As the name suggests, an EPC may be entitled to certain exceptions to certain tax obligations and audit requirements. In addition, a CPE such as a limited liability company also brings you similar benefits such as a separate legal status and limited liability of partners through shares. According to the World Bank`s Ease of Doing Business Index, Singapore is undoubtedly one of the friendliest places for limited liability companies. But to get the most out of it, you need to proceed with the ideal type of AUTOMATON. For starters, ACRA expects you to prepare the following documentation if you intend to set up a private company exempt from the Limited in Singapore: Therefore, those who are ready to start their career as an entrepreneur must first register a business in Singapore. The main requirements are as follows: Side note, this regime does not apply to all companies. Companies specializing in investments, such as . B participations or in real estate development, as is the case with real estate companies, cannot claim this tax exemption. An exempt private company and a non-exempt private company are both forms of companies in Singapore.

But while the former can only accommodate up to 20 shareholders, the latter has the privilege of expanding up to 50. The Companies Act prohibits companies from lending to other companies. Companies are also not allowed to provide credit guarantees or sign loan guarantees for other companies if a director of the first company is associated with the second company. The Companies Act designates these affiliations as 20% of the ownership of the company`s shares or participation in the company. In addition, the law prohibits companies from lending to one of their directors. In total, you can receive a maximum exempt amount of $125,000 for each year of the first 3 years of incorporation. This exemption is levied sequentially for the first three years of the company`s existence in S$100,000 lumps. For the first year, the first S$100,000 is exempt at a rate of 100%. The remaining S$200,000 will be exempted at a rate of 50% for the next two years.

Thus, the total tax-exempt amount is S$200,000 out of the S$300,000. Overall, EPC follows pretty much the same incorporation process as other limited liability companies in Singapore. You submit the application through ACRA`s BizFile+ portal, wait for the next approval email, and then begin post-incorporation compliance. EPC is currently the most common and preferred type of business entity in Singapore due to reduced compliance requirements, greater freedom in financial lending activities, and tax exemptions granted during the start-up phase. But what does this mean for exempt private limited liability companies in Singapore? A subsidiary is also a limited liability company. However, it is wholly or partly owned by another business entity called a parent or holding company. Singapore`s Companies Act allows 100% foreign ownership; Therefore, the foreign company may hold all the shares of the subsidiary or it may partially share ownership with a local entity or other foreign company. The liabilities of the subsidiary are not transferred to the parent company. The assets of the parent company remain isolated from the liabilities of the subsidiary. The financial statements of the parent company need not be disclosed to or by the subsidiary.

The subsidiary is only required to submit its own annual returns, but not those of its parent company. The main advantage of an EPC is that it is exempt from the requirement to attach financial statements to its annual return. All companies in Singapore must be registered with the Accounting and Business Regulatory Authority (ACRA) and comply with the Companies Act, Chapter 50. Although there are five different companies to choose from, namely sole proprietorships, partnerships, partnerships, limited partnerships and limited partnerships; The most common and flexible option is to start a business in Singapore. Now let`s get into the process of setting up a tax-exempt limited liability company in Singapore. What do you think you need to get started? This means that a private company liberated in Singapore is responsible for its own debts and losses. The shareholders` liabilities do not exceed the share capital they own. In addition, your EPC in Singapore can be assured of continuity with a simple transfer of ownership by transfer of shares.

EPC`s turnover determines its obligation to account and audit the annual accounts. If your EPC`s revenue is less than S$10 million, Singapore law exempts you from submitting annual financial statements and audits. Private company with limited liability exempt by shares An exempt private limited liability company by shares is a private company with a maximum of 20 shareholders. Moreover, none of the shareholders is a corporation. It may also be a business that the Minister has designated as an exempt private enterprise. Company Secretary: You will have a period of 6 months from the date of incorporation to fill the position of Company Secretary, which, among other things, holds the key to EPC registration. This person must have their habitual residence in Singapore, be well qualified and have relevant administrative expertise to ensure consistency in the company`s compliance with regulatory requirements. A private corporation with more than 20 shareholders but 50 or fewer shareholders or shareholders or shareholders who are corporations. This type of private enterprise is not exempt. Singapore does not limit foreign shareholders to the number of shares they should own.

Thus, a foreigner in Singapore is free to fully own an EPC. Next, you must submit the by-laws and memorandum to the Registrar of Corporations. The Registrar analyzes your documents and confirms their approval by email. The registrar also assigns your business an identity number called a unique entity number. In all other cases where your business does not meet the above criteria, the requirement to submit audited financial statements and report annual financial statements applies as usual. Under the program, your newly formed CPE is eligible for tax exemption on the first $200,000 of their taxable income each year for the first 3 consecutive years beginning with the 2020 Assessment Year (YA). To be more specific: 3. A person can act as a resident director and as a required individual shareholder. However, you will find that most financial institutions such as banks require your business to have at least two signatories. · The shareholders` liability to the company`s creditors is limited to the capital initially invested by the shareholders. However, these exceptions do not apply to all private corporations exempt from incorporation.

Companies that trade in real estate sales or investments and holding companies that trade investments are not exempt from tax under Singaporean law. .