Last updated
A company limited by guarantee, or CLG, is a company without shares. ACRA, the Accounting and Corporate Regulatory Authority, calls it a public company limited by guarantee and says it suits charities and non-profits. Members do not invest. They promise a set amount if the company cannot pay its debts. The rules below come from ACRA pages checked .
What is a company limited by guarantee?
ACRA's company types page lists it beside the private company and the public company limited by shares. It has no shareholders and no share capital. Members promise to pay a fixed amount if the company fails.
In plain terms: a Pte Ltd caps shareholders at 50 and needs share capital. A public company with shares has no cap and needs share capital. A CLG has no shareholders and no share capital at all.
See company types in Singapore for the full list and public company for the shares version.
How much does it cost to set up a CLG?
Here is what ACRA's fee table shows for the steps a new CLG goes through:
| Step | ACRA fee |
|---|---|
| Name reservation | S$15 |
| New company registration | S$300 |
| Yearly annual return | S$60 |
| Late-filing extension for accounts or AGM | S$200 |
The table does not separate guarantee companies from other types, so read the amount in Bizfile before paying. We have not read a provider price for CLG setup, so we print none. Providers quote their own fees and you can compare them. See company formation cost for how fees stack up for a normal company.
When does a CLG make sense?
A CLG fits groups that exist for a purpose rather than for profit, such as an association, a school body or a charity. ACRA names charities and non-profits as the use. If you want to raise money from investors or pay out profits, you want a company with shares instead, so read private limited company or public company.
Some founders pick a CLG because it has no shareholders to dilute. That is a practical point of ours, not an ACRA statement. The same lack of shares means nobody can sell their stake, so members come and go through the rules in the constitution. Decide how people join, leave and vote before you register.
Who runs a CLG?
Directors and a secretary, like any company. ACRA's page asks for one director who is 18 or older and ordinarily resident in Singapore. The secretary is a real person based in Singapore, named within six months of registration. That person cannot also be the only director. ACRA lists no special extras for guarantee companies. Check with your provider anyway.
A constitution goes up in Bizfile when you register. Take the Model Constitution or draft your own. A lawyer should read how it words the guarantee amount and what happens to any surplus, since ACRA's page does not cover those points. See company constitution.
Will a CLG be audited?
Plan on it. ACRA's audit exemption page ties the exemption to private companies, with a small company test of revenue, assets and staff numbers. A CLG is public, so we read it as excluded. ACRA does not state that outright, so confirm with an auditor. Unless exempt, the auditor must be appointed within three months of incorporation. See audit exemption.
What does the yearly filing involve?
Every live company lodges an annual return, even a dormant one. For a non-listed company it is due seven months after the year end, and a late filing risks a penalty of up to S$600. The fee is S$60. More on the annual return page and the deadlines page.
What do members actually owe?
Each member signs up to a guarantee, which is a fixed amount they promise to pay if the company fails. ACRA does not print a standard amount on the pages we read, and we will not guess one. The figure sits in the constitution, so read it before you join as a member. Because members hold no shares, they do not receive share value back either.
Is a CLG the same as a charity?
No. A CLG is a legal structure. Charity status is a separate step with the Commissioner of Charities. ACRA only says that if you plan to apply, you should check the naming rules for charities. We could not read the charities portal, so we leave out the application deadline and tax treatment. Ask the Commissioner of Charities or an adviser before you rely on either.
What should you decide before you register?
Write down these points first, because they are hard to fix later: the purpose of the company, who the first members and directors are, the guarantee amount, how members join and leave, and who signs on behalf of the company. A short meeting with a lawyer or a corporate service provider usually saves a rewrite of the constitution. We have not read a published price for that advice, so we show none. You can also compare company types one more time before you pay the S$300.
Independent guide, not ACRA
SingaporeCompanySetupGuide.com is not ACRA, the Commissioner of Charities or a provider. We write from official pages and show our check date. Providers pay us when a request we pass on becomes a client. Read how we earn.
If you want a provider to prepare the constitution and register the CLG, use the form on this page. We send your request to providers who reply with quotes.
Sources
- ACRA, company types, https://www.acra.gov.sg/register/business/registering-different-business-structures/local-company/choosing-a-company-type/ (how ACRA defines the guarantee company)
- ACRA, fee table, https://www.acra.gov.sg/manage/companies/service-transaction-fees/ (name, registration, annual return, extension)
- ACRA, officer rules, https://www.acra.gov.sg/register/business/registering-different-business-structures/local-company/appointing-company-directors-other-key-officers/ (director, secretary, auditor timing)
- ACRA, audit exemption, https://www.acra.gov.sg/manage/companies/legal-requirements-common-offences/preparing-financial-statements/audit-exemptions/ (exemption tied to private companies)
- ACRA, constitution guide, https://www.acra.gov.sg/register/business/registering-different-business-structures/local-company/company-constitution/ (Model Constitution, upload)
- ACRA, annual return filing, https://www.acra.gov.sg/manage/companies/legal-requirements-common-offences/filing-annual-returns-companies/deadline-requirements/ (seven-month deadline, penalty)
