Being the Singapore’s most winning business form, Private Limited accumulates the major advantages that can boost a solid business with far-seeing plans. Setting up Private Limited Company in Singapore is a preferable way for serious foreign and local entrepreneurs who aim at expanding their businesses.
What is Private Limited in Singapore?
First of all, it is a business form that secures its owners’/members’ personal assets in different failure cases as their liability is limited to the firm’s shares. It means that if the company goes through harsh times (failures, debts, legal prosecution, and so on), its members do not risk anything except the firm’s assets. If you register a private limited company in Singapore, you can be more flexible, independent, adventurous, and calm while expanding your business in the same time.
The Private Limited’s reliability also positively impacts the company’s image. Such firm’s name usually ends with the words “Pte Ltd”, so your business partners (clients, investors, bankers, suppliers, or authorities) will always see you as a reliable company that is going to develop and grow. Our company that specializes in business incorporation in Singapore was also registered as Pte Ltd.
The definition of the Private Limited also includes involving up to 50 shareholders (not only individuals but also firms and trusts).The general public has no access to the shares. These shares can be multiplied, sold or passed to another owner, and this is the way how the firm’s ownership can be easily changed. The government sets no limits for the amount of the paid-up capital (shares) and its ownership (it can be absolutely foreign).
Another way how you can benefit when you register Pte Ltd company in SG is support from the government. Singaporean authorities have developed a set of tax incentives and stamped out the capital gains tax to help new private limited companies to grow. If you opt for the Singapore Private Limited Company set up, we will guide you through every incorporation milestone to ensure your new company is going to reap the maximum of benefits.
How to Set up Pte Ltd Company in Singapore?
Registration of private limited company in Singapore will be successful and hit the target if an entrepreneur considers some key factors and meets the basic Pte Ltd requirements:
- You have to be no younger than 18 YO in order to take part in the incorporation of private limited company in Singapore.
- Maximum number of shareholders for the Pte Ltd is 50; the minimum is 1. The paid-up capital has no limits, but it mustn’t be less than 1 Singaporean dollar.
- Company must have its unique business name that corresponds with the business’ philosophy and doesn’t sound indecent or similar to any other existing Singaporean firm’s name. This name must be selected before starting the business registration procedure. We will help you to secure the chosen name by reserving it for the required period of time.
- Opening Private Limited company Singapore requires having at least 1 local appointed director. You can select among adult (older than 18) Singaporeans or permanent residents. If finding such person is challenging for you, we will offer you one of our reliable candidates. You will be responsible for making all crucial decisions and run your Singaporean business from abroad, but when you need to concentrate more power in your hands, you will need either the EntrePass or the Employment Pass for arriving in Singapore and substituting the local director.
- During the first half a year after the Private Limited Company incorporation Singapore, the firm must appoint a Singaporean secretary (local). We will help you to appoint this professional.
- Your new business in SG must be registered on a real local address.
- Some kinds of businesses require mandatory auditing. You can learn your individual requirements from our incorporation experts.
- Some business niches (like financial sector) are closed for registration before getting a special approval from the government. We will assess your case and help with getting the approval if needed.
- Getting a visa to Singapore isn’t required for the registration of the offshore company unless you aim at leading your company from inside. EntrePass allows you to arrive in the country before the company registration or within 6 months after it; however, obtaining this visa requires fulfilling lots of challenging criteria and commitment. In contrast to that, the Employment Pass is much easier to obtain, but the director must be hired by his own firm based on certain conditions. If shifting to Singapore isn’t in your plans, you can just remain the business owner, run it from abroad and visit the country briefly using an appropriate short-term visa to SG.
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Advantages of Setting up Private Limited Company in Singapore
- Private Limited means that shares are concentrated in private hands and that these shares act as a limit for the company owner(s)’ liability. The firm answers with its shares for all its risky activity: incurring debts, going law, buying property, concluding contracts and so on. Pte Ltd has its separate legal liability, and in case of legal prosecution or debts, shareholders risk nothing except the money they contributed into the shares in the very beginning.
- Registering your future firm as the Pte Ltd, you leave its business structure flexible: the firm continues to exist even after its owner dies, resigns or becomes insolvent. The firm can be sold through selling its shares (partially or wholly).
- Pte Ltd can involve new investors by issuing new shares (this can be done throughout the whole company’s activity).
- Bankers and investors prefer dealing with private limited companies that are aimed at international expansion. As such firms have an “autonomous” liability, they risk less by investing or giving loans to such company. If your business plan contains involving funds from outside, boost your credibility by registering your firm as the Pte Ltd.
- Pte Ltd means an appealing image for clients as well. As soon as your company strives to growth and development, you gain more loyal clients or suppliers who prefer constancy.
- If you register a Singapore private limited company, you can use the local tax policy to your advantage: the government lowers the corporate tax rate to 8.5% (from regular 17%) for the first 300K SGD of the firm’s income. Another tax benefit is that after the company pays the corporate tax, its owner(s) doesn’t have to pay the income tax.
- You can relocate your key staff from abroad using appropriate work visas.
