Because for legality, it is needed for an individual to be resided in an address.
- Home Office Scheme (2003) allows individuals to use their residential address as the business address. However, an approval will need to be obtained from the Housing Development Board (for HDB flats) or Urban Redevelopment Authority (URA – for private properties) if a residential address is being used as a business address. Approval is subjected to the discretion and guidelines of HDB and URA.
Have enough paid–up capital
- Paid up capital derived from the share capital in the company.
- Share capital refers to the money that has been invested in the company by shareholders in exchange for shares. Under Singapore’s company law, companies can issue shares without obtaining payment from the intended shareholders. Hence, the total share capital of a company can be divided into two categories: paid-up capital and unpaid capital.
- Paid-up capital refers to the issued capital that is paid up by the investors and shareholders. For an incorporation, there must be a minimum input of $1 for the issued capital.
- Any Singapore citizens and Singapore Permanent Residents and foreign entrepreneurs who are relocating to Singapore need to only have the minimum paid-up capital of S$1 at the time of Singapore company registration.
- Foreigners who wish to relocate to Singapore under the Singapore Entrepreneur Pass scheme are required to invest a minimum sum of SGD$50,000 as paid-up capital at the time of company incorporation.
Have a company secretary who must be a natural resident of Singapore
- Section 171 of the Companies Act requires all Singapore companies to have at least one secretary (but there can be more).
- The office of secretary cannot be left vacant for more than 6 months at any one time.
- Paul Hype Page & Co can act as the company secretary in the event of a vacant position.
Passing Singapore’s Required Anti Money Laundering (AML) and Know Your Customer (KYC) Checklist
- This is a vital step for any Singapore company incorporation. All our existing and new client will go through this step as part of the compliance process.
- Know your customer (KYC) refers to due diligence activities that all regulated companies must perform to ascertain relevant information from their clients for doing business with them.
- With our pending patent ibizfile system, together with the assistance of Dow Jones, the process of conducting a KYC search is easy, effective, and legitimate in accordance to the Singapore Evidence Act.
Singapore Tax Exemption
A key requirement for tax exemption in Singapore is to set up an offshore company in Singapore is the corporate tax rates but Paul Hype Page & Co has a distinct advantage because with our physical office and staffs. We offer the following services to ensure that you are TAX Compliance:
- Domiciliation Services
- Services Office with REAL staffs running your operation
- Registered Agent Services
Singapore offer a Start-up Tax Exemption Scheme which allows new offices to claim full tax exemption. The amount is up to SGD$100,000 on qualifying expenses for the first 3-years of tax assessments.
Post Singapore Company Incorporation
After a successful registration, Paul Hype Page & Co will,
1. Prepare your Singapore incorporation documents
2.Register your company with ACRA
3.Assist you with opening corporate bank accounts in Singapore
4.Submit an electronic Certificate of Incorporation, which is a Certificate Confirming Registration / Incorporation of Entity shows that an entity is registered in Singapore
5.Obtain a Business Profile extract from ACRA
6.Create minutes of your first board meeting
7.Create and keep in safe custody the company seal or company/branch office rubber stamp and pay the relevant government and professional fees.
8.Typically, the process to have your company up and running takes about 24 – 72 hours. However, that will depend on how fast we are given all the documents required. Company registration might take longer if,
- The company is a corporate entity
- Identity card/ passport / corporate ID of any director failing the required risk assessment test
- Insufficient documents presented to Paul Hype Page for incorporation
- Documents in iBizfile expires after 72 hours
Funding Your Singapore Business
There are two ways when it comes to financing a company, Share capital and debt finance. While self-financing your start-up can be the best way, it comes with a big downside as you may just be left with nothing when the venture doesn’t pan out. However so, this may still be our suggested option.
If you can get funding from your own reserves, there are a variety of ways you can go about it.
One thing that you need to understand, those who provide equity capital (capital financing) to a company are ‘members’, and therefore have the rights of members conferred on them by the terms of issue of their shares. Lenders and other creditors are not members and do not have the rights of members.
Types of Self-financing
- Personal savings
- Refinancing of personal assets such as land, home, or shares
- Cash in Retirement Accounts
- Cash in mutual bond funds
Types of Debt Financing
- Friends and Family
- Take Out Bank Loan
- Venture Capital
- Angel Investors
- Peer-to-Peer Loans
Singapore Company Shareholder Agreement for Your Singapore Business
A shareholder agreement augments a company constitution and sets out the understanding of the various business parties, most importantly between the shareholders and the directors.
