Statutory requirements for Singapore incorporated Companies

As a new business owner or manager, one of the first question is what are the reporting requirements that I need to comply with to ensure that my Singapore Company is meeting its compliance requirements.

Reporting Requirements for Singapore Companies

There are basically two main regulatory bodies in Singapore that require the Company to submit annual returns to. The Company needs to submit two types of returns:

  • Annual returns to ACRA
  • Tax returns to IRAS

Let’s take a more detailed look at each of the returns in more details.

Annual returns

A Singapore Company is required to submit an annual return each year to ACRA. An annual return is a notification to ACRA that the Singapore Company has complied with the statutory requirement to hold an annual Annual General Meeting (AGM) for its shareholders and that all changes to shareholdings and officers of the company has been updated in ACRA’s records.

This is because in a company structure where the shareholders and directors are not the same individuals. The shareholders are not involved in the day-to-day running of the business. Hence, the Companies Act requires that the shareholders be updated on the performance of the Company at least once a year through the AGM. During the AGM, the directors are supposed to present the financial statements to the shareholders and the shareholders will approve the director’s remuneration for the year.

The revised requirements after Aug 2018 for non-listed companies states that for companies with their financial year end ending on or after 31 Aug 2018, the timelines for holding the AGM, presenting the financial statements and filing the annual return are:

COMPANIES REQUIREMENTSTIMELINES
Holding AGMAGM has to be held within 6 months after financial year end.
Laying of Financial StatementsThe financial Statements have to be presented within 6 months after financial year end.
Filing Annual ReturnFile annual returns within 7 months after financial year end.

A Singapore company can choose not to hold an AGM if they have met the following conditions subjected to certain safeguards:

  • All members have approve a resolution to dispense with the holding of AGMs
  • Financial statements have been sent to shareholders within 5 months after the FYE
  • or if the company is a private dormant relevant company that is exempt from preparing financial statements

Tax returns

Every company is required to file its tax returns. There are actually two filings required. The first filing is an estimated chargeable income or known as (ECI). This has to be filed within 3 months of the companies’ financial year end.

Based on the ECI, the tax authorities, IRAS, will then raise an estimated tax assessment on the company and the company will need to first pay any tax.

Subsequently, once the Company has finalised preparing its financial statements, the Company is required to file a tax computation and a tax form (Form CS for most companies) with the tax authorities. The deadline for filing the tax computation is before 30 Nov the year after the company’s financial year. Hence, if the Company’s year end is on 31 Dec 2018. The deadline for filing the tax computation and tax form will be 30 Nov 2019. There’s an extension provided for filing the tax computation and returns electronically till 15 Dec as well.

Based on the final tax computation submitted by the company, IRAS will raise a revised tax assessment on the company and either levy more income taxes or refund the excess collected back to the company.

Conclusion

There are penalties against the Company and its officers for not complying with the statutory requirements above and, hence, it is important that business owners and managers engage competent Xero bookkeepers and accountants that can assist in meeting the timelines.

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