Skip to main content Skip to search

Archives for Secretary

Shareholder Agreement

Shareholder Agreement

The company’s constitution is regarded as a statutory contract as between the shareholders. It is common in practice for the shareholders to supplement the constitution with a separate agreement setting out their rights and obligations prior to or subsequent to incorporating a company to conduct their business. These agreements are often comprehensive and deal with rights and obligations that are additional to those mentioned in the company’s constitution. Such an agreement is usually referred to as a “shareholder agreement”. The shareholder agreement may be between:

  • the company and its members,
  • all the members as amongst themselves, or
  • select members as amongst themselves

There is no fixed rule on the scope of a shareholder agreement. The parties of the shareholder agreement have the freedom to determine what the agreement covers based on their needs. As such, some companies have a simple and streamlined agreement, while others may have a comprehensive agreement with very detailed terms on every aspect of the company’s operations. Generally, a well-drafted shareholder agreement will cover  (but not limited to) the following aspects:

  • Management of the company
    • Who will exercise the management functions of the company?
    • The mechanism for which certain decisions is made (e.g. unanimous approval / approval of a specified percentage) to protect the interests of minor shareholders who can potentially be out-voted.
  • Dispute/Deadlock Resolution
    • In the unfortunate event that dispute/deadlock arises between shareholders, and they are unable to work together anymore, the shareholder agreement can minimise the time and costs of the dispute by dictating who should leave, price of his/her shares and when the sale will take effect.
  • Exit strategy
    • How can the shareholders sell their shares and how will the shares be valued?
  • Disability / death of shareholder
    • In the event that a shareholder is disabled, will the company continue to pay a full/reduced salary and for how long? Will the disabled shareholder be required to sell his shares?
    • In the event that a shareholder passes away, how will his/her next-of-kin be compensated for the deceased’s interest in the business?
  • Non-competition provision
    • This will protect the company’s interest by ensuring that the company’s confidential information is preserved and founders are restricted from leaving to join/ start a competitor.
  • Return of investment
    • What is the company’s dividend policy?

What is the difference between the “statutory” contract and a “shareholder agreement” 1 ?

The statutory contract created by a company’s constitution is distinct and separate from any shareholders’ agreement between the parties. The result is that there may be two contracts governing the relationship between the parties. Both contracts are equally binding and have their own legal force. Where there are conflicting provisions on both documents, it is suggested that the conflict will have to be resolved using general principles of interpretation under contract law to see which should take precedence. This flows from the use of general contractual rules of interpretation in construing corporate constitutional documents by the courts.

There are two key differences between the constitution and a shareholder agreement.

First, the rights and obligations of the statutory contract are inextricably intertwined with membership of the company. A party who ceases to be a member also ceases to be a party to the statutory contract. Conversely, new members who join the company are regarded as parties to the statutory contract. The rights and obligations in a shareholder agreement are personal to the original parties to the agreement and can only be assigned (transferred) pursuant to the rules in contract law.

Secondly, the statutory contract can be amended so long as the procedures for amending of the company’s constitution have been complied with. Under most circumstances, there is no need to obtain the agreement of all the parties involved to the statutory contract to agree to this but only a requisite majority. In contrast, all parties to the shareholder agreement must agree for any amendment to the agreement to take effect.

_________________________

1 Yeo, Victor C.S.,  Lee, J., Hanrahan, P., Ramsay I., Stapledon, G. (2015). Commercial Applications of Company Law in Singapore (5th Edition), 5-420.

Read more

Certificate of Incorporation

Certificate of Incorporation (Sample)

A Certificate of Incorporation is a legal document issued by the Accounting and Corporate Regulatory Authority (“ACRA”) and it serves to certify that an entity is registered in Singapore under the applicable Act. It contains the company’s name, registration number, date of incorporation and the company’s former names (if applicable).

This certificate is not issued at time of incorporation but can be conveniently purchased via ACRA BizFile+ portal whenever required by the business owners. The steps to purchase the Certificate of Incorporation are as follows:

  • Visit ACRA BizFile+ portal at www.bizfile.gov.sg
  • Login with SingPass or CorpPass (Login is required. Otherwise, the option to purchase Certificate of Incorporation will not be shown. Login button is located on the top right corner of bizfile home page.)
  • Select “Buy information” tab followed by “Other Information” and “Certificates”
  • Type business registration number in “Entity Search” box
  • Fill in Captcha
  • Click on buy information link
  • Choose “Certifcate Confirming Incorporation of Company”.

