Category: Company Registration Guide

TYPE OF BUSINESS VEHICLE

Keen to join Singapore Entrepreneurship ? here is the list of business vehicle option .

OPTION 1 : PTE LTD

According to the ACRA records, Pte Ltd is the top choice for public among others option .

  • carry separate legal entity concept which means that it can stand alone and separate from its director and shareholder
  • It have capacity to enter into contract, acquire asset and sue or been sue under its own name
  • Ease of Ownership transfer via share transfer. You are allowed to transfer your shares without operation disruption ( depend on your agreement with the company )
  • Ease of share transfer help company continue to exist even in the event of death, change in director or shareholder .

OPTION 2 : SOLE PROPRIETOR

Sole proprietor is easy to setup compare with Pte Ltd . As it doesnot required director and shareholder role , less compliance regulation .

  • is risk type of option because is not a separate legal company therefor its owner will personal responsible for any debt of the company . Owner Personal asset is NOT protected
  • it will cease operation if owner cease operate of in the event of death
  • Will be tax at personal tax level

OPTION 3 : PARTNERSHIP

Partnership refer to 2 or more people agreed to establish and co own a business .

  • NOT separate legal entity so all partner asset is NOT protected
  • It cease exist in the event of death partner
  • disatisfied among partner will casue dissoluiton of the partnership

There is 3 type of partnership

  1. General Partnership
  2. Limited Partnership
  3. Limited Liabilities Partnership

HOW TO DECIDE ?

Key consideration :

If you are local and intent to start small business then Sole Proprietorship is your preference .

If involved with different people carry different role in company, then you may consider Partnership. But please take note of its Perpetual succession.

Lastly, Pte Ltd still great choice among all with the separate legal entity concept . The only drawback is needed of compliance regulation.

What is SSIC code

WHAT IS SSIC CODE ?

Singapore Standard Industrial Classification ( SSIC) code refer to type of principal activities for the company .

And you are required to key in upto 2 major SSIC code for your company .

WHY SSIC CODE IS IMPORTANT ?

  • As a reference key for all agent to run their role :

MOM – Based on SSIC code to determine number of foreign worker allowed to engaged

IRAS : Based on SSIC code to determine tax level / tax benefit

Government Grant – Based on SSIC code for grant given

  • As a reference key for business license requirement .

You may request to apply for business license from the following agency before start of relevant business activity :

  • Council for Estate Agencies (CEA)
  • Ministry of Education (MOE)
  • Monetary Authority of Singapore (MAS) etc

HOW MANY SSIC CODE CAN COMPANY HAVE ?

At least 1 and maximum 2

CAN I CHANGE SSIC CODE ?

Yes

HOW TO FIND SSIC CODE LIST ?

Click here and type in keyword .

HOW TO CHECK OTHER COMPANY’ S SSIC CODE ?

  • WITH CORPPASS LOGIN

You may check via filing of annual return link

You may purchase business profile

  • WITHOUT CORPPASS LOG IN

visit www.bizfile.gov.sg as follow :

What is par value of shares ?

WHAT IS PAR VALUE ?

Par value also knows as Nominal Value

APPLICABLE IN SINGAPORE ?

NO, it been abolished since 2006

WHAT HAPPEN TO SINGAPORE REGISTERED COMPANY ?

You are only required to declare 3 important figure as follow :

Example :

Number of issued share shown the ownership level in the Company

Amount of issued share Capital shown the total capital of the Company

Amount of Paid Up share Capital shown the total agreed amount paid

What you should know After Company Registration

UNIQUE ENTITY NUMBER (UEN)

Each Company will be issued with UEN upon successfully incorporation.

Public is allowed to choose their own UEN with certain amount of fees .

Related Article : What is UEN

WHY IMPORTANT :

This UEN number is like birth certificate number , it used to identify Each Company .

DATE OF INCORPORATION (DOI)

DOI is the only date you can decide.

You are NOT allow to backdate or future date of the DOI.

WHY IMPORTANT :

As a guideline to fixed the financial year end date and calculate the compliance deadline with authorities.

COMPANY CONSTITUTION

You are allowed to draft owned copy of Constitution or used ACRA copy of constitution.

WHY IMPORTANT

Company constitution is a set of regulation stated regulation needed to comply with while running the company.

Related Article : What is Company Constitution

FINANCIAL YEAR END

Financial year end date is refer to accounting closure date .

It will used as reference date to determine the company filing due date with ACRA ( example AGM must be conducting within 6 months from the financial year end date )

Related Article : How to fixed financial year end

WHY IMPORTANT :

If your company business dealing with Christmas season product is good that financial year ended fixed on January of next year .

PRINCIPAL ACTIVITIES (SSIC CODE )

Every Company is required to key in at least 1 major principal activity.

WHY IMPORTANT :

Because SSIC code may have impact on quota to employ foreign worker and requirement application of business license .

What is the Effect of Company Incorporation

After successfully incorporation with ACRA , Company become legal business vehicle to join business landscape.

What is the effect for being Company?

SEPARATE LEGAL ENTITY CONCEPT

Company carry concept of SEPARATE LEGAL ENTITY between company and its shareholder .

Which means that Company is able to stand alone in the eyes of law .

ABILITY TO OWN PROPERTY

Because of the Separate legal Entity concept, Company is free to own property for own used or as investment .

ABILITY TO SUE AND BE SUED UNDER COMPANY NAME

Since company carry separate legal entity, so it responsible for it own act .

Any wrong done to the Company, only Company itself can take action

Shareholder liabilities or risk taken up to the amount of their invested into the company.

PERPETUAL SUCCESSION

Company shall exist until application to close is done and approved by ACRA .

Company’s life span does not depend on the officer or shareholder of the Company .

