This article will guide you on all you need to know about dormant company filing requirement.
Leave it to the professionals.
Our experienced secretaries at Timcole are more than happy to help you take care of your dormant company filing. Feel free to send us any questions you have regarding the matter.
Read more about our dormant company filing service.
What Is a Dormant Company?
The definition of dormancy is somewhat different between the Accounting and Corporate Regulatory Authority (ACRA) and Inland Revenue Authority of Singapore (IRAS). It is possible that a company is considered active by ACRA, but at the same time, considered dormant by IRAS.
A Dormant company according to ACRA
According to ACRA, a company is considered dormant as long as there are no accounting transactions inside the company.
Some transactions will not affect its status as a dormant company. These transactions include:
- The appointment of a secretary of the company
- The appointment of an auditor
- Keeping a registered office intact
- The keeping of books and registers
- The payment of fees to the Registrar or an amount of any default penalty or fine paid to ACRA
- The taking of shares in the company by a subscriber to the constitution in pursuance of an undertaking in that same constitution
A Dormant Company According to IRAS
According to IRAS, companies that do not receive any income or revenue during a given financial period are considered dormant. This is the case even if the company has already booked or incurred expenses.
What are the Filing Requirements for Dormant Companies?
Obligation to File Income Tax Return
Dormant companies that have not been granted a waiver of Income Tax Return submission are still required to submit their Income Tax Return.
Let us help you.
Do not hesitate to hire our services for the submission of Income Tax Return for a dormant company.
Learn more about our tax filing services.
Applying For a Waiver of Income Tax Return Submission
If a company meets all the below qualifying requirements, there is a good chance that it will be released from its Income Tax Return obligation.
Here is a list of the qualifying requirements:
- A company must be dormant and it has to have submitted either its Form C-S or Form C, tax computations and accounts up to the date of cessation of the business.
- A company must not be an owner of any investments (even if the company does own some investments, it must not receive any profit from those investments).
- If a company has been GST-registered in the past, it has to have been de-registered for Goods and Services Tax prior to this application.
- The company must not recommence business within the next two years.
We make applying for waiver of Income Tax Return smooth and easy.
Our secretarial professionals can assist you when it comes to applying for a Waiver of Income Tax Return for your company. Feel free to contact us if you have any questions.
When a dormant company decides to recommence business or when it starts to receive income, it must notify IRAS within 1 month.
ACRA Requirement on Annual Return Filing
If a dormant company fulfils the following criteria, it is not required to prepare, audit, and file its financial statements with ACRA:
- It must not be a listed company (or a subsidiary of a listed company)
- The total assets of a company are ≤ $500,000 (at any time during the financial year)
- Which, if it is a parent company (not a subsidiary of another corporation), belongs to a group with consolidated total assets of ≤ $500,000 (at any time during the financial year)
A dormant listed company or a subsidiary company of a listed company is required to prepare its financial statements, but it does not have to do audit if it meets the audit exemption criteria.
For a dormant company that does not have to prepare financial statements, you can still choose to do so voluntarily and our professionals can assist you throughout the entire process.
Dormant companies that are required to prepare their financial statements must prepare them in accordance with Singapore accounting standards (SFRS), convene their AGM (unless exempted), and complete their annual return filings with ACRA.
All dormant companies must still file their annual returns as according to the Companies Act.
Corporate compliance requirement you need to know as a business owner: