What Does it Mean to File Your Company Dormant in Singapore?

What Does it Mean to File Your Company Dormant in Singapore?

In Singapore, a company is considered dormant if it has not been active for at least 12 months. This means that the company has not carried out any business activities during that time. There are a few reasons why a company may become dormant, such as the death of the owner or the decision to wind down the business or making Bookkeeping Mistakes. Once a company is dormant, it is no longer required to file annual financial statements or submit corporate tax returns. When a company is dormant, its registration with the Accounting and Corporate Regulatory Authority (ACRA) is still active. This means that the company still exists, but it is not allowed to carry out any business activities.

The process of filing your company dormant in Singapore

If you have a company in Singapore that is no longer active, you can file for it to be dormant. This is a process that can be completed online. You will need to provide some information about your company, including its registered address and the date of its last annual general meeting. Once you have submitted this information, your company will be officially dormant. This means that it will no longer be required to file annual returns or maintain a registered office in Singapore. In order to make the company operational, the directors must file an application for “dormant” status with the Accounting and Corporate Regulatory Authority (ACRA).

The dormant status of a company can be revoked at any time by the directors, and the company will once again become provisional.

The benefits of filing your company dormant

Filing for dormant company in Singapore has a number of benefits. For one, it can help to save on costs. If your company is not generating income, then there is no need to incur the costs of maintaining an active status. This can be a significant saving for small businesses or those just starting out. Additionally, filing your company dormant can help to protect your business name and intellectual property. If you are not actively using your company name or trademark, then another business could register it and start using it without your permission. By filing your company dormant, you can ensure that no one else can use it without your consent.

Finally, filing your company dormant can simplify your tax situation. If you are not generating income, then you likely will not have to file any corporate taxes. This can save you both time and money.

The drawbacks of filing your company dormant

One of the drawbacks of filing your company dormant is that you are not allowed to carry out any business activities. This means that you cannot generate any income or revenue for your company. Additionally, you will be required to file annual returns and keep up-to-date financial statements, which can be a hassle and expensive. Finally, if your company is ever wound up or struck off the register, it will have a negative impact on your credit score.

In conclusion, it is important to understand what filing your company dormant in Singapore entails. This includes understanding the financial and legal implications of doing so. Filing your company dormant can be a viable option for businesses that are not currently active but may be looking to restart operations in the future. However, it is important to seek professional advice before taking this step to ensure that it is the best course of action for your business.

 

Ishat Narain