A company is a legal entity that is separate and distinct from its members and directors. It is formed by individuals or corporations coming together to engage in business activities. Here are some key points about a company:
Ownership:
The ownership of a company is determined by its shares. Individuals or corporations can hold shares in the company.
The number of members allowed in a company depends on its type. Exempt private companies can have up to 20 individual members, while private companies can have up to 50 members. Public companies can have more than 50 members.
Legal status:
A company is a separate legal entity from its members and directors. It can enter into contracts, own assets, and sue or be sued in its own name.
The liability of the members is limited to the extent of their investment in the company. Their personal assets are generally not at risk for the company's debts and losses.
Registration requirements:
A company must have at least one member, who can be an individual or a corporation.
It must also have at least one director who is ordinarily resident in Singapore, either a Singaporean or a Singapore Permanent Resident.
If an Employment Pass holder wants to be appointed as a director, approval from the Ministry of Manpower is required.
Undischarged bankrupts generally cannot manage a company without approval from the court or Official Assignee.
Formalities & expenses:
Setting up and maintaining a company can be more costly compared to other business forms.
There are various formalities, procedures, and compliance requirements that must be followed, such as appointing a company secretary, having an auditor (unless exempted), holding Annual General Meetings, and filing annual returns.
Additional filings may be required for specific actions like changing the company's name, allotting shares, or transferring shares.
Set up fees:
The fees for setting up a company include SGD15 for name reservation and SGD300 as a one-time registration fee.
Taxes:
The profits of a company are subject to corporate tax rates.
Continuity in law:
A company has perpetual succession, meaning it can continue to exist until it is wound up or struck off the official register.
Closing of entities:
A company can be wound up voluntarily by its members or creditors, or compulsorily by the High Court.
Alternatively, it can be struck off from the official register upon non-renewal of registration or if the Registrar determines that the company is defunct.
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