Nominee director services — foreigner essentials — Costs and fees breakdown

Nominee director services let a foreign-owned Singapore company satisfy the legal requirement for a locally resident director without the foreign owner relocating. Nominee director services are a compliance bridge: the nominee holds the statutory office for residency purposes while the foreign shareholders retain full beneficial ownership and day-to-day control of the business.

Why foreigners need a nominee director

Section 145 of the Companies Act 1967 requires every Singapore company to have at least one director who is ordinarily resident in Singapore. A foreign founder who has not yet obtained an Employment Pass cannot meet this on their own, so nominee director services fill the gap. The nominee is a non-executive, locally resident director appointed purely to satisfy the residency rule; the foreign founder remains a director or shareholder with control of the business.

This is a common and entirely legitimate arrangement for newly incorporated foreign-owned companies. Founders intending to relocate and act as their own resident director in time should read our EntrePass Singapore 2026: A Founder’s Complete Walkthrough on work passes, since obtaining a pass is usually the exit route from the nominee arrangement.

How nominee director services work

Corporate services firms provide nominee directors under a service agreement and an indemnity, supported by a refundable security deposit. The nominee does not run the business, does not sign commercial contracts as a matter of course, and is not a bank signatory; their role is limited to statutory compliance. Section 157 of the Companies Act 1967 imposes duties of honesty and reasonable diligence on every director, including a nominee, which is why reputable providers insist on proper bookkeeping and timely filings.

Because the nominee carries genuine statutory exposure, they will require visibility of board resolutions and the company’s compliance status. Many founders pair a nominee with their own EntrePass application; see the Section 13U enhanced-tier fund scheme — Costs and fees breakdown for that pathway.

Nominee director services — risk management and the indemnity

The arrangement is governed by an indemnity from the beneficial owners and a refundable security deposit that protects the nominee against the exposure they assume. The nominee will typically not access company funds, will decline to sign documents outside ordinary statutory matters, and may step back once the founder secures their own Employment Pass and can act as the resident director.

This is a temporary compliance tool, not a permanent governance solution, and the best arrangements have a clear exit built in from the start. Our Singapore Corporate Governance After CALA 2025: A Director’s Practical Risk Mitigation Checklist sets out the foreigner essentials end to end, including how the nominee interacts with the company’s accounting and filing cycle.

Cost of nominee director services — the numerical breakdown

Nominee director fees are an annual charge plus a refundable deposit. The appointment can usually be made at incorporation, so it adds nothing to the set-up timeline. The deposit is returned on a proper resignation, so it should be treated as security held rather than a sunk fee.

Founders should view the cost as the price of meeting the resident-director rule while they arrange their own pass, and should confirm the current resident-director requirement with ACRA at Accounting and Corporate Regulatory Authority (ACRA) and pass options with MOM at Ministry of Manpower.

Common mistakes and gotchas

A frequent mistake is expecting the nominee to run the company or sign contracts; they will not, and pressing them to do so is a red flag for any reputable provider. Another is failing to keep books in order, which exposes the nominee and prompts resignation. A third is treating the security deposit as a fee rather than refundable security. A fourth is having no plan to replace the nominee once the founder qualifies as a resident director.

Indicative 2026 nominee director costs

  • Annual nominee director fee: S$1,800–S$3,000 per year.
  • Refundable security deposit: S$2,000–S$5,000, returned on proper resignation.
  • Resident directors required: at least 1 under the Companies Act 1967.
  • Appointment timing: at incorporation, adding no extra time to set-up.
  • Typical exit: once the founder obtains an Employment Pass and can act as resident director.

For tax-efficient holding structures behind the operating company, see IRAS guidance at Inland Revenue Authority of Singapore (IRAS).

FAQs

Why does my Singapore company need a nominee director?
Section 145 of the Companies Act 1967 requires at least one ordinarily resident director, which a foreign founder without a work pass cannot satisfy alone.

Does a nominee director control my company?
No. The nominee is non-executive and exists only for statutory compliance; the foreign founder retains ownership and control.

Is the security deposit a fee?
No. It is a refundable amount held against the nominee's statutory exposure and returned on a proper exit.

When can I remove the nominee?
Typically once you obtain your own Employment Pass and can act as the locally resident director yourself.

Need help with this? Call, SMS or WhatsApp +65 8501 7133, or email [email protected]. Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.