There are two versions available for purchase (i.e. electronic version and hard copy version) via ACRA BizFile+ portal at a fee of S$50 per report.

The electronic version is generated electronically and does not contain any signature. Upon successful payment, the electronic version of the certificate can be downloaded from the link provided in the email available under “Messages” in the ACRA BizFile+ portal. Alternatively, an email with the link for downloading of the certificate will be sent to you within 30 minutes upon successful payment.

Alternatively, if you require a signed certificate for submission to overseas authority etc., you may purchase the hardcopy version which is duly signed by ACRA. Once purchase has been completed via ACRA BizFile+ portal, the hardcopy certificate will be available for collection at the ACRA reception on the next working day and 24 hours after successful payment. You may also request ACRA to post the certificate to a specified address.

Read more

Business Profile & Business Profile with Certificate of Production

Business Profile

Business Profile Sample

Business Profile is an electronic document issued by Accounting and Corporate Regulatory Authority(“ACRA”) and business owners will need it often for business purposes.

This electronic document summarises basic information available in ACRA’s records about the Singapore-registered entity and bears no signature or stamp of ACRA. Basic information includes registration number, entity name, business activities, date of registration, ownership / directorship details and charge information about the entity as of the date of issuance of the Business Profile. This document is equivalent to the Certificate of Incumbency, Company house data, Master data etc. in other countries. It is also sometimes referred to as ACRA instant printout.

When would I need it?

The Business Profile is a useful document and comes in handy in the following situations (but not limited to):

  • Bank account opening under your business entity’s name
  • Application of business licenses and permits
  • Performing checks on potential business partners
  • Finding out more about a company, sole-proprietorship, partnership, limited liability partnership, limited partnership or public accounting firm / corporation.

Information provided in a Business Profile

Depending on the entity type, the information provided in a Business Profile may differ. Below is the list of information provided in a Business Profile for each entity type:

  1. Sole-proprietorships / Partnerships
  • Name of sole-proprietorship / partnership firm and date of change of name (if applicable)
  • Registration number (UEN)
  • Commencement date, renewal date and expiry date
  • Place of business and date of change of address (if applicable)
  • Status of business and effective date of status
  • Principal activity(ies)
  • Particulars of authorised representative(s), existing owner(s) and withdrawn owner(s)
  1. Limited Liability Partnerships (LLP)
  • Name of LLP and date of change of name (if applicable)
  • Registration number (UEN) and registration date
  • Status of LLP and effective date of status
  • Registered office address and date of change of address (if applicable)
  • Date of annual declaration
  • Principal activity(ies)
  • Particulars of manager(s), existing owner(s), withdrawn owner(s)
  1. Limited Partnerships (LP)
  • Name of LP and date of change of name (if applicable)
  • Registration number (UEN) and registration date
  • Status of LP and effective date of status
  • Commencement date, renewal date and expiry date
  • Registered office address and date of change of address (if applicable)
  • Principal activity(ies)
  • Particulars of existing, withdrawn general partner(s), and limited partner(s)
  1. Companies (e.g. Private Company / Public Company / Foreign Company)
  • Name of company
  • Registration number (UEN)
  • Company type, status, effective date of status and incorporation date
  • Principal activity(ies)
  • Registered office address and date of change of address (if applicable)
  • Capital amount, issued share capital, paid-up share capital
  • Date of last AGM, date of last annual return, date of account laid at last AGM
  • Date of lodgement annual return and account
  • Audit firm details
  • Particulars of officers, shareholders, liquidators, receivers and judicial managers 
  1. Public Accounting Firms / Public Accounting Corporations
  • Name of public accounting firm / corporation and date of change of name (if applicable)
  • Registration number (UEN) and registration date
  • Status and effective date of status
  • Commencement date
  • Registered principal place of business and date of change of address
  • Principal activities
  • Particulars of existing, withdrawn sole-proprietors / partner(s), and managing partner(s)

Information not provided in a Business Profile

However, you may wish to note that the Business Profile does not contain the following information:

