Key Things Dormant Companies Need to Be Aware of

When your Singapore company enters a dormant state, indicating no significant accounting transactions during the financial year, there are essential steps to heed to comply with regulations set by the Accounting and Corporate Regulatory Authority (ACRA).

1. Submit Annual Returns

Despite dormancy, filing annual returns with ACRA within 30 days of the Annual General Meeting (AGM) or within 6 months after the financial year’s end is mandatory. Neglecting this duty can lead to future complications.

2. Maintain Proper Accounting Records

Even in dormancy, maintaining accurate accounting records is vital. These records encompass bank statements, invoices, receipts, and other pertinent financial documents.

Transactions that don’t affect dormant status include appointing a corporate secretary, director, or paying ACRA fees.

3. Notify ACRA of Changes

Any alterations to your company’s registered address, directors, or company secretary must be promptly communicated to ACRA within 14 days. Additionally, informing ACRA of the dormancy period and reason is imperative, with associated filing fees still applicable.

4. File Tax Returns

Dormant companies despite no income generation, are obligated to file nil tax returns with IRAS, unless they have been granted a waiver. This can be done via e-filing on the IRAS website or by submitting a printed copy of Form C-S/C.

5. Consider Company Closure

If there’s no foreseeable need for your company, consider its closure. This involves filing a striking-off application with ACRA, settling all outstanding fees and taxes, and ensuring the company isn’t entangled in legal proceedings.

6. Waiver of Income Tax Return Submission

For dormant companies not recommencing business during the next two years, a waiver can be processed online or submitted personally to IRAS. Note that GST-registered companies must cancel their GST registration before applying for the waiver.

7. Resuming Business Activities

Dormant companies resuming business must notify ACRA within a month of generating income, Business owners must complete the Request for Income Tax Return (Form C-S/C) and file a Notification of New Financial Year End forms, or enlist the assistance of a corporate services provider.

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