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Incorporation of a
Private Limited Company
Why Incorporate?
Benefits of incorporating
Other Information
Avoid being personally liable for debts and lawsuits.
A company is a totally separate legal entity from any individual. In the legal sense, it is the company not the shareholders or the company officer that enters into a business transaction and is responsible for the outcome. As such, incorporating a company helps separate your personal assets from that of your business. In the event of a lawsuit or if your business should fail, no one can seize your personal assets, your home, car, bank accounts, etc. Your exposure as a shareholder to the company will be limited to the amount of the initial investment that you have invested.
In a sole proprietorship or partnership, on the other hand, the individual or partners are personally liable for all business debts or lawsuits.
Add credibility and stature to your business
A Private Limited structure gives credibility and stature in the eyes of the general public and also to your customers and suppliers than a Sole-Proprietorship or Partnership. An incorporated company gives the perception to your bankers, customers, suppliers, and other business associates about your commitment to the ongoing success of your venture.
Tax benefits and incentives
To encourage entrepreneurs who start up new companies, qualifying new companies will now enjoy full tax exemption on the first $100,000 of their tax profit annually for the first 3 years from incorporation. That?s potentially tax savings of S$54,000 for 3 years. Current corporate tax rate is 18%.
This scheme will enable new companies to retain a larger portion of their earnings to be ploughed back into their businesses. In addition, a host of tax schemes and incentives are in place to help companies grow their businesses. These incentives are not available to other types of entities such as sole proprietorship, partnership or Limited Liability Partnerships (LLPs)
Incoporation Requirements & Procedures
To incorporate a private limited company, you need the following:
- Issued Share Capital
Minimum issued share capital is one share of S$1 each.
- Registered Office
Companies are no allowed to use P.O Boxes as a registered office address. HDB flats are not allowed to be used as a registered office address of your company without prior permission from Housing & Development Board (HDB). If you do not have any address appropriate as a registered office address for your company, you may use our registered office facilities.
- Directors
A minimum of one director, who must be a Singapore resident individual.i.e. a Singapore Citizen, a Singapore Permanent Resident or a person who has been issued an Employment Pass/Approval-In-Principle letter/ Dependant's Pass. Any person above the age of 21 years may be appointed as a director. However, some individuals e.g. bankrupts, are disqualified from being directors. We provide nominee director to facilitate the incorporation.
- Company Secretary
Companies are required to appoint a resident company secretary. Our corporate secretary service provides a Chartered Secretary(SAICSA) as the company secretary for your company.
- Shareholders
A minimum of one shareholder is required. Shareholders may be local or foreign corporations or individuals. With the exception of certain companies, e.g. companies who own residential properties, otherwise all shares may be own by foreigners.
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