  • Other Directorships/shareholding of parties involved
  • Movement/changes in directorship/shareholding
  • Historic details (including previous director/shareholder details)
  • Financial information
  • Commercial litigation of company or its directors/shareholders
  • Other business intelligence information

Cost and how to obtain a Business Profile

The Business Profile costs $5.50 per report and can be purchased conveniently via ACRA BizFile+ portal.  If you have a SingPass, you can login at ACRA BizFile+ portal with your SingPass to make the purchase and download the Business Profile from the link provided in the email available under “Messages”.  Alternatively, if you do not own a SingPass, an email with a URL for downloading of the report will be sent to you. For more information on business profile, please refer to ACRA link here.


Business Profile with Certificate of Production

Another type of business profile is the Business Profile with Certificate of Production. This is an extended version from the earlier one; it consists of a business profile and a certificate of production certified by the Assistant Registrar of ACRA. It has an ACRA stamp, authentication number and an electronic scanned signature on the certificate. This electronic report can be produced in court and to other authorities as documentary proof.

It costs $16.50 per report and can be purchased in the same manner as the Business Profile. For more information on business profile with certificate of production, please refer to ACRA link here.

Read more

Subsidiary Vs Branch Office Vs Representative Office

Singapore RiverSingapore is strategically located between the East and West, providing convenient access to fast-growing markets such as China, India and Southeast Asia. Its strategic location is one of the major advantage of relocating business to Singapore. More than 7,000 multinational corporations (MNCs) have set up here, with more than half of them using Singapore as their regional headquarters. Companies hoping to grow their business will find Singapore as the ideal location to achieve this.

Foreign companies keen on establishing a presence in Singapore may choose to set up a subsidiary company, branch office or a representative office in Singapore. The best option will depend on the company’s business plan and strategic goals. As such, the following guide aims to explain the different setup options for foreign companies and how each option will best suit certain needs.

Subsidiary Company

A subsidiary company is a locally incorporated private limited company and its shareholding may be owned 100% by a foreign company or individual. A subsidiary company is treated as a local resident company and is eligible for tax exemptions and incentives that are available to local companies. In addition, a subsidiary company is considered as a separate entity from the foreign company. As such the parent company’s liability is limited to the share capital invested in the subsidiary company and its own assets cannot be held liable for the debts and liabilities of the subsidiary company. It is also easier to raise funds locally or obtain government incentives.

Due to the above mentioned benefits, registration of a subsidiary company is often preferred by small to mid-size foreign businesses who are keen on setting up an office in Singapore.

The name for the subsidiary office can be different from the parent company and is subjected to approval by the Account and Corporate Regulatory Authority (ACRA). Singapore Companies Act requires the appointment of one or more directors, and one of the directors must be a Singapore resident (citizen, permanent resident or employment pass holder). A subsidiary company also needs to have a registered office address in Singapore and ensure all statutory documents are kept in that office.

Branch Office

A Singapore branch office is a registered legal entity but it is considered an extension of the foreign company. As it is not a separate legal entity from its parent company, its debts and liabilities will have to be borne by the head office of the foreign company. A branch office is generally considered as a non-resident company for tax purposes, as a result it is not eligible for tax exemptions and incentives which may otherwise be available to tax-resident local companies.

Due to its non-resident status for tax purposes, this option is less attractive for small to mid-size foreign businesses. Generally setting up a branch office is for foreign companies which do not want to incorporate a company in Singapore, but would like to register an entity in order to carry out business activities in Singapore legally and under the corporate title of the foreign company.

The name of the Singapore branch office must be the same as that of the parent company and must be approved first before branch office registration. The company registrar generally approves the proposed name unless it is identical to an existing company name or is offensive in nature. Singapore Companies Act requires the appointment of at least 1 authorised representative who is ordinarily a Singapore resident. A branch office also needs to have a registered office address in Singapore

Representative Office

Setting up a representative office is for foreign companies who are interested in conducting market research or administering company affairs without conducting any profit-generating business activities. A representative office is a short-term setup without any legal status and cannot engage in any direct trading or on behalf of the foreign company. As it is not generating revenue, it is not required to submit tax returns in Singapore. It is also not a separate legal entity from its parent company, thus the foreign company will bear all the liability for its activities.

