Key Takeaways
A Private Limited Company (Pte. Ltd.) is a separate legal entity in Singapore. Shareholders generally have limited liability capped at their share capital.
Pte Ltd provides tax advantages, credibility, and capital-raising flexibility, making it a popular structure for both local and foreign entrepreneurs.
Foreign entrepreneurs can fully own and register a Pte Ltd in Singapore, but must engage a corporate service provider to handle the government filings. Statrys can assist you throughout the registration process..
Choosing the right structure is one of the first and most important steps when starting a business in Singapore. Among the different options available, the Private Limited Company (Pte Ltd) stands out as one of the most popular choices for both local and foreign business owners.
Whether you’re a Singapore resident or an overseas entrepreneur looking to understand how a Pte Ltd works, this guide is for you. This guide explains everything you need to know: what a Private Limited Company is, how it compares to other types of business, its pros and cons, the basics of setting one up, and the obligations you’ll need to meet after incorporation.
What Is a Private Limited Company?
A Private Limited Company (Pte. Ltd.) in Singapore is a legal business entity that is privately held, with limited liability for its shareholders. The private limited company has its own legal identity, separate from that of its owners. This separation ensures that the personal assets of shareholders are generally protected from the company’s debts and obligations.
In Singapore, a Private Limited Company is governed by the Companies Act (1967). The act sets out rules on company formation, structure, directors’ duties and shareholdings. The Accounting & Corporate Regulatory Authority (ACRA) is the statutory regulator responsible for company registration and compliance.
Key Characteristics
- The private limited company is recognised as a separate legal identity, meaning it can own property, enter into contracts, sue, and be sued independently of its shareholders.
- Shareholders have limited liability, meaning financial exposure is restricted to the amount they have invested in the company.
- Can have up to 50 shareholders, who may be individuals, corporate entities, or a combination of both.
- Must comply with regulatory requirements set by the ACRA (Accounting and Corporate Regulatory Authority).
- Has restrictions on the transfer of shares, which are governed by its Company Constitution. These documents also define the company’s internal governance and legal obligations.
- Private limited companies are subject to corporate income tax.
Private Limited Company vs Other Business Structures
Private Limited Company (Pte Ltd) in Singapore differs from partnerships and sole proprietorships in several key ways, the most notable being liability protection, management structure, and taxation.
The table below outlines the differences.
| Feature | Private Limited Company (Pte Ltd) | General Partnership | Limited Liability Partnership (LLP) | Sole Proprietorship |
|---|---|---|---|---|
| Separate legal entity | ✅ | ❌ | ✅ | ❌ |
| Limited liability | ✅ | ❌ | For some partners | ❌ |
| Management | Shareholders may not manage | Partners manage directly | Partners have autonomy within limits | Owner manages directly |
| Taxation | Corporate tax rate of 17% | Partners taxed individually | Partners taxed individually | Personal income tax on profits |
Tip: Check out our article to learn more about the difference between a private limited company and a sole proprietorship in Singapore.
Pros and Cons of a Private Limited Company
✅Limited liability protects shareholders’ personal assets.
✅Various tax incentives, rebates and exemptions
✅Enhanced credibility with clients, suppliers, and lenders.
✅Strong capital-raising capability, as the company can issue new shares or bring in new investors more easily than sole proprietorships
❌Regulatory compliance requirements, including annual filings with ACRA.
❌Higher setup and ongoing administrative costs compared with sole proprietorships or partnerships.
❌ Formal structure and decision-making processes can slow responsiveness and limit direct control by founders.
Advantages of a Private Limited Company
Limited Liability Protection - Shareholders’ personal assets are protected from the company’s debts or legal obligations. Liability of shareholders is capped at the amount of share capital invested, offering peace of mind and financial security. This is a fundamental protection not available to sole proprietors or partners. However, this protection applies only if the company is properly managed and compliant with the law.
Tax Advantages and Incentives - Companies are subject to a competitive flat corporate tax rate of 17% on chargeable income. In addition, various tax rebates and R&D deductions are available. Start-ups may qualify for partial or full tax exemptions, with rebates of up to 50–75% on eligible amounts.
Enhanced Credibility - A private limited company is generally viewed as more reliable and established than a sole proprietorship or partnership because it must meet statutory obligations. This added credibility makes it easier to earn the trust of clients, opening doors to new contracts and partnerships.
Capital Raising - A private limited company can raise funds more easily by issuing new shares to investors or bringing in venture capital. Its legal status also makes lenders more willing to offer loans or credit facilities,
Disadvantages of a Private Limited Company
Greater regulatory burden – Incorporated companies must follow several rules under the Companies Act, such as holding annual general meetings (unless exempt), filing annual returns with ACRA, maintaining registers of directors and shareholders, and filing tax returns with the Inland Revenue Authority of Singapore (IRAS).
Higher administrative and running costs - Costs for company secretary, registered address, accounting, possible audit, maintenance of registers, compliance and statutory reporting are higher than for sole proprietorships or partnerships.
Formal structure can reduce direct control - If there are multiple shareholders, the founder may have less direct control over the business than in a sole proprietorship or partnership, since decisions must be made collectively and follow formal company procedures.
Requirements to Set Up a Private Limited Company
- Approved company name
- An initial paid-up capital of at least SGD 1
- At least 1 local director (director who is a Singapore resident). Those who don’t have a local partner often assign a nominee director to fulfil this requirement
- Between 1 and 50 shareholders, who may be individuals or corporate entities
- A registered business address in Singapore. The address to be used as the requirement is to be open for 3 hours every working day.
