Is director responsible for company debt
If you are engaged as company director services , you must wondering ” Will i liable for the company liabilities / debt ?”
You may argue that Pte Ltd is carry separate legal entity concept, so i free from all the company’s liabilities.
But there is always exemption scenario :
When the director acting as Personal Guarantor
Maybe company still “young” in market and bank have no confident on financial status of the company. So being company director you may required by the board to have this additional role.
So, proceed only if you have confident , if not your personal asset may be affected .
When creditor apply to court for director’s responsible of debt
This action is called ” piercing the corporate veil” . And by doing this means company no longer separate legal entity .
Abuse of company vehicle
Because Pte Ltd is carry ” separate legal entity” principal, which means all liabilities is on company and NO personal asset will be affected .
Someone may incorporate company with the intend to making profit by breached the law.
As long as court prove that incorporation of pte ltd with the intent to defraud public to avoid legal liabilities then the relevant director will need to bear the debt.
Misuse of Company fund
Although is Company director who should run the company but certain business transaction still required consent form the board or shareholder .
Without notify the rest, withdrawn the company fund on their owned decision and benefit .