The cost for registering a representative office is considerably lower, making it an ideal avenue for foreign companies to explore potential opportunities in Singapore and the region before making commitments. However, a representative office cannot operate beyond three years. It will have to be converted to a branch office or subsidiary before or at the end of the three years.

Similar to branch office, the name of the Singapore representative office must be the same as that of the parent company. The authorities will decide on a case by case basis for situations where the name is identical to an existing company name. The representative office is required to be staffed by a representative from the foreign company’s head office and may engage up to five employees.

Below is a table summarizing the differences between the three entity types:

Singapore Subsidiary

Singapore Branch

Singapore Representative Office

Entity Name

Need not be the same with that of its parent company but should not be identical or similar to any registered company or business in Singapore.

Need to be the same as that of its parent company.

The name of the RO must correspond to that of its parent entity. IE Singapore must be notified within one month of any change in its name and accompanied by a copy of the parent entity’s certificate of change in name (in English or official English translation). The RO must clearly state that it is a “Representative Office Registered in Singapore” on its name plaque, letterheads, name cards of its staff and other communication materials.

Legal Status

Separate legal entity distinct from its members (parent company) and directors.

Not a separate legal entity but an extension of the parent company registered outside of Singapore.

Has no legal status but just a temporary facility with no statutory obligations to file financial accounts and tax returns with the Accounting and Corporate Regulatory Authority (ACRA) and the Inland Revenue Authority of Singapore (IRAS).

Liabilities

Parent company not liable for debts and losses of Singapore subsidiary.

Debts and losses of Singapore branch are extended to parent company.

Liabilities extend to parent company.

Business Activities

No restrictions on the type of business activities that a company can engage in.

Must be the same as the parent company.

Can only engage in market research and feasibility studies and should not provide services nor render any direct or indirect revenue generation activities on behalf of its parent company.

Continuity in Law

Perpetual succession until wound up or struck off.

Perpetual existence until deregistered.

Can only operate in Singapore for a maximum of three years from the date of its inception. During this period, the Representative Office must also be renewed annually.

Estimated Registration Time

1 day
It may take between 14 days to 2 months if the application needs to be referred to another agency for approval or review. For example, if the intention of the company is to carry out activities involving the setting up of a private school, the application will be referred to the Ministry of Education.

1 day
It may take between 14 days to 2 months if the application needs to be referred to another agency for approval or review. For example, if the intention of the branch of a foreign company is to carry out activities involving the setting up of a private school, the application will be referred to the Ministry of Education.

3-5 days

Taxes

When the control and management of the company is exercised in Singapore, it is taxed as Singapore resident entity, tax exemptions and incentives available.

Taxed as non-resident entity, tax exemptions and incentives applicable to Singapore resident entity are not available.

Not applicable as Rep Office cannot render any direct or indirect revenue generation activities on behalf of its parent company.

Annual Filing Requirements

Annual return must be filed together with Singapore subsidiary’s annual financial statements.

Singapore branch shall, within 2 months of its annual general meeting, lodge the followings with the Registrar:-
1. A copy of the financial statements the foreign company for the financial year concerned
2. Documents accompanying the financial accounts filed overseas in the foreign company’s jurisdiction
3. A copy of the audited financial accounts of the Singapore branch office

Not applicable

Bank Account in Singapore

No restrictions to open bank account in Singapore.

No restrictions to open bank account in Singapore.

Can open bank account in Singapore to run the cost centre operations which is funded by the parent company.

Hiring of staff

No restrictions on hiring local or foreign staff. Hiring of foreign staff is subject to foreign worker quota based on business sector and the company’s workforce.

No restrictions on hiring local or foreign staff. Hiring of foreign staff is subject to foreign worker quota based on business sector and the branch’s workforce.

Chief representative must be a staff member from the parent company. Number of staff for RO should be less than 5 people.

Set Up Fee

S$315 (S$15 name application fee and S$300 incorporation fee)

S$315 (S$15 name application fee and S$300 registration fee)

A processing fee of S$200 per year is applicable. The processing fee is non-refundable for unsuccessful or withdrawn applications.

Appointment of Officers

Must appoint at least one director ordinarily resident in Singapore, at least 18 years old.

Must appoint at least 1 authorised representative who is ordinarily resident in Singapore. There is no restriction on the number of directors a foreign company can have.

