Ensuring compliance is essential for all companies, not just the ones listed on the stock exchange. The corporate environment is constantly evolving, making the challenges of corporate governance in the privately held business sector greater than ever.
Private companies that keep up with their compliance obligations often benefit from improved performance and are able to better control procedures and processes in their business.
If you are interested in incorporating a Private Limited Company, here are some important things that you should know to set your company up for success.
1. What are some of the key requirements to set up a Private Limited company in Singapore?
The 5 key requirements to set up a Private Limited Company in Singapore are as follows:
- At least 1 resident director who is a Singapore Citizen or Singapore Permanent Resident or Work Pass Holder
- At least 1 Shareholder with no local shareholding requirement (i.e., can be 100% foreign owned) and the shareholder can be foreign individual or corporation)
- Someone to act as your Company Secretary
- Initial paid-up capital of at least SGD1.00
- A registered office address in Singapore
2. What are the Annual Filing Obligations of a Private Limited Company?
Unless exempted/dispensed, a Private Limited Company is required to hold its annual general meeting to present the financial statements for the concerned financial year to its member(s).
The Annual General Meeting is held within 6 months from the financial year end and the annual return together with the financial statements in XBRL format (unless exempted) should be filed with ACRA within 7 months from the financial year end.
3. What kind of audit requirements does a Private Limited Company have?
Any Private Limited Company defined as a “small company” will not have to conduct an annual audit of its financial statements.
Below are the quantitative criteria of determining the concept of a “small company” and the Private Limited Company will have to satisfy any 2 of the following 3 criteria:
- The total annual revenue of the company must not exceed S$ 10 million;
- The total assets of the company for the financial year end must not exceed S$ 10 million; or
- The number of full-time employees at the end of the financial year must not exceed 50.
The assessment periods are different for newly incorporated companies and existing companies. Consult us to find out more.
4. How do you maintain the Register of Registrable Controllers (RORC) as a Private Limited Company?
Unless exempted, all Private Limited Companies must keep a register of registrable controller ( “RORC” ) and register of nominee director (“ROND”) not later than 30 days after the date of the company’s incorporation at their registered office address or the registered office address of their appointed Registered Filing Agents (RFAs).
You are also required to lodge the RORC information with ACRA.
On an annual basis, you must minimally send out a RORC notice to each member and each director.
5. Have you heard about the CorpPass Administration?
CorpPass is a corporate digital identity for businesses and other entities (such as non-profit organisations and associations) to transact with Government agencies online. CorpPass is now the only login method for online corporate transactions with more than 140 government digital services and therefore is needed for every Singapore company.
You will have to appoint a CorpPass Administrator to manage your CorpPass account which includes creation of users/sub-admins at your requests, assignment of the relevant government access to the relevant users, termination of users etc.
6. Private Limited Companies are no longer required to use a common seal in Singapore
A Private Limited Company is no longer required to use the common seal in the execution of documents as a deed, or other documents such as share certificates. These documents can be executed by having them signed by authorised persons as below:
- A director and the secretary of a company:
- Two directors of a company; or
- A director of a company in the presence of a witness who attests the signature
However, you are still encouraged to adopt a common seal as your counterparties in certain jurisdiction may want some important documents to be under seal for added layer of assurance.
7. What requires the Board’s approval in Singapore?
These are some common matters requiring the Board’s approval in Singapore. The decisions can be approved via circularised board resolutions or physical board meetings.
- Appointment of additional director(s)
- Appointment of company secretary
- Appointment of first auditors
- Opening of bank account(s) and bank related matters
- Execution of material agreements/contracts
- Transfer of shares
- Allotment of shares
8. When are Member/Shareholder approvals required?
These are some common matters requiring the Member’s/Shareholder’s approval in Singapore. The decision can be approved via circularised member’s resolutions or general meetings.
- Change of Company Name
- Amendments to the Constitution
- Authority to issue shares
- Share Buy Back
- Capital Reduction
- Change of Auditors
- Removal of Directors
- Disposal of the whole or substantially the whole of the company’s undertaking or property.
How can we help
Meeting regulatory, legal and entity governance obligations is an increasingly important and time-consuming task. At Mazars, our outsourcing team can manage all your compliance milestones and allow your team to focus on their core duties.
To learn more about setting up a Private Limited Company and its compliance obligations, contact us today.