- A Singpass is required to complete the online application. If you do not have a Singpass, you must engage a filing agent to handle the registration on your behalf.
- If any position holder is a foreigner, it is mandatory to appoint a corporate service provider to manage the business registration.
Steps to Register a Private Limited Company
Registering a private limited company in Singapore involves a few key steps, from choosing a company name to appointing directors and filing the necessary documents with ACRA. Let’s look at the details.
| 1️⃣ |
Submit Your Company Name Application - Choose a unique name that isn't misleading or trademarked, and submit it for approval through ACRA's Bizfile portal.
Start by submitting your proposed company name for approval through ACRA's Bizfile portal . Your chosen name must be unique, non-infringing, and free from misleading or offensive terms.
To complete the submission, you'll need a Singpass or Corppass. If you don't have one, you need to use a registered filing agent to handle the process on your behalf.
Once ACRA approves your name, you'll receive a transaction number , which you'll need later when registering your company online.
|
| 2️⃣ |
Appoint a Local Director – At least one director must be a Singapore resident.
You must appoint at least one local director who is at least 18 years old and of full legal capacity. The local director must be a resident of Singapore and can include:
|
| 3️⃣ |
Secure a Registered Business Address – You’ll need a physical or virtual office in Singapore (no P.O. boxes).
Every company in Singapore must have a registered address that serves as its official correspondence location. The address must be a physical one within Singapore. P.O. boxes are not allowed. This address will appear on all company documents and must be accessible at least 3 hours during normal business hours.
To get a registered address, you can rent a commercial office, opt for a virtual office or use a corporate service provider that offers a registered address as a service. |
| 4️⃣ |
Prepare Required Documents and Information – IDs, address proof, share structure, and company constitution.
|
| 5️⃣ |
Submit Application & Pay Fee – File via Bizfile using Singpass or a filing agent.
Once everything is ready, submit your application through ACRA’s Bizfile portal using your Singpass. The system will prompt you to fill in the transaction number of your approved business name, company details, and the owners’ details. You will then need to upload supporting documents and pay the registration fee online.
Applicants without a Singpass must engage a registered filing agent to complete this step. |
| 6️⃣ |
Verify the Roles – Directors and shareholders will receive emails notifying them to confirm their roles.
After the application goes through, all appointed officers will receive a notification to confirm their role in the email. They must log in to Bizfile to confirm their consent to the appointments within 60 days. If any party fails to endorse, the application will be cancelled.
|
Once all approvals are complete, ACRA will issue your Unique Entity Number (UEN), and Business Profile, officially confirming your company’s registration in Singapore.
You can also purchase a Certificate of Incorporation via Bizfile.
Tip: Check out our article to learn everything you need to know about company formation in Singapore and how to register a private limited company online. We provide detailed screenshot by screenshot tutorials.
Obligations for Private Limited Company in Singapore
- Register for Corppass to manage online transactions with government agencies such as IRAS. It is essential for submitting tax and compliance filings.
- Appoint an auditor within three months of incorporation. Private limited companies must have their financial statements audited annually by a registered auditor unless they qualify as a small company, meeting at least two of these criteria: Annual revenue ≤ SGD 10 million, total assets ≤ SGD 10 million, and having 50 or fewer employees
- Appoint a company secretary within six months of incorporation. The secretary must be a Singapore resident and qualified for the role. They handle key compliance matters.
- The company must hold an Annual General Meeting (AGM) and file annual returns with ACRA each year to keep company information up to date.
- Register for Goods and Services Tax (GST) if the business’s taxable turnover exceeds SGD 1 million in a year, or is expected to do so in the next 12 months.
- Set up a dedicated bank account or business account to keep your personal and business finances separate. This makes bookkeeping, taxes, and expense tracking much simpler and more professional.
Can a Non-resident Set Up a Private Limited Company in Singapore?
Yes. Foreign entrepreneurs can fully own and operate a Private Limited Company in Singapore. The Singapore government actively encourages foreign investment and business formation, offering one of the most straightforward incorporation processes in Asia.
The overall conditions are the same as for local residents. The only key difference is that, according to ACRA, if any position holder (such as a director or shareholder) is a foreigner, it is mandatory to appoint a filing agent or a licensed Corporate Service Provider (CSP) to handle the business registration on your behalf.
Register Your Singapore Private Limited Company with Statrys
There are several reasons why a Private Limited Company (Pte Ltd) is the preferred structure for both local and foreign entrepreneurs in Singapore. It offers limited liability, tax efficiency, and professional credibility.
At Statrys, we make it simple for foreign founders to set up Private Limited Company in Singapore.
Everything You Need to Get Started
✔️ Incorporation filing with ACRA
✔️ Registered business address
✔️ Appointing a resident director
✔️ Corporate secretary service
✔️ Launch your company in 5 days
✔️ Get your Certificate of Incorporation & Business Profile
✔️ Assistance with opening a multi-currency account for global transactions
Was this article helpful?
Yes
No
FAQs
What is a Private Limited Company in Singapore?
A Private Limited Company (Pte Ltd) is a separate legal entity with its own rights and liabilities, independent of its shareholders. It can own assets, enter contracts, and incur debts in its name. Shareholders’ liability is limited to their investment.