Must appoint a Chief Representative who relocates from head office.

Read more

Annual Return & XBRL

What is XBRL?

XBRL

XBRL

 XBRL stands for eXtensible Business Reporting Language. It is an internationally recognised language used in computers for business reporting and electronic communication of business information between organisations.

With effect from 1 November 2007, Accounting & Corporate Regulatory Authority (ACRA) requires Singapore incorporated companies to file their financial statements in XBRL format. The use of XBRL will create a pro-enterprise financial reporting environment for businesses in Singapore, allowing financial information to be easily accessible and exchanged. It also enhances the accountability of businesses with increased transparency of business information.

In June 2013, ACRA announced the revision of filing requirements for Singapore incorporated companies. With effect from 3 March 2014, the revised XBRL filing requirements under the BizFinx system will apply. Filing of Option B (Partial XBRL) under the previous XBRL system (FS Manager) will no longer be available. Singapore incorporated companies (unless exempted), which are either unlimited or limited by shares and required to file their financial statements with ACRA, will need to file a full set of financial statements in XBRL.

Who needs to file XBRL?

All Singapore incorporated companies (unlimited or limited by shares), unless exempted to file financial statements with ACRA, will be required to file a full set of financial statements in XBRL format. The filing must comply with the minimum requirements reflected within the ACRA Taxonomy 2013.

However, the full XBRL filing requirement will not apply to:

  1. Banks, licensed insurance companies and finance companies regulated by the Monetary Authority of Singapore;
  2. Companies that are allowed by law to prepare accounts in accordance with accounting standards other than the Singapore Financial Reporting Standards (SFRS), SFRS for Small Entities and the International Financial Reporting Standards (IFRS);
  3. Companies limited by guarantee; and
  4. Foreign companies and their local branches.

Companies, excluded from the full XBRL filing requirement, shall continue to file by providing PDF copy of financial statements. Besides providing financial statements in PDF, companies under categories 1 and 2 would have to produce Financial Statements Highlights in XBRL format as well.

Insolvent exempt private companies (EPCs) have the following filing options:

  • A full set of financial statements in XBRL format; or
  • A full set of financial statements in PDF with Financial Statements Highlights in XBRL format.

On the other hand, solvent EPCs will remain exempted from filing their financial statements with ACRA.

What is the applicable financial period?

Your company will need to file its financial statement in XBRL format if you are filing:

  • financial statements for periods ending on or after 30 April 2007;and
  • Annual Returns on or after 1 November 2007.

How to file/upload XBRL file?

  1. Download BizFinx preparation tool for preparation of the XBRL report. Preparers will need to do mapping by matching data within the financial statements to an appropriate and compatible concept within the Taxonomy.(BizFinx preparation tool is an offline software application provided free of charge by ACRA to help companies to prepare and manage their financial statements in XBRL format in accordance with the revised XBRL filing requirements and new ACRA Taxonomy. It replaces the FS manager which was phased out with effect from 1 March 2014.)
  1. Once XBRL report is prepared, log in to BizFinx portal to validate and upload XBRL reports.

Alternatively, you may choose to save the hassle by engaging a professional service provider to assist you in the process.

Why should I outsource the work of XBRL to a professional service provider?

Directors of companies are liable for the correct representation and accuracy of financial statements filed with ACRA. Thus, directors are advised to check the information to be filed before authorising their staff to submit the information to ACRA. Filing of XBRL can be tedious and time-consuming. By outsouring the preparation of financial statements to a professional service provider, such as Enston, companies can save a lot of time and dedicate more time to their core business. Directors can also be assured that financial statements are prepared in compliance with the revised XBRL filing requirements and ACRA Taxonomy 2013.

Read more

Making Representation to ACRA

Logo of Accounting and Corporate Regulatory Authority (ACRA)

Accounting and Corporate Regulatory Authority (ACRA)

As  many of you are aware of, Singapore incorporated companies are subject to staying compliant with Accounting and Corporate Regulatory Authority (“ACRA”). If you are unable to hold your Annual General Meeting or lodge Annual Return on time, penalties will be imposed in accordance to the Companies Act.

