The real meaning of private limited company (Pte Ltd) lies in its advantages and straightforwardness. A huge number of entrepreneurs in Singapore prefer setting up a Pte Ltd company, hence making it the most popular business entity in the country.
Is a private limited company an incorporated business?
A private limited company is a locally incorporated business entity in Singapore. Its maximum number of shareholders is 50. They are composed of individuals, corporate entities or both. Their shares are not made available to the general public. Additionally, the company name of this type of business entity usually ends with a Private Limited or Pte Ltd.
Minimum requirements for setting up a private limited company in Singapore
- One resident director
- One company secretary
- At least one shareholder (can be an individual or a corporate entity)
- Initial capital of at least $1
- A physical office address
Advantages of a private limited company in Singapore
A private limited company has its own legal identity, meaning it is entitled to acquire assets, commit to contracts, and avail debts. Its ownership is transferable, wholly or partially. Additional shareholders can also be appointed, thus allowing company growth. Moreover, the death of the owner does not impact the company’s status and does not impair the contracts it has entered into. Know more by reading our article on the pros and cons of a private limited company.
Setting Up A private limited company in Singapore
Choosing the right business structure for you is a tough call as there are many things you need to consider. The ease of doing business, compliance issues, tax rates, and liabilities are just some of the many considerations.
Just like any other business structures in Singapore, a private limited company needs to be registered through BizFile+, the Accounting and Corporate Regulatory Authority’s (ACRA) online platform. The basic requirements you need to fulfil are the following:
- Company name
- Description of business activity and share capital
- Company Particulars (shareholders, directors, company secretary)
- Memorandum and Articles of Association
For startup business owners, here is a more thorough guide for setting up a private limited company in Singapore.
Frequently Asked Questions
What is inc.?
In business terms, inc. is an abbreviation for incorporated. The United States is among the countries that attach it to company names. In Singapore, this abbreviation is not used. The most common abbreviation that you’ll see is Pte Ltd.
Pte Ltd vs Pvt Ltd
Pte Ltd is used in Singapore to refer to private entities. On the other hand, India uses Pvt Ltd as the abbreviation.
Pte Ltd vs Pty Ltd
Pty Ltd or a Proprietary Limited Company is a business structure in Australia. It is the counterpart of Pte Ltd in Singapore.
What is a private limited company in Malaysia?
In Malaysia, they use Sendirian Berhad or Sdn bhd instead of private limited company. Similar to Singapore, it can only have a maximum of 50 shareholders.
Which type of business entity should I choose?
The right business structure depends on your business plans. If you are a local resident who wants to start a small business in Singapore, you may benefit from a sole proprietorship structure. However, you should keep in mind that you will be the only owner and in case of any liabilities, your personal assets may be at risk. By far, the incorporation of a private limited company remains to be the best choice considering the many advantages.