The interpretation of a dormant company is somehow differ between ACRA (Accounting and Corporate Regulatory Authority) and IRAS (Inland Revenue Authority of Singapore) in Singapore.
Dormancy according to ACRA
As per ACRA, a company is considered as dormant during n accounting period where no business transactions occurs. However, operating expenses to maintain the company such as secretarial fees is allowed.
ACRA further clarifies that the following transactions do not qualify a dormant company to be active. Transactions that do not impact the dormancy of a company include:
- Secretary appointment of a company
- Auditor’s appointment
- Expenses incurred in relation to maintenance of registered business address
- Expenses for bookkeeping and registers
- payment in the nature of Penalty or fine to the business Registrar
- Taking up of shares in the dormant company by a subscriber to the memorandum
Dormancy according to IRAS
Where there is no revenue or income during a given financial period, a company is considered dormant even when it may have booked or incurred expenses.mancy.