For one reason or another, if you miss the filing deadline for Annual Return, you have to submit the Annual Return and pay annual return filing fee and the penalties imposed according to the Companies Act. Many of you wonder, in such situations, how to make appeal to ACRA to waive late filing penalties or composite fines. If you are interested in writing to ACRA for the waiver of fines or penalites, here is a brief guide on how you can do so.

AGM and AR beaches
A person who wishes to make representations to ACRA to review the summons issued against him (for example, to reduce the number of charges) or to reduce the composition sum or late filing penalty (for late filing of AR) would have to download a “Representation Form” from this link and provide the basis for his representations. Supporting documents (if any) must be attached. The completed Representation Form must be sent to ACRA (Attention: Compliance Department) by:

  • Fax to ACRA at: 6225 1676
  • Email to ACRA at: acra_cd@acra.gov.sg
  • Posting or delivering to ACRA at: 10 Anson Road, #05-01, International Plaza, Singapore 079903

Other breaches
A person who wishes to make representations to ACRA to review the summons issued against him (for offences other than those cited in paragraph 42) or to reduce the composition sum would also have to download a “Representation Form” from this link and provide the basis for his representations. Supporting documents (if any) must be attached. The completed Representation Form must be sent to ACRA (Attention: Investigation Department) by:

  • Fax to ACRA at: 6225 1676
  • Email to ACRA at: acra_id@acra.gov.sg
  • Posting or delivering to ACRA at: 10 Anson Road, #05-01, International Plaza, Singapore 079903

ACRA will require time to consider each representation and we may take up to 8 weeks to do so. At times, ACRA may request for additional information or supporting documents to support a claim made in the representation.

Please note that representations are rarely acceded to after consideration.

For further information, please refer to ACRA website here.

Read more

Setting up an Employment Agency

Setting up an Employment Agency

Setting up an Employment Agency

An employment agency needs to have a licence to operate in Singapore. Below you will find the key steps to setting up an employment agency in Singapore. Before we delve into more details, let us first discuss who needs to get an employment agency licence. According to Ministry of Manpower (MOM), organisations and individuals who place job seekers with employers must get an employment agency licence to operate in Singapore, unless otherwise stated. An employment agency licence is needed if organisations or individuals does any of the following:

  • Communicates with any jobseeker for the purpose of processing any employment-related application by that jobseeker.
  • Collates the biodata or resume of any jobseeker for the purpose of helping the jobseeker establish an employer-employee relationship.
  • Submits any work pass application on behalf of any employer or jobseeker.
  • Helps place any jobseeker with an employer.

The licence however is not required when recruiting persons for the sole purpose of employing them for own company or business and outsourcing the company’s own staff to customers’ premises or offices.

MOM website prescribes a comprehensive lists of activities where employment agency licence is not required. The following do not require an employment agency licence:

  • Wholly web-based job portals.
  • Organisations and individuals who maintain and operate any job bulletin board and who do not otherwise carry out any matching or placement.
  • Organisations who submit work pass applications and who do not otherwise carry out any matching or placement.
  • Recognised universities or educational institutions.
  • Community Development Councils.
  • Employment and Employability Institute Pte Ltd.
  • Singapore Workforce Development Agency

Next, let us further discuss on the key steps involved to set up an employment agency in Singapore.

1. Register the business
The first step is to register the business with one of the following principal activities as registerd with ACRA:
-Maid Agencies (SSIC 78103)
-Employment Agencies (excluding maid agencies) (SSIC 78104)
-Executive Search Agencies (SSIC 78105)

There are several different options to choose from when registering a business such as sole-proprietorship, partnership, private limited company, limited liability partnership or limited partnership. The choice will depend on personal circumstances. The popular option is to incorporate a priviate limited company.

2. Choose the right office space
While the traditional agency model of a high-street shop front is still a valid option, there are seveal options such as home office and co-sharing office unit, depending on the available budget . Kindly note that home office option is subject to a prior approval from HDB if the unit is a public housing address or the approval from URA for condominium unit. Pleaser refer here for more information on registered office address of a business in Singapore context.

3. Apply employment agency licence
The steps involved in this phase are to submit the application to MOM, to submit security bond and banker’s guarantee documents and finally to get the licence issued. Kindly note that all new employment agencies are required to furnish a security deposit ranging from $20,000 to $60,000. The employment agency which is under any of the Comprehensive Licences, key appointment holders and employment agency personnel must get the Certificate of Employment Intermediaries.

