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Singapore Company Incorporation FAQs

Frequently Asked Questions about Singapore Company Formation

TOP FAQs

  • What are Private Companies?

    Maximum number of shareholders is limited to 50 and the memorandum and articles of association restricts the right of its members to transfer their shares in the company.

     

    A private company limited by shares can be classified as a exempt private company.

    The key characteristics of an exempt private company is:

    • No more than 20 shareholders; and
    • All the shareholders are individuals.
    • Exempt private companies with an annual revenue of less than S$5 Million are exempted from audit requirements and are not required to file financial statements with the ACRA.

    It is also exempted from prohibitions against loans to its directors or to companies related to its directors.

  • What is a company?

    A company is a business entity registered under the Companies Act, Chapter 50. Most companies in Singapore are private companies limited by shares and are recognized by the suffix “Pte Ltd”.

  • Does a Singapore subsidiary require a registered address in Singapore?

    Yes, all Singapore companies and subsidiaries need to have a registered address in Singapore.

  • What is the difference between a director and a shareholder?

    Shareholders
    own the company and are entitled to the profits of the company.

    Directors
    managing and overseeing the company operations, dealing with the everyday responsibilities.

  • Who is ordinarily resident in Singapore?

    A Singapore citizen, Singapore Permanent Resident or EP holder who is residing in Singapore.


Types of Entities

What is a company?


A company is a business entity registered under the Companies Act, Chapter 50. Most companies in Singapore are private companies limited by shares and are recognized by the suffix “Pte Ltd”.

What are the Different Kinds of Companies?


  • Private/public company limited by shares
  • Public Company Limited by Guarantee

What are public companies?


A public company can have unlimited number of shareholders.

 

When a company can offer shares, debentures and other interests to the public, it is known as a public company.

A public company can be unlisted or listed on a stock exchange.

The compliance requirements for public companies are much higher than that of private companies.
Private companies with more than 50 shareholders must be converted to public companies limited by shares.

What are Private Companies?


Maximum number of shareholders is limited to 50 and the memorandum and articles of association restricts the right of its members to transfer their shares in the company.

 

A private company limited by shares can be classified as a exempt private company.

The key characteristics of an exempt private company is:

  • No more than 20 shareholders; and
  • All the shareholders are individuals.
  • Exempt private companies with an annual revenue of less than S$5 Million are exempted from audit requirements and are not required to file financial statements with the ACRA.

It is also exempted from prohibitions against loans to its directors or to companies related to its directors.

What are Public Companies Limited by Guarantee?


Not-for-profit, religious and charitable organisations usually set up public companies limited by guarantee. There is no share capital. When the company is wound up, each member pays the amount that they have guaranteed, which can be as little S$1.


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