The business world is undergoing a dramatic transformation with a lot of changes occurring in the business scenario. Modern businesses are no more like a traditional family-owned business because corporatization is replacing the family-owned business concept.
Traces of ancestral inheritance can still be found in the corporate business, but it’s not like that in the past as modern businesses have more professional tinge.
The trend of Timcole company incorporation Singapore has lured many traditional-way businesses to make a transition to the corporate world. This transition offers legal status to the business, and business can derive certain benefits that are not otherwise available.
Benefits for a business to become a Pte Ltd company
It would be a better move to covert sole proprietorship or partnership firm into a Private Limited company (Pte Ltd Company) due to the advantages of this conversion.
- This offers a new sophisticated status to the business that helps it to grow faster.
- A company has the availability of more funding option compared to that available to a non-corporate business.
- A company gets legal protection to its assets and better option to manage liabilities with lower risk.
- A business also enjoys corporate tax incentives.
- People keep more faith in corporate businesses and it, therefore, becomes easier for a company to attract investors.
- Qualified and experienced professionals usually look for jobs in the corporate sector. A company, therefore, has a better chance to recruit quality talent.
Besides the above advantages, the company may have other advantages by acquiring legal status.
How a business can be converted into a Pte Ltd company
Considering the above benefits, it seems a better idea to covert the existing proprietorship or partnership business into a corporate business, but how to Convert to Pte Ltd Company? Incorporating a Private Limited company is much simpler compared to incorporating a Public limited company; the process is simple, and the formalities are low.
- The owner (s) of the firm would need to submit ‘No objection’ to indicate their intent to take over of their business by a company.
- They can then make an application for incorporation of private Limited company, the requirement of which in Singapore would be a Singapore registered office address, one Singapore resident director, at least one shareholder, one company secretary for secretarial compliance, and at least S$1 in initial paid-up share capital.
- Once the company is incorporated, all business assets will formally be transferred to the newly formed company and the firm will be treated as closed from the date of incorporation of the Private Limited company. The company subscribers will make move within the prescribed time to transfer assets, bank accounts, contracts/service agreements/ leases, and licenses/permits in the name of a company.
Procedure to strike-off the company
A company in Singapore, once incorporated, has perpetual existence, but it can be dissolved, called, strike-off, under certain situations. Accounting and Corporate Regulatory Authority (ACRA) deals in the company matters and the criteria for strike-off have to be checked with them. The company will then make an application for strike-off stating the reason, which will be reviewed by the ACRA and the decision will be made after considering all the factors that allow the company to strike-off.