Required Documents for Setting up Private Limited Company in Singapore
Registration at the ACRA requires the business owner to provide such data:
- Name of the company (should be checked beforehand)
- Short overview of the planned business activity
- Detailed information about the company’s shareholders
- Detailed information about the directors – 1 local and foreigners
- Detailed information about the secretary (local)
- Company’s registered address
- Standard MAA (Memorandum & Articles of Association) document
Unless the documents you hold are in English, you must make professional translations and get them endorsed before submission. The paperwork for the SG Private Limited Company incorporation requires knowledge of government’s demands and is quite time-consuming. As you can see, it is associated with the name check, appointing local representatives and workers, and address registration, and, therefore, it is better to get the whole paperwork done by the same company that shoulders your incorporation. To enable us to assess your case deliberately and prepare the required package of papers, you need to provide us with such data about yourself:
- Shareholder who is a corporate body is asked to provide this company’s registration documentation.
- Singaporeans/PRs must provide copies of their ID cards.
- Foreigners must provide copies of their passports, proofs of the foreign registration, latest bank statements, and other personal and business information.
After you entrust us with your idea, you can sit back and wait for your new Singaporean company to be incorporated accurately according to your business needs and the government’s rules.
To open a Pte Ltd company Singapore, the foreigners will need to enlist a professional incorporation service as the local laws and regulations don’t allow foreigners to the registration backstage directly. We will give you the understanding how to register a private company in Singapore and instruct on every milestone of the incorporation scheme.
Incorporation in Singapore is famous for its streamlined company setup procedure: you can have your business registered in 1 single day. Nevertheless, despite the velocity of the registration itself, there are lots of criteria that must be fulfilled before. Here is the approximate list of steps we should make for a successful company registration:
- Checking and reserving the name for the Pte Ltd using the Company Registrar (reservation is valid during 60 days).
- Getting approval from authorities for specific types of businesses
- Finding Singaporean directors & a secretary
- Getting the Singaporean address
- Developing the visa strategy for the relocation of the business owner, key staff, and their families
- Registration procedure at the authorities (ACRA)
After we finalize your Pte Ltd registration, you receive the company registration number by email which is your major incorporation document in Singapore (the country doesn’t use hard copies as all business regulations are computerized here, but you can get the hard copy as well by making an inquiry).
After your new SG-based firm is already registered, we will assist you in creating a bank account in the country, getting your business licenses (we will tell you if you need to have them), and registering for paying the value-added tax (needed if your expected turnover will reach 1M SGD).
Our full Private Limited Company registration service includes leading you through all these steps. You mustn’t be physically present in SG during the incorporation. After you bring your business idea to us, we will assess your case, develop a strategy, and shoulder the registration in the most effective way.
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Singapore Pte Ltd Company Registration Processing Time
After the basic preparations for the Private Limited Company Singapore registration are made, the registration itself takes a day or two. Due to advanced digital technologies adopted in the Company Registrar, you don’t have to wait in a long queue and suffer from the red tape headache. The whole procedure (from the first free assessment to paperwork to appointing directors and a secretary to getting the official incorporation certificate) would take us no longer than 10 days. If you want to enjoy the business result without going through all administrative hassles, entrust us with your new SG-based company registration!
Taxation Benefits of Private Limited Company in Singapore
Singapore has one of the lowest corporate taxes on our planet – 17%. What is more, private limited companies as the most desirable incorporated bodies for the government are pampered with unparalleled tax incentives:
- Pte Ltds are freed from paying taxes for the first 100k SGD of income and get the capital tax halved (8.5%) for the next 200k SGD.
- Singapore doesn’t impose the gain tax if the company has already paid its corporate tax.
- If your new SG-based firm’s expected turnover is more than 1M SGD, you will have to pay the value-added tax (7%) which you have to add to your goods’ cost.
Difference between Company Types in Singapore
Not all business forms are interchangeable in Singapore, and only the Pte Ltd contains the most beneficial features. It ideally fits undertakings that strive for freedom, flexibility, growth, and tax benefits. If you need to set up a firm where the major part of the shares will belong to one holder, opt for the Subsidiary: except this feature, this limited liability business form has the same benefits as the Pte Ltd.
If you need to spread your foreign company’s presence to Singapore, you can choose either the Branch Office (if you the company gets involved in gaining profits) or the Representative Office (for non-profit business activities).
Singapore Pte Ltd Companies Annual Filing Requirements
Not depending on whether your company is active or not, you must get your financial accounts filed according to the standards of Singapore financial reporting. Small companies with scarce documentation can make the bookkeeping once a year, while medium and large companies with huge pile of documentation every month are recommended to make the bookkeeping on a month basis in order not to get overloaded and miss the deadlines. Here are some rules of such annual filing:
- Pte Ltd is required to file its revenue and expected chargeable income: no later than 3 months after your firm’s financial year expires, file the ECI form with the IRAS. You need to do so even if your profit or ECI is zero.
- Annual auditing is needed if at least one of the company’s shareholders is a corporate body or if the firm’s annual income reaches 5M SGD.
- Company must organize annual general meetings and get its annual return filed no later than 1 month after such meeting (please reach out to our Singapore incorporation consultants to find out your specific requirements for such meetings and AR filing).
- Mind filing your tax return yearly until the end of every November based on the profits you got in the financial year that ends in the preceding one.
Foreign entrepreneurs may face misunderstandings while dealing with the Singapore tax system despite its effectiveness and simplicity. It is a normal situation. Please refer to our experienced tax specialists for a consultancy. Our competent advice will help you to outline your tax picture and grasp the principles of business success in Singapore.