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MCA Compliance for Private Limited Company in Singapore

What Should you do After Incorporating a Private Limited Company in Singapore?

All private companies in Singapore need to be registered with the Accounting & Corporate Regulatory Authority (ACRA) and abide by the MCA Compliance for Private Limited Company in Singapore  as per the Companies Act stipulated by the Ministry of Corporate Affairs (MCA). While there are five main business structures available, the most commonly set up business entities are the Private Limited Companies.

Singapore specifies Mandatory RoC Compliance  for all companies to file the RoC forms, returns and documents with the Registrar of Companies (RoC), ACRA to ensure that the company is carrying out business activities in accordance with the Companies Act.

Therefore, before you start a business in Singapore, you must be aware of all post-registration compliance requirements and carefully prepare a detailed Company Compliance Checklist  so that your company, once incorporated, doesn’t face legal issues.

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What is a Private Limited Company?

A private limited company is a separate legal entity from its shareholders and is limited by shares. It is a taxable company, and its shareholders are not liable for its debts and losses beyond the share capital amount.

The main requirements to incorporate a Singapore private limited company include the following.

Why should you Set Up a Private Limited Company in Singapore?

A private limited company in Singapore offers many benefits to an entrepreneur including increased possibilities to get commercial loans from banks and non-banking financial institutions, special tax exemptions and incentives e.g. tax waiver for the first SGD 100,000 of taxable income and lower effective tax rates of 5.6% on taxable income of up to SGD 300,000.

Besides, there are other advantages of setting up a Private Limited company as follows.

What are the Post Registration Legal Requirements of Private Limited Company in Singapore?

The following are the key post-registration legal requirements that you need to comply with to start and continue your business activities.

Singapore MCA Compliance Requirements  bring certain industries under the licensing regime and you cannot begin operation unless you obtain the necessary permit or license from the relevant government regulatory bodies.

Some sectors needing business licenses are Private schools, tours and travels, liquor distributors, moneylenders, banks, financial advisers, video companies, crèches, importers, wholesalers, and retailers.

Your registered office must be open to the public for a minimum of three hours on all weekdays during normal business hours.

Business registration numbers must be displayed on all letterheads, invoices, billings, quotations, or other documents used for official communications.

Business activities involving import, export, and transshipment in and out of Singapore need registration with the Customs Authority and you must obtain a CR Number, known as a Custom Registration number. It applies to all companies engaged in trading activities.

Corporate Compliance Requirement  mandates Goods and Services Tax (GST) on the supply of goods and services in Singapore including imports of goods. GST is exempted on the goods exported from Singapore and international services provided from the country.

The nominal GST rate is 7% and all businesses with annual taxable revenue of more than SGD 1 million must register for GST. Companies currently making taxable supplies with projected taxable revenue of more than SGD 1 million must also register. The GST registration must be within thirty days from the time it becomes liable.

Voluntary GST registration is allowed and approval for such is at the discretion of the IRAS Comptroller. Once approved, you must remain registered for a minimum of two years.

Requirements of MCA Compliance for Private Limited Company in Singapore  require you to register with the Central Provident Fund or CPF which is a compulsory pension fund scheme in which both employer and employee contribute a percentage of the monthly salary to the fund. CPF contribution by the employer is mandatory for all local employees including Singapore citizens and permanent residents, earning more than SGD 50 a month. The maximum CPF contribution rate for employer and employee is specified as 17% and 20% respectively. The rate can be lower considering certain factors such as employee age, permanent resident status, etc. Foreign employees don’t come under CPF contribution requirements.

The Takeaway

Regulatory compliance in Singapore is critical to keep you in business and failure to do so often attracts penalties. Besides, as per Singapore Companies Act, every private limited company, unless exempted, must file certain reports to relevant government bodies every year including Annual Financial Statements & Annual Return (AR) Filing with ACRA and Annual Tax Return Filing with IRAS

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