Advice on converting a sole proprietorship to PTE Ltd

[athomas]

Hi,

Need your advice for a dependent pass holder who's currently self-employed via sole-proprietorship for past 3 years and residing in Singapore. Planning to change it to PTE Ltd.

May I know what are the requirements for converting Sole Proprietorship to PTE LTD?
Can it be done without taking help an agency? Can the DP holder be the director of the company?

Thanks,
Tom

[Strong Eagle]

You are on LOC now for your SP?

[athomas]

Yes on LoC

[Strong Eagle]

The obvious question is: Why do you want to change your business legal entity?

[athomas]

To project a better image in dealing with MNCs and to hire people

[Strong Eagle]

You can hire all the people you want into a sole proprietorship.

You should read the two threads below because they contain real life information of people who tried to start up a pte ltd and failed.

http://forum.singaporeexpats.com/viewtopic.php?t=75000

http://forum.singaporeexpats.com/viewtopic.php?t=60398

The actual process is straightforward.

a) Form a Pte Ltd with ACRA.
b) Transfer all assets of the SP to the Pte Ltd in the form of paid up capital.
c) Change all your bank accounts, trade accounts, and leases.
d) Close your SP.

If you've read the threads above, you'll understand that because you are a DP on LOC, you have additional hurdles to jump over.

a) You will need a resident director to handle all the paperwork since you, as a DP, cannot legally work for a Singapore entity, and being a director is work in the eyes of the gahmen.

b) Realistically, you will want to be working on an EP for your Pte Ltd, so that you can become director and have full control over your company. Are you earning enough to qualify for an EP?

c) Have you got a solid business in place and a solid business plan?

Bottom line: If you have a viable business, experience, cash, and a plan, chances are reasonable to good that you will be able to get your EP and become a director of your Pte Ltd.

But, if you do not do your homework, you will fail. For example, buried in the threads is the story of a fellow who planned on paying himself X dollars but failed because he didn't demonstrate enough revenue to cover the salary. Or, the fellow who was told to that foreigners could only work under an Entrepass.

Neither of these are entirely correct, and they do demonstrate the importance of convincing MoM that you are a competent business person and that you have a viable business entity.

[athomas]

Thanks a lot for sharing the information. Pls correct the steps below if I am wrong.
1. Using SingPass, I need to first incorporate a company from ACRA site. In fact, I want to transfer my biz activities from SP to PTE Ltd.
2. Transfer Assets - No Assets except laptop - can I skip this step? Is this step in the ACRA Biz Profile?
3. Open a Corp Bank Account. The SP account is my own savings account, so no need to close I presume)
4. Close SP
5. Apply for EP - I do earn for EP. I can show the proof of existing biz plan and income.

After I start PTE Ltd, do I need to have a company secretary?