Once a Singapore Company is incorporated, it becomes essential to comply with the requirements of the Singapore Companies Act. It becomes mandatory to make annual filings with the Accounting and Corporate Regulatory Authority, the Inland Revenue Authority of Singapore (IRAS) and other related Authorities.
Register of Registrable Controllers
Requirement for Companies, Foreign Companies and Limited Liability Partnerships to maintain Register of Registrable Controllers
With effect from 31 March 2017, companies, foreign companies and LLPs (unless exempted) will be required to maintain beneficial ownership information in the form of a register of registrable controllers, and to make the information available to public agencies upon request.
The aims is to make the ownership and control of corporate entities more transparent and reduce opportunities for the misuse of corporate entities for illicit purposes. This will bring Singapore in line with international standards, and boost Singapore’s on-going efforts to maintain our strong reputation as a trusted and clean financial hub.
Register of Nominee Directors
With effect from 31 March 2017, Companies are required to each:
- keep a register of its nominee directors containing the particulars of the nominators of the company’s nominee directors; and
- produce the register of nominee directors and any related document to the Registrar, an officer of the Accounting and Corporate Regulatory Authority or a public agency, upon request.
Unlike the register of controllers for companies, companies are not required to take reasonable steps (including sending out notices) to identify their nominee directors, or to update or correct inaccuracies in the particulars contained in their registers of nominee directors.
Instead, nominee directors are required to inform their respective companies of the fact that they are nominees and provide the prescribed particulars of their nominators to their companies within the applicable timelines.
Financial Year End (FYE)
Every Singapore Company must plan its Financial Year End (FYE) that represents the completion of its accounting period. It is not necessary that the FYE of a Company matches with the regular annual calendar. It could fall on any day of the year.
The fiscal year of a Company is taken as the financial year. It is up to the Company to decide its FYE, and most Singapore Companies assign 31st December, 31st March, 30th June or 30th September as the ending date of their fiscal year.
It is in the best interests of a Singapore Company to fix their FYE within 365 days. This helps the Company to take advantage of the Zero Tax Exemption offered for new start-ups. The Singapore Law offers an exemption to new start-ups for their first SGD100,000 regular chargeable income for the first three consecutive year of assessments.
Appointment of Auditors
Under section 205 of the Companies Act, the directors of a company are required to appoint at least one accounting entity to be the company’s auditor within 3 months of the company’s incorporation. In Singapore, only public accountants or accounting firms approved by the Accounting and Corporate Regulatory Authority (ACRA) can act as company auditors.
Auditors will hold office from the time of their appointment until the conclusion of the company’s next annual general meeting (AGM). Therefore when a newly-incorporated company first appoints an auditor, this auditor will hold office until the conclusion of the company’s first AGM.
Then during the first AGM, the company will have to appoint a new accounting entity (or reappoint the same accounting entity) to act as the company’s auditor until the conclusion of the next AGM. This auditor will then hold office until the conclusion of the company’s subsequent AGM, and so on and so forth.
If the directors fail to appoint a company auditor, any company member may apply to the Registrar to have it appoint an auditor for the company instead.
Exemption from Audit Requirements
Companies that are regarded as a “small company” for a particular financial year, or are dormant, are exempt from audit requirements. These companies therefore do not need to appoint auditors (or have their financial statements audited) for that financial year.
Small Company Exemption
In general, a company will be considered a “small company” if it is a private company throughout the current financial year, and satisfies any 2 of the following criteria for each of the 2 financial years immediately before the current financial year:
- The company’s revenue does not exceed SGD10 million;
- The value of the company’s total assets does not exceed SGD10 million; or
- The company does not have more than 50 employees.
Refer to the Thirteenth Schedule of the CA for the criteria that companies incorporated for less than 3 years, or incorporated before 1 July 2015, have to meet in order to be considered a “small company”.
- For a company which is part of a group:
- (a) the company must qualify as a small company; and
- (b) entire group must be a “small group”
- to qualify to the audit exemption.
- For a group to be a small group, it must meet at least 2 of the 3 quantitative criteria on a consolidated basis for the immediate past two consecutive financial years.
- Where a company has qualified as a small company, it continues to be a small company for subsequent financial years until it is disqualified. A small company is disqualified if:
- (a) it ceases to be a private company at any time during a financial year; or
- (b) it does not meet at least 2 of the 3 the quantitative criteria for the immediate past two consecutive financial years.
