How to incorporate your private limited company in Singapore

private limited company requirements

Singapore is renowned for being one of the best places in the world to set up a business and this can be seen from its incorporation process. Setting up any business structure is easy peasy in Singapore. The process is streamlined and efficient and most entrepreneurs should find it relatively easy to handle the set-up themselves.

Since most startups set up private limited companies, here are some of the key things that you need to know before kickstarting your company.

Key Things You Need To Know Before Incorporating Your Private Limited Company

1). Company Name

Your company name has to be approved before your company can be incorporated. As such, you have to apply to reserve your proposed company name first. Once you’ve submitted your name, the approval process shouldn’t take more than 15 minutes unless the proposed name has wording that requires the approval of a relevant external government authority (e.g. Monetary Authority of Singapore).

To find out whether your proposed name may have words that will require additional approval, take a look at these guidelines.

In such instances, the approval process may take between 2 weeks to 2 months.

To make the process as quick as possible, choose a name that:

  • does not infringe any Singapore trademarks
  • does not conflict with any existing names
  • is not an undesirable name (not obscene or vulgar)

2). Shareholders

You can set up a private limited company in Singapore with a minimum of one shareholder and a maximum of 50 shareholders. If your company gets to the position where you have more than 50 shareholders, you’ll have to convert the company to a public company. Shareholders can be individuals or other companies, including foreign companies.

3). Directors

A Singapore private limited company must have at least one resident director and a director or shareholder can be the same person. A resident director is a person who is a Singapore citizen, permanent resident, or EntrePass holder. The other directors do not need to be resident directors.

There is no limit on the maximum number of directors although this can be restricted in the company’s constitution. Directors have to be at least 18 years of age (there is no maximum age limit following the implementation of the Companies (Amendment) Act 2014) and of general good standing (e.g. bankrupts and persons convicted of offences involving fraud or dishonesty are disqualified from holding director positions).

4). Company Secretary

Every company has to appoint a qualified company secretary within 6 months of its incorporation. The company secretary has to be a natural person who is resident in Singapore and is not debarred from acting as secretary of the company in accordance with the Companies Act.

If the startup founder is the sole director of the company, he cannot also act as the company secretary. As the company secretary is the person responsible for the administration of the company and ensuring the company complies with its various legal requirements, this position isn’t one to be taken lightly and the Companies Act states that it is the duty of the directors of a company to take reasonable steps to make sure the secretary of the company is a person who has the requisite knowledge and experience to discharge the functions of secretary of the company.

Some startups prefer to outsource this function to external law firms, accounting firms or corporate service firms.

5). Share Capital

The minimum share capital for registration of a Singapore company is S$1, and this is the only capital requirement now that the concept of authorized capital has been abolished. However, certain businesses may be required by law to have a higher paid-up capital as part of licensing requirements (e.g. a Capital Markets Services Licence requires the ability to meet the minimum financial requirements prescribed under the Securities and Futures Act).

Share capital can be increased as and when necessary anytime after the incorporation of the company.

6). Registered Address

The company needs to have a local Singapore address as the registered address of the company. This has to be either a residential or commercial address and cannot be a P.O Box.

If your startup outsources the company secretarial function, the address of the company providing this function will usually be used as the registered address for convenience as the company’s statutory books and records are usually kept at that address.

Pre-incorporation Checklist

Now that you're familiar with the main considerations before starting a private limited company, move onto our pre-incorporation checklist to make sure you haven't left anything out before registering your startup.