When setting up a business in Singapore, providing the correct registered office address is something one should not overlook. A simple mistake without double-checking can have unpleasant ramifications for business owners.
Why is a Registered Office Address Important?
According to the Companies Act 1967, all Singapore-based companies are required to have a registered office address that corresponds to an address in Singapore where the company is physically based. However, it need not be the company’s place of operations. For example, if a business owner operate a factory but have an office elsewhere, the registered office address can be that office location.
The registered office address is required for several reasons. For one, all correspondence is sent to this address, including essential legal documents that may pertain to the company’s operations and other aspects. Secondly, members of the public can visit this address to inquire about any matters related to the company, provided they do so during ordinary business hours on each business day (which excludes weekends and public holidays). The address must also be accessible for at least three hours during business days.
If a business owner manages a small-scale business, their residential address can be used as the registered office address under the Home Office Scheme. This scheme is managed by either the Housing Development Board (for residents living in an HDB flat) or the Urban Redevelopment Authority (for owners of private residential properties).
Consequences of an Incorrect Registered Office Address
The chosen registered office address can have far-reaching consequences if a business owner fails to provide the right one for their business.
Lost Correspondence
The most apparent issue business owners face is missing correspondence intended for delivery to their address. They will receive various letters and notices from government agencies on multiple aspects of their business’s operations, from bill payments to tax filings and company updates to the Accounting and Corporate Regulatory Authority (ACRA). Missing out on these can have detrimental effects later on, especially if government agencies deem a lack of reply as a reason to initiate enforcement measures. Failing to resolve these issues in time (or completely forgetting to do so due to the lost mail) could incur hefty penalties, and business owners may also lose opportunities from delayed or denied grants as well. They may even face the risk of having their business licence suspended, doing further harm to the business and its reputation.
Compliance Penalties
As the Companies Act clearly states, Singapore-based companies must have a registered office address that is registered with ACRA; failing to provide one can lead to a hefty penalty. If you move to a new location, a business owner should promptly update their new address with ACRA through the Bizfile+ system.
Do carefully consider the location of the registered office address. Choosing an area that is not zoned for business use may result in a significant penalty from the relevant authorities. You are also not allowed to use a P.O. box as the registered office address, as it is not an actual physical space where a business owner or their employees can be reached. If they have concerns about the registered office address, it is best to contact the relevant authorities to address matters in detail.
Home Office Complications
Small businesses that use the Home Office Scheme have the convenience of running a business from home, but this also comes with other concerns. For one, ACRA will list the residential address on its website as a business owner’s registered office address, making it publicly accessible to everyone. With such information readily available, business owners lose any sense of privacy, as business clients and other people often come by to speak to them about business matters. Not only that, all business correspondence gets delivered to their doorstep, and they may also lose potential clients, who may view the business with less-than-professional credibility.
Additional Expenses
If a business owner accidentally registers an office address that does not meet ACRA’s requirements, they will need to repeat the registration process to rectify the issue. That can incur additional costs to fix, but if they have already moved into that location before realising the problem, that can pose even more complications. The ACRA filing fees are one thing, but the relocation costs can easily leave a dent on the company’s finances. That excludes any letterheads and business cards they may have prepared ahead of using the new (and now unusable) location.
Professional Difficulties
Organisations like banks and regulatory bodies may require the use of a commercial address as the registered office address for specific purposes, such as applying for loans and business licences. If a business owner’s registered office address does not meet requirements, they may have a harder time getting these approved and could hinder the business’s growth.
Consider My Office For Versatile Office Requirements
My Office offers a range of cost-effective virtual office options that business owners can use as a registered office address. We also offer flexible and convenient add-ons at an affordable rate, including mail forwarding and a dedicated phone line with call forwarding. More importantly, we comply with ACRA’s strict requirements so that they can utilise our virtual office without worry. Contact us today to find out more!
