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Private Limited Company
A Private Limited Company is the most popular form of business structure in Singapore for both foreign and local companies. This is largely due to the flexibility offered to business owners. Foreigners can operate a Private Limited Company as a 100% foreign owned entity and also enjoy relaxed tax responsibilities.
What is a Private Limited Company in Singapore?
Private Limited Companies in Singapore are limited by shares and are therefore considered separate legal and taxable entities. This means that the shareholders are not liable for any debts and losses incurred by the company (beyond the value of any share capital they each own).
Private Limited Companies in Singapore are usually required to have one of the following, “Private Limited”, “Pte Ltd” or “Ltd” as part of their company name.
All companies in Singapore are required to be registered with the Accounting and Corporate Regulatory Authority (ACRA). Failure to register with ACRA means that you cannot operate in Singapore.
The key features of a Private Limited Company are:
- Private Limited companies require a minimum of 1 and a maximum of 50 shareholders.
- The liability of each of the shareholders is limited to the value of their shares.
- Profits are taxed at corporate tax rates and dividends are tax-free for shareholders. Additionally, the tax rate for the first S$300,000 of annual profit is set at 8.5% and 17% thereafter. Additionally, all newly incorporated companies are entitled to tax incentives and exemptions regardless of the type of ownership.
- A popular choice for establishing a presence before expanding/investing in the rest of Asia.
• Foreign ownership
100% foreign ownership is possible.
• Local director
Limited Companies must have at least one Resident Director in Singapore.
This Director could be:
- a Singapore citizen,
- Singapore permanent resident,
- EntrePass or employment pass (EP) holder,
- and not already be a director of another company in Singapore.
After this has been satisfied, you can then appoint non-resident directors of the company.
• Limited liability
This type of company structure is a standalone legal identity, therefore, shareholders are not liable for the debts and losses incurred by the company.
• Minimum Capital Requirements
Paid-up capital can be as little as S$1. The capital can be issued in USD and other currencies
• Business Restrictions
There are some business activities that may require a special license:
- Restaurants
- Financial services
- Travel agencies
- Educational institutes
- Import & export of goods
- Recruitment agency
- Crypto related activities
• Hiring of Foreign employees
Foreign employees in Singapore must obtain an Employment Pass
Pricing
FROM
USD 800 *
1 business day
(Average time from the moment
we receive complete information from you)
* + Government Fees: USD 315
Application handled by a corporate expert.Scope of work
- Assistance in the pre-registration procedures. This includes drafting and filing the Memorandum of Association and registering the company name.
- Prepare and file all registration documents with ACRA. This includes collecting and collating the required documents.
- Compiling the company business profile and relevant post registration compliance.
- Answering questions in relation to the process for setting up a Private Limited Company.
- Advising you on the post registration duties to ensure a smooth business operation.
Need more?
Additional services that you may need as well
- Corporate secretary fee: USD 800 per year (mandatory)
- Registered address: USD 400 per year
- Local nominee director: 2,500 USD per year plus 2,500 USD deposit
- Assistance with the opening of bank account (free with our digital bank partner), 1,000 USD with a traditional bank
- Drafting a Shareholder Agreement: From USD 2,500
- Preparing ESOP Plan: From USD 1,000
What is the process for registering a Private Limited Company?
Be prepared for registering your Private Limited Company with our comprehensive and free registration checklist.
Be prepared for registering your Private Limited Company
with our comprehensive and free registration checklist.
Pre-registration requirements
Our experts can assist you with the initial steps for registering your Private Limited Company. This includes:
- Identifying the correct company structure that best fits your needs.
- Preparing the company constitution e.g. Articles of Associations
TIMELINE
1 to 5 business days
Collecting KYC documents and filing the application
Our team of experts will collect, collate and fill in all the required documents, ready for your signature.
TIMELINE
A few days to collect documents from the parties and prepare the application
Registration of the Private Limited Company
Our team of experts will file all the documents and application forms with ACRA.
TIMELINE
1 to 2 business days
Post-registration requirements
Our experts can assist with you the next necessary steps to start your business:
- Corporate secretary fee: USD 800 per year (mandatory)
- Registered address: USD 400 per year
- Local nominee director: 2,500 USD per year plus 2,500 USD deposit
- Assistance with the opening of bank account (free with our digital bank partner), 1,000 USD with a traditional bank
- Drafting a Shareholder Agreement: From USD 2,500
- Preparing ESOP Plan: From USD 1,000
Frequently asked questions
What is the minimum capital to register a company?
The minimum share capital for a Singaporean company is SGD 1, however, higher share capital will be necessary depending on if the company is considering hiring a foreign employee under an Employment Pass. In order for the company to sponsor the EP, an initial capital of SGD 50,000 will be required.
Shareholders’ liability is limited to the amount of share capital. The number of shareholders required is a minimum of 1 up to 50.
What are the yearly compliance procedures for Limited Companies in Singapore?
The companies shall on an annual basis:
- Prepare and file a corporate tax return for tax purposes;
- Prepare and file an Annual General Meeting and an Annual Return reporting any changes in their particulars (i.e. change of registered address, new company secretary, share capital increase, new shareholders, etc.).
- There is an audit exemption, for companies with a turnover of less than SGD 10 million and whose shareholders are only natural persons; and for dormant companies.
Corporate Income Tax in Singapore
Any income generated in Singapore is subject to Singapore tax. As a result, a resident company is taxed on its Singapore source income and any foreign income that is remitted into Singapore.
The standard corporate tax rate is 17% of taxable income. However, corporate profits are partially exempted as below:
- 75% exemption applicable to the first SGD 100,000; then
- 50% exemption for the following SGD 190,000.
Under the Tax exemption scheme for new start-up, the eligible companies may benefit of partial exemption as below:
- 75% exemption applicable to the first SGD 100,000; then
- 50% exemption for the following SGD 100,000.
All new resident companies incorporated in Singapore are eligble for the partial tax exemption (except whose principal activity is of investment holding, property development for sale or for investment) where the total share capital is held directly by no more than 20 shareholders and where:
- All of the shareholders are individuals; or
- At least one shareholder is ana individual holding at least 10% of the shares.
In application of the Corporate Income Tax Rebate, the company will also benefit from a deduction of 25% of its tax due, after application of the above exemptions, up to a limit of SGD 15,000 per fiscal year.
Dividends are not taxed when distributed to a Singapore resident or non-resident shareholder.
How many directors are required in a Private Limited Company?
Under Singapore Law, a Private Limited Company is required to have at least one Resident Director in Singapore.
A Resident Director can be one of the following:
- A Singapore citizen,
- A permanent resident of Singapore,
- A EntrePass or employment pass (EP) holder,
- and not be already director of another company in SG.
After the appointment of a Resident Director, you can appoint non-resident directors of the company.
How many shareholders are required in a Private Limited Company?
A Private Limited Company is required to have a minimum of 1 shareholder and a maximum of 50.
Do I need a Singaporean partner to register a Private Limited Company?
No, Private Limited Companies in Singapore can be 100% foreign owned.
Can I open a corporate bank account and are there any restrictions?
Any registered company in Singapore may open a corporate bank account with internet banking.
Question Before You Begin? *
Question Before You Begin? *
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(*) This Conversation is intended to provide basic answers to questions you may have about the Private Limited Company. But it is not a Lawyer’s Consultation. Learn more.
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