Requirements to Register an LLC in Singapore

Singapore has earned a reputation as one of the world’s most business-friendly environments, making it an attractive destination for entrepreneurs looking to set up their companies. If you're planning to start a business in Singapore, registering a Limited Liability Company (LLC) is one of the most popular choices for both local and foreign entrepreneurs.

The key reason why many opt for an LLC registration in Singapore is the limited liability protection it offers. As a shareholder, your assets are protected from the company’s debts and obligations, which is an appealing feature for many. However, before you register an LLC in Singapore, there are specific requirements and steps you must follow. In this post, we will guide you through the process and highlight the requirements for setting up a limited liability company in Singapore.

What Is an LLC in Singapore?

A Limited Liability Company (LLC) in Singapore is a business entity that offers limited liability to its shareholders, meaning they are not personally responsible for the company’s debts beyond the amount of their investment in the company. This structure is ideal for entrepreneurs who want to separate their personal and business finances while enjoying the benefits of a corporate entity.

There are two types of LLCs you can register in Singapore:

1. Private Limited Company (Pte Ltd): The most common LLC structure in Singapore, suitable for businesses with fewer shareholders and no intention of publicly trading shares.
2. Public Limited Company: This is less common and typically used for larger organizations, often intending to go public in the future.

In this article, we will focus on the requirements for setting up a private limited liability company in Singapore, which is the most popular choice among entrepreneurs.

Key Requirements for LLC Registration in Singapore

Now, let’s look at the essential requirements you need to meet when you’re ready to register an LLC in Singapore.

1. Company Name

Your first step in registering a limited liability company in Singapore is selecting a name for your business. The company name must be:

• Unique and not similar to any existing company name registered in Singapore.
• Compliant with Singapore's naming guidelines, meaning it should not be offensive or infringe on any trademarks.

To check the availability of your company name, you can use ACRA’s (Accounting and Corporate Regulatory Authority) online portal. Once your name is approved, it will be reserved for 60 days, giving you time to complete the rest of the registration process.

2. Minimum Number of Shareholders and Directors

To register an LLC in Singapore, you need to fulfill the following requirements regarding shareholders and directors:

• Shareholders: A minimum of one shareholder is required, and this shareholder can be either an individual or a corporate entity. The maximum number of shareholders is 50.
• Directors: A minimum of one director is required for your company, and this director must be a resident of Singapore (either a Singaporean citizen, a permanent resident, or a holder of an Employment Pass, Dependent Pass, or EntrePass).
• Corporate Secretary: You are also required to appoint a company secretary within six months of incorporation. The company secretary must be a natural person and a resident of Singapore. This role is vital for ensuring your company adheres to compliance requirements and maintains corporate governance.

3. Company's Registered Address

Every LLC in Singapore must have a physical registered address within the country. This address will be used for all official correspondence and must be a physical location; it cannot be a P.O. Box. The registered office must be open during normal business hours, and it must be in a commercial or residential area permitted for business use.

4. Share Capital

The minimum paid-up share capital for registering a limited liability company in Singapore is S$1. This amount is symbolic and is sufficient to meet the registration requirements. However, you can increase the share capital if needed, especially if your business requires higher capital to operate effectively.

It’s important to note that share capital is not the same as working capital. You don’t need to deposit the full share capital in a bank account at the time of registration, but you can contribute more capital as needed once your business is operational.

5. Business Activities

When you register a company in Singapore, you will need to specify the business activities your company will engage in. Singapore uses a system of Standard Industrial Classification (SIC) codes to categorize business activities. You will need to select the relevant SIC code that best represents your business’s operations.

Make sure to choose the correct SIC code, as this will determine the regulations and requirements your business needs to follow. It is also crucial for tax purposes, as certain sectors may have tax incentives or exemptions available.

6. Director's Consent

If you're not planning to serve as the director of your LLC, you must obtain consent from the appointed director. The director will have certain responsibilities, including managing the day-to-day operations of the company and ensuring compliance with all regulatory requirements.

7. Company Constitution

Your LLC will need to draft a Company Constitution (previously called the Articles of Association) that outlines the rules governing the company. The Constitution covers matters such as shareholder rights, the power of a resident director in Singapore, and how the company will be run. This document is an essential part of your company's legal framework.

8. Filing with ACRA

Once you have gathered all the necessary information and documents, you can submit your application for LLC registration with ACRA through their online portal, BizFile+. This system allows you to file all required documents, including your company name, details of shareholders, directors, company constitution, and other necessary information.

ACRA processes most applications within a few hours, and once approved, your company will be officially registered.

Benefits of Registering an LLC in Singapore

There are several advantages to setting up a limited liability company in Singapore. Some of the key benefits include:

1. Limited Liability Protection: As mentioned earlier, one of the most significant advantages of an LLC is that shareholders are only liable for the amount they have invested in the company. Your personal assets are protected from business-related liabilities.

2. Tax Incentives: Singapore offers a highly favorable tax system, with low corporate tax rates and various tax exemptions for qualifying businesses. Startups, in particular, can benefit from tax incentives like the Start-up Tax Exemption Scheme.

3. Ease of Doing Business: Singapore consistently ranks as one of the best places in the world to do business due to its stable economy, well-established legal system, and ease of company registration. The country also offers a highly skilled and educated workforce, making it a prime location for foreign entrepreneurs.

4. Access to Global Markets: As a strategic hub in Asia, Singapore provides access to key international markets. The country has a comprehensive network of free trade agreements, making it easy for companies to expand into neighboring regions.

Conclusion

Registering an LLC in Singapore is an excellent way to establish a business that offers limited liability protection, tax incentives, and access to a global market. Understanding the requirements for LLC registration in Singapore is essential to ensuring that your business is compliant with local regulations and ready to grow.

If you’re considering setting up a limited liability company in Singapore, make sure to follow all the necessary steps and seek professional advice to streamline the process. Once your company is registered, you can begin operating with confidence, knowing that you have a strong legal foundation for your business.

FAQs

1. How long does it take to register an LLC in Singapore?
The registration process for an LLC in Singapore is usually completed within 1 to 3 working days, as long as all documents are in order and the company name is approved.

2. Do I need a local partner to register an LLC in Singapore?
No, you do not need a local partner to register an LLC in Singapore. However, at least one director must be a resident of Singapore.

3. Can I open a corporate bank account for my LLC immediately after registration?
Yes, you can open a corporate bank account for your LLC after registration. However, banks may require additional documents, such as your company’s constitution, a copy of your director's identification, and proof of business address.