4.Register employment agency personnel
Employment agencies must register all their key appointment holders and other personnel. If employment agency is under a Comprehensive Licence (All), Comprehensive Licence (Local) or Comprehensive Licence (non-FDW), each candidate must also be certified to be registered. Those who are successfully registered will get a registration number and have their information uploaded to MOM’s EA directory.

5.FAQ
If you require any further information, please refer to MOM FAQ corner.

Read more

Registered Office Address

Registered Office Address

Registered Office Address

It is the company’s responsibility to update the Accounting and Corporate Regulatory Authority of the changes in its registered particulars. The change of registered office address or office hours is commonly filed via ACRA’s BizFile+ portal. The company is required to notify ACRA within 14 days from the date of change. Below you will find answers to most frequently asked questions for registered office address in Singapore.

Can P.O. Box address be used as registered office address?
P.O. Box address cannot be used as a registered office address.

Can a HDB address be used as registered office address?
HDB address can be used as a Singapore company’s registered office address only with prior approval of HDB (Housing Development Board). The approval can be applied through HDB website under the Home Office Scheme. For more detailed info, please refer to the HDB page on Home Office here.

Can a condominium address be used as registered office address?
Under the Home Office (HO) scheme, home owners, tenants or occupiers of private residential properties can conduct small–scale businesses in their homes, as long as they satisfy the prevailing HO guidelines and performance criteria and ensure that the use does not cause amenity problems to the neighbours. The approval can be applied through URA (Urban Redevelopment Authority) website under the Home Office Scheme. If you are not the owner, you have to obtain written consent from the owner before you register for the Home Office use.

Can one address be used as registered office address for more than one company?
Yes.

Are there any other alternatives apart from the use of residential units as registered office address without incurring substantial rental expenses?
The next alternative to using home address as registered office address is to use virtual offices services offered by corporate service providers in Singapore which specialize in providing an office address at affordable cost. Virtual office service providers typically offer various packages, including but not limited to, the provision of an office address, mail forwarding, mail drop-off services, meeting room rental services, and serviced office space services.

What is needed to update ACRA with the change of registered office address?
A director resolution duly passed by the board of directors of the company.
Approval letter from relevant authority if the address is that of a residential unit.

How can I file the change of Registered Office address with ACRA?
Any Director or Company Secretary of the company can login into ACRA bizfile website using his SingPass and update the new address/office horus and effective date.

Read more

Dormant Company Guide

What, How, Why, When, Who, Where?

What, How, Why, When, Who, Where?

This article is designed to be an easy-to-understand guide on compliance and regulatory matters surrounding Dormant Companies incorporated in Singapore.

In this context, let us first define what dormant company is under the definition given by Accounting and Corporate Regulatory Authority (ACRA). A company is considered dormant during a period in which no accounting transaction occurs.

Transactions that will not affect the dormant status of the company:

  • The appointment of a secretary of a company;
  • The appointment of an auditor;
  • The maintenance of a registered office;
  • The keeping of registers and books;
  • The payment of fees to the Registrar or an amount of any fine or default penalty paid to the Registrar (ACRA)
  • The taking of shares in the company by a subscriber to the memorandum in pursuance of an undertaking of his in the memorandum.

Are Dormant Companies required to file Annual Return?
Dormant companies are required to file Annual Return. However, they no longer need to attach the Statement by dormant companies exempting them from audit requirements (currently in PDF format). The appropriate online declarations will appear in the new Annual Return if the correct company type has been selected earlier.

Audit Exemption for Dormant Companies
The audit exemption applies to the financial accounts of a dormant company for any financial year beginning on or after 15 May 2003.

Audit exemption
Companies that are exempted from audit requirements are not required to have their accounts audited. Instead, they will prepare unaudited accounts for purposes of AGMs and filing with ACRA. If the company chooses to have the accounts audited, it will submit the audited accounts together with the auditor’s report.

Can ACRA require the accounts to be audited?
The Registrar may require the company to submit audited accounts and the auditor’s report, to the Authority, if

  • the Registrar believes that there has been a breach of the Companies Act; or
  • it is otherwise, in public interest, to do so.

