Exempt Private Company (EPC) mechanics — Complete 2026 guide

Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.

An exempt private company (EPC) in Singapore is a private limited company under the Companies Act 1967 with no more than 20 shareholders, none of which are corporations, and which qualifies for a series of reporting and audit reliefs. Section 4(1) of the Companies Act 1967 defines the EPC, and Section 205C grants the audit exemption that makes the form attractive to founder-owned and family-owned businesses. This 2026 guide walks through eligibility, the mechanics, the cost and timeline, and the common mistakes that cost EPC status.

What an EPC is and why it matters

An exempt private company is a sub-type of private limited company. All EPCs are Pte Ltds; not all Pte Ltds are EPCs. The exempt status flows from a single test in Section 4(1) of the Companies Act 1967: the company is private (share-transfer restricted, no more than 50 shareholders), has no more than 20 members, and no beneficial interest in any of its shares is held directly or indirectly by a corporation. If the test is met on the financial-year-end date, the company is an EPC for that year.

EPC status confers three principal benefits: (a) Section 205C audit exemption for solvent EPCs (subject to the company also meeting the small-company criteria in the Thirteenth Schedule to the Companies Act 1967); (b) simplified accounts filing — solvent EPCs file an online declaration of solvency rather than full financial statements at ACRA; (c) eligibility for the start-up tax exemption under Section 43 of the Income Tax Act 1947 for the first three Years of Assessment, where applicable.

Who an EPC is for

EPCs suit owner-managed businesses, family companies, founder-led start-ups before institutional investors come in, and single-shareholder investment-holding companies. They are not suitable for companies with corporate shareholders, more than 20 individual shareholders, or any group structure where a parent company holds the shares. Once a corporate shareholder is admitted, EPC status is lost.

Foreign founders setting up a single-shareholder holding or operating company in Singapore typically incorporate as an EPC. Single family offices applying for Section 13O of the Income Tax Act 1947 sometimes use EPCs at the investee level, although the family-office vehicle itself is usually a Pte Ltd or a VCC.

Eligibility and statutory tests

Three tests must be satisfied for EPC status under Section 4(1) of the Companies Act 1967: (a) the company is a private company (constitution restricts share transfers); (b) the company has no more than 20 members at the financial-year-end; (c) no beneficial interest in any of the shares is held, directly or indirectly, by a body corporate. The third test is the one most often missed: even a nominee corporate trustee holding shares for a beneficial-owner individual will normally break EPC status, unless the trust is structured so that the legal title is held by an individual.

Audit exemption under Section 205C is a separate test layered on top of EPC status. The Thirteenth Schedule to the Companies Act 1967 requires that the company meet at least two of three criteria for the immediately preceding two financial years: (i) revenue not exceeding S$10 million; (ii) total assets not exceeding S$10 million; (iii) employees not exceeding 50. A solvent EPC meeting these criteria can dispense with the statutory audit.

Cost and timeline (numerical specifics)

Incorporating an EPC costs the same as any Pte Ltd — S$315 in ACRA fees plus S$800 to S$2,500 in professional fees. Annual filing as an EPC is materially cheaper than as a non-EPC Pte Ltd because the audit can be dispensed with: budget S$0 (no audit) instead of S$8,000 to S$25,000 (small-company audit). Annual return filing remains a S$60 ACRA fee.

Annual maintenance for a solvent, audit-exempt EPC in 2026: S$5,000 to S$10,000 covering nominee director, company secretary, registered office, bookkeeping and tax filing. Compare with S$15,000 to S$35,000 for a Pte Ltd that requires audit. The savings compound — an audit-exempt EPC over ten years saves S$80,000 to S$250,000 versus an audited equivalent.

Timeline: EPC status applies from incorporation if the eligibility tests are met. Audit exemption applies from the second financial year (because two preceding years of meeting the small-company criteria are required) or from incorporation for newly incorporated companies that qualify as small under the transitional rules.

Step-by-step process to incorporate and maintain EPC status

First, incorporate the company as a private limited company through BizFile+ in the usual way. Second, draft the constitution to restrict share transfers and prohibit the issue of shares to corporations without board approval. Third, ensure all shareholders are individuals, holding both legal and beneficial title. Fourth, file the first Annual Return after the first AGM, indicating EPC status on the BizFile+ form. Fifth, prepare unaudited financial statements (where audit-exempt) and circulate to members; the financials are not filed with ACRA but must be available on request.

Sixth, monitor the corporate-shareholder test continuously. Any proposed share issue or transfer must be screened: a transfer to a holding company, a corporate trustee, or an investment vehicle ends EPC status from that date. Seventh, prepare a solvency declaration each year to confirm the company is solvent and qualifies for audit exemption. Eighth, file annual tax returns with IRAS — Form C-S for EPCs with revenue up to S$5 million, or Form C for larger EPCs.

Common mistakes and gotchas

The most common mistake is admitting a corporate shareholder without realising EPC status is lost. A common scenario: the founder wants to interpose a holding company for estate planning, and the holding company subscribes for shares — EPC status ends, audit becomes mandatory (unless the small-company criteria are independently met), and the simplified ACRA filing path closes. Plan share-capital changes with the EPC test in mind.

The second common mistake is nominee shareholdings that introduce a corporate. A corporate trustee or a nominee company holding shares for an individual breaks the test, even though the beneficial owner is still an individual. If you need nominee arrangements, use an individual nominee under a clean nominee declaration.

The third common mistake is forgetting that audit exemption is a separate test from EPC status. An EPC can lose audit exemption (because it grows past the S$10 million revenue or asset threshold) without losing EPC status, and vice versa. Track both tests separately. For neighbouring topics, see our employment passes and work permits hub for the staffing dimension and our family office (13O/13U/13D) coverage for the structure-design context.

FAQs

Can an EPC have a corporate director? No. Section 145A of the Companies Act 1967 prohibits corporate directors in any Singapore company — including EPCs and non-EPC Pte Ltds. All directors must be individuals.

Can an EPC have foreign shareholders? Yes. The 20-member test and the no-corporate-shareholder test do not impose nationality restrictions. A 100% foreign-owned single-shareholder company is a common EPC structure.

Do EPCs need to hold annual general meetings? Private companies (including EPCs) are exempt from holding AGMs under Section 175A of the Companies Act 1967 if all members agree in writing or if certain conditions are met. Most EPCs dispense with AGMs.

Can an EPC be a holding company? Only if it does not itself hold corporate shareholders. An EPC can hold shares in subsidiaries — its subsidiary status as a corporate shareholder of those subsidiaries breaks EPC status for the subsidiary only.

Does EPC status affect tax treatment? EPC status itself is corporate-law-only. Tax exemptions and reliefs (start-up tax exemption under Section 43 of the Income Tax Act 1947, partial exemption thereafter) apply on their own tests, independent of EPC status.

Related guides

See acra.gov.sg for the EPC filing pages, iras.gov.sg for the start-up tax exemption, and mom.gov.sg for Employment Pass requirements. Within the Raffles group see our employment passes and work permits and family office (13O/13U/13D) hubs.

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.