Dormant companies in Singapore: what you still must file (and when to strike off instead)

"Dormant" means two different things

The first thing to understand is that Singapore has no single definition of a dormant company. The two regulators you answer to each apply their own test:

• ACRA (Companies Act): a company is dormant for a period in which no accounting transaction occurs. Certain housekeeping items are disregarded — for example the appointment of a company secretary or auditor, the maintenance of a registered office and statutory registers, and fees or penalties paid to ACRA. Anything else — a bank charge, an expense, an intercompany movement — breaks dormancy.
• IRAS (tax): a company is dormant for a Year of Assessment if it had no income or revenue in the relevant basis period. A company can incur some expenses and still be dormant for tax purposes — what matters is that nothing came in.

The tests diverge in practice. A company that earns no revenue but pays, say, bank fees and a corporate secretarial invoice is dormant in IRAS's eyes but not dormant under ACRA's stricter "no accounting transactions" test. Check your position against each definition separately before assuming any relief applies.

What ACRA still requires

The annual return does not go away

Every Singapore company — dormant or not — must file an annual return with ACRA within seven months of its financial year end. For a dormant company the filing is simpler and the directors confirm the company's dormancy, but skipping it attracts the same late-lodgement penalties as it would for an active company, and persistent default can lead to enforcement against the directors. (For the mechanics of the annual return itself, see our guide to Singapore's Annual Return.)

Financial statements: exemption if you pass two tests

This is the most valuable ACRA relief. Under section 201A of the Companies Act, the directors of a dormant company are exempt from preparing financial statements altogether if the company:

• Has been dormant since incorporation or since the end of the previous financial year (on ACRA's "no accounting transactions" test);
• Is not a listed company or a subsidiary of a listed company; and
• Satisfies the substantial assets test — total assets of not more than S$500,000 at any time within the financial year (assessed on a consolidated basis for a parent company).

A dormant company that fails the assets test — for example, a dormant holding company sitting on a property or a large intercompany receivable — must still prepare financial statements, though it is generally exempt from having them audited. Dormancy is one of the audit exemptions that sits alongside the small-company exemption we cover in our audit exemption guide.

Records must still be kept

Even where the preparation exemption applies, the company must keep accounting and other records that sufficiently explain its position — and ACRA can require financial statements to be prepared by notice. The exemption removes a deliverable, not the underlying record-keeping duty.

What IRAS still requires

The default: a tax return every year, even with nil income

Unless a waiver has been granted, a dormant company must file its corporate income tax return by 30 November each year like any other company. IRAS provides a simplified File Form C-S/C for Dormant Company e-filing for this — a short return confirming the company had no income — but it must still be filed. On the plus side, a dormant company with no income generally has no ECI to file, and no tax to pay.

The waiver: switching the tax return off

A company that expects to stay dormant can apply to IRAS for a waiver of the obligation to file, via the Apply for Waiver / File last Form C-S/C (Dormant / Striking Off) digital service at myTax Portal. Broadly, IRAS expects that the company:

• Holds no investments (such as shares or property) — or, if it does, that they generate no income;
• Does not intend to recommence business within the next two years;
• Has filed all returns, financial statements and tax computations up to the date it ceased trading; and
• Has deregistered from GST, if it was GST-registered.

Note the sequencing: after submitting the waiver application, the company has 21 days to file any outstanding returns for advance Years of Assessment, failing which the application is rejected. Once granted, the waiver removes the annual filing obligation — but not the duty to tell IRAS when circumstances change, which brings us to reactivation.

The obligations that never pause

Whatever reliefs apply, a dormant company remains a live legal entity and must maintain:

• A registered office in Singapore;
• A company secretary (see why every company needs one);
• At least one director ordinarily resident in Singapore;
• Its statutory registers, including the register of registrable controllers; and
• Up-to-date particulars with ACRA — changes of director, address or shareholding must still be lodged on time.

These are also why dormancy is never free: registered office, corporate secretarial and filing support typically cost several hundred to over a thousand dollars a year, every year the company sleeps.

Reactivating a dormant company

Waking a dormant company up is administratively easy — there is no "reactivation" filing as such. But two duties bite immediately:

• Notify IRAS within one month of recommencing business or starting to earn or receive income, by emailing IRAS to request a tax return — this applies in particular where a filing waiver was in force.
• Resume full compliance — financial statements (the section 201A exemption falls away once transactions resume), ECI where applicable, GST registration if taxable turnover will cross the threshold, and CPF obligations if staff are hired.

Directors sometimes restart trading through a dormant entity casually — a one-off consulting invoice, a short project — without realising they have restarted the entire compliance clock. If the entity is going to trade at all, treat it as active.

Keep it dormant, or strike it off?

Dormancy is a holding pattern, not a destination. It makes sense when the entity has option value:

• You may restart the business within the next year or two;
• The company holds a licence, brand, name or track record worth preserving — incorporation history and a clean compliance record cannot be recreated later;
• The entity has a role in a holding or family structure that may be needed again; or
• You are parking the company pending a sale or restructuring decision.

If none of those apply — the venture has genuinely ended and no one expects to reuse the entity — then paying annual compliance costs indefinitely is money spent maintaining nothing. A strike-off is usually cheap and clean precisely because the company is dormant: no assets, no liabilities, and a tax position that is easy to settle. The two-year horizon in IRAS's waiver conditions is a useful rule of thumb — if even you don't expect activity within two years, ask seriously whether the company should exist at all. We compare the closure routes in detail in strike-off vs members' voluntary liquidation.

Common mistakes to avoid

• Assuming dormant means nothing to file. The annual return and (absent a waiver) the tax return continue every year. Late filings accumulate penalties against a company that isn't even earning.
• Mixing up the two definitions. Qualifying as dormant with IRAS does not mean the company passes ACRA's stricter no-transactions test — and bank charges alone can fail it.
• Claiming the financial statements exemption while failing the assets test. A dormant company with more than S$500,000 in total assets must still prepare (unaudited) financial statements.
• Forgetting GST deregistration. A GST-registered company that goes quiet must still file GST returns until it cancels its registration — and deregistration is a condition of the IRAS filing waiver.
• Not telling IRAS when income resumes. The one-month notification deadline after recommencing business is short and easy to miss.
• Letting a dead company drift for years. Every drifting year costs secretarial and filing fees and risks penalties. Decide: dormant with a purpose, or struck off.

The bottom line

A dormant company is cheaper to run than an active one, but it is not free and it is not exempt. ACRA still expects an annual return within seven months of year end; IRAS still expects a tax return by 30 November unless it has granted a waiver; and the registered office, secretary and resident director must stay in place throughout. The genuine reliefs — audit exemption, the section 201A financial statements exemption, and the IRAS filing waiver — each have conditions worth checking rather than assuming. And if the honest answer is that the company will never trade again, the kindest thing you can do for your annual budget is to strike it off properly.

At Chua and Lee Associates, we manage dormant-company compliance end to end — annual returns, dormant tax filings, waiver applications and, when the time comes, strike-offs. To learn more, see our Corporate Secretary services, Tax services and Accounting services.