Are Dormant Companies required to prepare financial statement?
The Companies (Amendment) Bill, which was passed by Parliament on 8 October 2014, contains amendments to the Company Act aimed at reducing regulatory burden on companies, providing for greater business flexibility and improving the corporate governance landscape in Singapore. The legislative change relating to new exemption of dormant companies from the preparation of financial statement take effect in the first quarter of 2016.

A dormant non-listed company (other than a subsidiary of a listed company) is exempt from requirement to prepare financial statements if the Company has been dormant from the time of formation or since the end of the previous, and it fulfills the substantial assets test. The substantial assets test is that the total assets of the company at any time within the financial year must not exceed $500,000. For a parent company, the consolidated total assets of group at any time within the financial year must not exceed $500,000.

Dormant listed companies and their subsidiaries, and dormant unlisted companies which do not fulfill the substantial asset test must prepare financial statements but are exempt from audit. There is no change for dormant listed companies and their subsidiaries. This new exemption aims to reduce regulatory costs for dormant companies which have lower public impact.

Is a Dormant Company required to file any documents to IRAS?
A dormant company must submit its Income Tax Return (Form C/Form C-S) unless it has been granted a waiver from IRAS. The company may apply for a waiver from IRAS by submitting the form ‘Application for a Waiver to Submit Income Tax Return (Form C) by a Dormant Company’.

Read more

Singapore Branch Guide

What, How, Why, When, Who, Where?

What, How, Why, When, Who, Where?

The Companies Act requires a foreign company to appoint at least one local agent from Singapore to act on behalf of the company. The agent must be an “ordinarily resident” (the usual place of stay of a person) in Singapore. For ACRA’s purposes, if a person can provide a local residential address and prove that he is staying in Singapore on a long-term arrangement (i.e. legally remain in Singapore for a long period), ACRA may accept that he is ordinarily resident here.

Preparation of Financial Accounts

Financial accounts of the branch must be prepared in accordance with the Singapore Financial Report Standards to give a true and fair view of their Singapore operations and must consist of an audited statement of its assets and liabilities and its profit and loss accounts of its operations in Singapore.

Annual Filing Requirements of Branch office in Singapore

Subject to Section 373 of Companies Act, a foreign company which has a Singapore branch shall, within 2 months of its annual general meeting, lodge the followings with the Registrar:-
1. A copy of the financial statements the foreign company for the financial year concerned
2. Documents accompanying the financial accounts filed overseas in the foreign company’s jurisdiction
3. A copy of the audited financial accounts of the Singapore branch office

When the parent company is not required by the law of the place of its incorporation or origin to hold an AGM and prepare a balance sheet, the parent company shall prepare and lodge with the Registrar a balance sheet within such period, in such form and containing such particulars and annex such documents as the directors of the company would have been required to prepare or obtain if the company were a public incorporated under the Singapore Companies Act.

Income Tax Filing Requirement of Foreign Company’s Singapore Branch

For taxation purposes, a company includes:

  • A business entity incorporated or registered under the Companies Act or any law in force in Singapore. It usually has the words “Pte Ltd” or “Ltd” as part of its name; or
  • A foreign company registered in Singapore such as a branch of a foreign company; or
  • A foreign company incorporated or registered outside Singapore.

With effect from YA 2010, a company is taxed at a flat rate of 17% on its chargeable income regardless of whether it is a local or foreign company.

Non-Singapore incorporated companies and Singapore branches of foreign companies are controlled and managed by their foreign parent and are, therefore, regarded as non-residents. As the result, certian incentives and treaties which are only available to Singapore Tax Resident Companies do not apply to the branch. However, they may still be treated as Singapore tax residents if they are able to satisfy IRAS that certain conditions have been met.

The statutory deadline for filing corporate income tax return is 30 November of the Year following the year in which the company’s financial year ends (e.g., if the financial period of the branch is 1 July 20X4 – 30 June 20X5, the income tax return filing deadline for the company will be 30 November 20X6.

On top of the statutory deadline for filing corporate income tax return, the branch is required to file Estimated Chargeable Income (“ECI”) to Inland Revene Authority of Singapore within 3 months from the parent’s company’s financial year end (e.g., if the financial year end of the parent company is 31 Dec 20X5, ECI filing is due on 31 March 20X6).

Read more