Unlike sole proprietor , where exist of owner means that cease of the business

How to Verify a Company Status in Singapore

There always a risk regardless where you business transaction conducting.

And the most common is phantom company. So, is good that company take further step to check before enter into contract .

Check Pte ltd company for FREE

  • visit www.bizfile.gov.sg and type company name as follow :

RESULT : Live company means that the company is still active

RESULT : Struck off means company is close and NO right to engage with any business activities

OR you may purchase CERTIFICATE OF GOOD STANDING (S$11)

Company Registration With Employment Pass

WHO IS EMPLOYMENT PASS HOLDER (EP)

  • EP is type of working pass means for foreigner whose monthly earning income is  S$4,500 with effect from 01 September .
  • EP is govern by MOM regulation

CAN EP BECOME COMPANY DIRECTOR

  • YES, but for his Employer Company or its relevant Company ONLY

IS EP CONSIDER LOCAL RESIDENTIAL DIRECTOR

  • YES. EP director is consider comply with Companies Act requirement “ Every company must have at least 1 local director

VALIDATION OF EP

  • 2 years

IS RENEWABLE   

  • YES, subject to MOM approval

CAN THE EP HOLDER BECOME DIRECTOR OF SUBSIDIARY COMPANY     

HOW TO EP TAKEN 2ND DIRECTORSHIP

  • Please click here for the procedure

CAN EP HOLDER RECEIVE DIRECTOR FEES

  • YES

IF MOM NOT RENEW MY EP, CAN I STILL BE DIRECTOR

  • YES, you may be foreign director via capacity of passport

CAN EP BECOME SHAREHOLDER OF THE COMPANY

  • Yes

Latest related News :

Change in application EP with effect from 01.09.2020

Type of Company shares

WHAT IS SHARE

Share refer to ownership in the Company .

TYPE OF SHARES

Ordinary Shares

Is the most common share in Singapore registered company .

In general, 1 ordinary share represent 1 vote .

Ordinary shareholder eligible for the right for dividend and right to claim the remaining assets when the company is wound up .

Some of the company may divide ordinary share into different class of share ( Class A , B , C)

Different class of ordinary share may represent different right .

Preference Shares

Preference shareholder ‘s right is over ordinary shareholder in term of dividend distribution and claim of company assets.

In most cases, preference shareholder have NO voting right .

BASIC RIGHT ATTACHED TO SHARES

  • Voting right
  • Right to call for meeting
  • right to attend meeting
  • right for the distribution of dividend

DOCUMENTS DETERMINE SHAREHOLDER RIGHT

Company constitution or shareholder agreement is the documents to list down shareholder right .

Related article : What is Shareholder Agreement

Related article : What is Company Constitution

CONSIDERATION TO DETERMINE TYPES OF SHARES

  • shareholder responsible level in the Company
  • who is shareholder ( founder / Employee / Investor)
  • Invested Amount into the company
  • shareholder relation level with the company business activities

Company Registration Part II :Basic Guideline for foreigner

Document Needed for Director

  • Passport
  • Supporting documents for residential address
  • Contact detail : email address and phone number

Document Needed for Shareholder ( Individual )

  • Passport
  • Supporting documents for residential address
  • Contact detail : Email address and phone number

Document Needed for Shareholder ( Corporate )

For a Company to be shareholder for Singapore registered company .The following is required :

  • Certificate of Incorporation from authorities body
  • Company structure include list of director and shareholder
  • Company principal activities
  • Company total paid up
  • Company key personal contact detail

Principal Activities

Company is required to choose 2 principal activities . Please click here for the list

Registered Address

  • Only commercial property is allowed to be used as registered address .
  • PO Box is not allowed to be used as registered address
  • And certain business is allowed to use HDB as registered address with the approval of HDB board .

Paid Up Capital /Share Capital

Paid up refer to the total investment fund into Company.

Related Article : What is paid up Capital

Nominee Director Agreement

Nominee Director agreement is between appointed Nominee Director and the company. It standard content should include :

  • particular detail of the appointed Nominee Director include copy of NRIC, residential address and contact detail
  • period or validation of the agreement
  • agreed Nominee Director fees
  • detail duties of the Nominee director example some company may NOT allowed nominee director involve in bank transaction

Company Constitution

Company constitution formerly known as Memorandum and Article of Association . Is a legal document must sign by shareholder before company registration

You may draft your owned Company Constitution or used ACRA standard copy of constitution .

Related Article ; What is Company Constitution

Shareholder Agreement

This is the optional document.

Related Article : what is shareholder Agreement

First financial statement of newly company

Every Pte Ltd company is required to submit their financial statement to IRAS and ACRA annually (except certain company which able to meet exemption creteria)

WHAT IS FINANCIAL STATEMENT

Presentation of Financial report is governed by Singapore Financial Reporting Standards (SFRS)

According to the SFRS, a complete compilation of financial statements should comprise the following documents. :

  • A statement of financial position / Balance sheet
  • A statement of comprehensive income
  • A statement of changes in equity
  • A statement of cash flows

WHEN TO SUBMIT FIRST SET OF FINANCIAL STATEMENT TO ACRA

Submission of financial statement can proceed only after shareholder approval during Annual General Meeting (AGM)

All company is required to submit their financial report via Annual Return (AR) with ACRA .

When to submit 1st set of financial statement is determine by when is the financial year end date .

All newly registered Company is required to fixed their financial year end within 12 months from the date of incorporation .( for the special financial period other than 12 months is subject to ACRA approval )

WHEN TO SUBMIT FIRST SET FINANCIAL STATEMENT TO IRAS

In compliance with IRAS, public will need to declare company tax via Form C / Form CS .

All the detail requested information must based on financial statement and physical copy of financial statement presented upon requested only.

What is Form C

What is Form CS

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