- Where a group has qualified as a small group, it continues to be a small group for subsequent financial years until it does not meet at least 2 of the 3 the quantitative criteria for the immediate past two consecutive financial years.
A company will also be exempt from audit requirements if:
- It has been dormant from the time of its formation; or
- It has been dormant since the end of the previous financial year.
A company is dormant during a period in which no accounting transaction occurs. Dormant companies will cease to be considered dormant once such an accounting transaction occurs.
The following are not to be considered as accounting transactions (refer to section 205B(3) of the CA for the full list):
- The appointment of a company secretary
- The appointment of an auditor
- The keeping of company registers and books
- The payment of any fees or charges that the law requires to be paid
Exception to exemption from audit requirements
Even if a company is exempt from audit requirements, the Registrar may still require the company to lodge its audited financial statements and an auditor’s report if the Registrar is satisfied that the company has breached laws relating to the:
- Keeping of accounting records (section 199 of the CA); or
- Laying of its financial statements at its AGM (section 201 of the CA).
Disclosing of Company Registration Number (UEN)
The Singapore Companies Act makes it mandatory for every Company to print their Unique Entity Number (UEN) on all their official print materials including invoices, business letters, Statement Of Accounts, official notices and publications among others.
Notification of Changes
A Singapore Company has to notify the Registrar about any changes with regard to its share capital, shareholders or officers in a specific time period laid down by the ACRA. Penalties are imposed if the Company fails or delays to comply with this requirement.
Business Licensing and Permits
Certain business activities in Singapore are required to be regulated under the Government Law. A registered business cannot commence operations unless it has received the licence or approval from the respective Government department/s. Eg: In order to run an Employment Agency, the company is to obtain a separate licence from the Ministry Of Manpower (MOM) after fulfilling the required (mandatory) criteria.
Registered Office and Working Hours
Every Singapore Company is required to have a registered office in Singapore to which all communication and notices may be addressed and which shall be open and accessible to the public for at least 3 hours a day during regular business hours on weekdays.
Customs Registration Number (CR)
Declaring Entities and individuals carrying on business under their full name that intend to engage in import and/or export activities in Singapore, or appoint a Declaring Agent to apply for Customs import, export and transhipment permits or certificates through TradeNet have to activate their entity’s Customs Account
A Declaring Entity refers to any importer, exporter, shipping agent, air cargo agent, freight forwarder, common carrier or other persons who wish to obtain a permit, licence, certificate or any other document or form of approval from Singapore Customs.
Only the Key Personnel such as the owner, partner or director whose record is registered with ACRA or the relevant UEN Issuance Agency can activate your entity’s Customs Account using his / her CorpPass or SingPass.
Goods and Services Tax (GST)
What is Goods and Services Tax (GST)?
The Goods and Service Tax or GST is comparable to the VAT or Value Added Tax found in many other countries. It is a consumption tax that applies to many of the domestic goods and services used in Singapore. The current rate of GST is 7%.
GST however does not apply to sale/lease of majority financial services and residential real estate in Singapore. Even export of goods and services used elsewhere (outside Singapore) is exempt from GST. In order to collect GST, suppliers are required to register with the Comptroller, GST. The Singapore Customs collects GST against any goods that are imported at the point of import.
If you are a supplier of goods/services having annual income exceeding or expected to exceed SGD1 million, it is mandatory to register with the Comptroller. If you are a supplier who does not fall into this income bracket, you can still apply for voluntary registration. In this case, the Comptroller determines whether to approve your registration or not. After voluntary registration, it becomes mandatory to remain so for at least two years.
GST Services by ACHI Biz
GST services by ACHI Biz helps make the process of registration, compliance and filing more convenient. We have experienced staff on GST services who help your Company with the following processes:
Registration for GST
ACHI Biz applies for registration of GST on your Company’s behalf with the Inland Revenue Authority of Singapore [IRAS]. We will follow up with all the queries with regard to the registration.
Filing of GST
We provide an assessment for determining the effect of GST registration on your business and customers. We will provide recommendations based on this assessment for the ideal GST filing period for your business. You can take advantage of our bi-annual or quarterly GST filing services.