Exempt Private Company (EPC) mechanics — Step-by-step walkthrough

An exempt private company is a Singapore private company limited by shares with no more than 20 members and no corporation holding a beneficial interest in any of its shares. That status carries two practical privileges: a solvent exempt private company is excused from filing its financial statements with ACRA, and it is freed from the usual statutory prohibition on loans to its directors.

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

What an exempt private company is

Section 4(1) of the Companies Act 1967 defines an exempt private company as a private company whose membership does not exceed 20 and in which no corporation holds a beneficial interest in its shares (or, alternatively, a wholly government-owned company declared to be exempt). The “exempt” label does not mean exempt from tax or from incorporation – it means exempt from certain disclosure and lending restrictions that apply to other companies. For most foreign founders, the EPC is simply the ordinary private limited company they incorporate, provided the shareholding stays within these limits. If you are weighing the EPC against other forms, our companion Sole proprietorship vs LLP vs Pte Ltd walkthrough compares the alternatives.

Who the exempt private company suits

The EPC suits owner-managed businesses, founder-and-family companies, and small groups of individual investors who want the liability protection of a company without a corporate shareholder on the register. It is the default structure for most foreign entrepreneurs incorporating their first Singapore company. Where a foreign parent company will hold the shares, the company cannot be an EPC, because a corporation would hold a beneficial interest – those situations are addressed in Singapore Pte Ltd company registration for foreigners.

Eligibility and the two key privileges

To qualify and stay qualified as an EPC:

  • The company must be private (its constitution restricts share transfers and caps members at 50 overall), and the EPC sub-category caps members at 20.
  • No corporation may hold a beneficial interest in its shares – only individuals (or, narrowly, the Government) may be beneficial owners.

The privileges that follow are meaningful. First, a solvent EPC is exempt from filing its financial statements with ACRA and instead lodges an online declaration of solvency at its annual return. Second, the EPC is exempt from the general prohibition in the Companies Act 1967 on a company making loans to its directors or to entities connected with them – a restriction that binds ordinary companies. Audit, by contrast, is governed separately: since 2015 the audit-exemption test turns on the “small company” criteria in the Companies Act 1967 (broadly, meeting two of three thresholds – annual revenue of S$10 million or less, total assets of S$10 million or less, and 50 or fewer employees), not on EPC status itself.

Cost and timeline (numerical specifics)

Indicative 2026 figures to incorporate and run an EPC:

  • ACRA name application: S$15; company incorporation fee: S$300.
  • Professional incorporation package (including constitution and first filings): from S$700.
  • Company secretary retainer: from S$800 per year (a secretary must be appointed within six months of incorporation).
  • Registered office and corporate compliance: from S$240 per year.
  • Indicative timeline: incorporation in 1 to 3 working days once the name is approved and directors are verified; same-day in straightforward cases.

Step-by-step process

  1. Confirm EPC eligibility. Check that members will not exceed 20 and that no corporation will hold a beneficial interest in shares.
  2. Reserve the company name. Apply through BizFile+ and clear any name-sensitivity referrals.
  3. Appoint at least one local director. Section 145 of the Companies Act 1967 requires at least one director ordinarily resident in Singapore.
  4. Set the share capital and members. Issue shares to the individual shareholders; paid-up capital can start from S$1.
  5. Adopt a constitution. Use the model constitution or a tailored one restricting share transfers.
  6. Incorporate via BizFile+. Lodge the incorporation with ACRA and receive the unique entity number.
  7. Appoint a company secretary. Within six months of incorporation, as the Companies Act 1967 requires.
  8. Open a bank account and register for taxes. Including GST if turnover will exceed the registration threshold.

Common mistakes and gotchas

The most common slip is letting a corporate shareholder onto the register – for example, when a founder later transfers shares to a holding company – which quietly ends EPC status and reinstates the FS-filing obligation. A second is assuming “exempt private” means “exempt from audit”; audit depends on the separate small-company test. A third is missing the six-month deadline to appoint a company secretary. Founders who will hold an Employment Pass to run the company should also plan the work-pass step early – our colleagues set out the rising bar in Singapore EP and S Pass salary thresholds rising in 2027.

Tax treatment and holding-company use

An EPC is taxed like any Singapore company, at the headline corporate rate with the usual start-up and partial exemptions. Many founders use an EPC as a holding vehicle for investments or subsidiaries; the planning points are covered in our group guide to Singapore holding company tax optimisation. Registration and filing obligations are administered by ACRA and tax by the Inland Revenue Authority of Singapore.

FAQs

Is an exempt private company exempt from tax? No. The exemption relates to filing financial statements and to the loans-to-directors prohibition, not to corporate tax.

How many shareholders can an EPC have? Up to 20, and none may be a corporation holding a beneficial interest in the shares.

Does an EPC still need audited accounts? Only if it fails the small-company test in the Companies Act 1967; many EPCs qualify for audit exemption but still prepare unaudited financial statements.

Can a foreigner own 100% of an EPC? Yes, individuals of any nationality may own the shares, but at least one director must be ordinarily resident in Singapore.

What happens if a company holds EPC shares? The company loses EPC status and must file its financial statements with ACRA like an ordinary private company.

Related guides

For the registered-office and filing obligations every new company faces, see our MOM-aligned hiring notes and the wider incorporation library on this site.

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.