Usually, when it is all smooth sailing at the early stage, or during the early stage of the business operation when profit is at marginal. However, when there’s soaring high income, that is when issue will arise, no matter what relationship the shareholders carry outside the corporate environment.
The shareholder agreement is an important element in a business, whereby when there any dispute will be mediated by looking into the agreement.
Shareholder agreement will be between,
- Some of the shareholders;
- All the shareholders; and
- Shareholders and the company.
A well-drafted Shareholder Agreement will generally contain the following terms:
1.Roles of the management staffs of the company
In this you will determine who will exercise the management functions of the company. Usually the work load will be divided equally, and if one party does not fulfil his/ her responsibility, then the agreement clause can be triggered.
2.Loyalty and confidentiality
This will state what kind of obligations are necessary to ensure the company’s secrets are preserved and how can the founders be restricted from leaving and starting a rival company.
3.Return of investment
How can the founders and investors recover their investments and what is the company’s dividend policy among the shareholder.
In an event of share sale, how will the shares be valued and distributions among shareholders
5.Giving up of shares
Can the founders and investors sell their shares at any given time and what are the rule of thumb as per the agreement.
6.Contribution in the event of disability or death
In the event of an unforeseen circumstances, the remaining shareholders no longer have the benefit of the deceased or disabled shareholder contributing towards the business, and that the family will want compensation from the business. If the family is unable to wait for their payments, life insurance could be used to resolve the dispute.
Amendment of Agreement
The agreement is a legally binding contract, and parties involved inside the agreement must follow the procedures outlined in the document or the bylaws to amend it.
The procedure for amending a shareholder agreement can be detailed in the document itself. In either case, the subject must be proposed during the board of directors meeting and majority of the directors must agree that an amendment is appropriate. The board must then proceed to record its decision to amend as a corporate resolution.
In any case, in Paul Hype Page & Co, we believe a shareholder agreement is very important for any Singapore Company Registration.
Striking Off a Singapore Company
This is a sub-topic that we are not a fan of writing, however, it is great for you to have a little knowledge on. In business, anything is possible, high or low, win or lose.
If everything goes as planned with your company, then it is great news and we will be very happy for you. If it doesn’t, then you need to have an exit plan, which is to strike off a company.
The Procedure of Striking off in Singapore
To have the name struck off the Register of businesses, a company will need to apply to ACRA.
A striking off process takes about 5-6 months because there are several steps that need to be fulfilled in pursuance of the striking off.
Application must be submitted to the Company Registrar. ACRA usually take 7 working days to process the application, based on the complexity of the case and whether the supporting documents submitted are satisfied.
Subsequently, after assessing the documentation and conducting investigations, and if ACRA is satisfied that the company fully meets the criteria for striking off,
- a striking off notice will be sent to the company at its registered office address,
- One will be sent to the company’s directors and company secretary at their residential addresses,
- One will be sent to the Singapore governmental authorities.
However, approval of the application can only be fulfilled if it satisfies its criteria stated below:
- The company must not be involved in any court proceedings whether inside or outside Singapore
- It has ceased all business activities
- The company must have no assets by the time of application
- The company’s must not have any liabilities such as fines, outstanding penalties or offers of composition owing to any governmental or statutory body
- The company’s directors and secretary must not have any outstanding summonses and civil charges against any of them.
- Upon striking off, the particulars of the directors must be the same as in the records of ACRA
- All shareholders must consent to the striking off and the company must obtain a letter of consent (LOC) from each shareholder
After 4 months, a final notification that the company has been struck off the Register will be published, along with the date that the company is struck off.
Our Value Added in Your Singapore Company Incorporation
As Singapore’s NO. 1 company incorporation service provider, our dedicated Corporate Specialists are here to guide you through the entire Singapore company incorporation process.
We have 3 physical offices located in Malaysia, Indonesian and Singapore., and we have yet to include our virtual office in Korea.
That means, coming in with Paul Hype Page & Co, do not only open you to the Singaporean client base, but open a possibility of conquering the Association of Southeast Asian Nations (ASEAN) region.
With 3 other offices in the Association of Southeast Asian Nations (ASEAN) region, we can guide you to venture your business into that region.
Paul Hype Page & Co will provide you with personalize and private consultation if you need help with matter such as,
- Banking within your jurisdiction
- Business liaising with the government department
- Business license applications
- Emailed documentation of your addresses matters on your residency, financial background from your country of origin
Happy with our article? Want to know more? We are ever ready to help you! Contact us today and get your Singapore dream kick started.