For Dependant’s Pass (DP) holders, the days of automatically getting a Letter of Consent (LOC) to work in any job are gone.

However, the Ministry of Manpower (MOM) still encourages entrepreneurship. If you want to start and run your own Private Limited Company, you have two strategic paths in 2025:

  1. The LOC Route: Best for new startups (You get a 1-year “runway” before hiring locals).

  2. The EP Route: Best for those who want independent visa security from Day 1.

Here is the complete breakdown of how to execute either strategy.

Option 1: The Letter of Consent (LOC) Route

Best for: Testing a business idea with lower initial costs.

You can apply for an LOC to be the active Director of your own Private Limited Company.

The Eligibility (First-Time Application): To get your first LOC approved, the bar is relatively low. You do not need to hire a local employee immediately. You simply need to be:

  1. A Director of the company; AND

  2. A Shareholder owning at least 30% of the shares.

  3. Note: The LOC will be granted for 1 year (or until your DP expires).

The “Renewal Cliff” (The 1-Year Rule): The challenge comes 1 year later. To renew your LOC, you must prove you are creating jobs. At the time of renewal, you must have employed at least one Singaporean or Permanent Resident who:

  • Earns at least the Local Qualifying Salary (LQS) (currently ~S$1,600); AND

  • Has received CPF contributions for at least 3 months prior to renewal.

Pros:

  • Low Entry Barrier: You can start your business today without the cost of a local employee.

  • 1-Year Runway: You have 12 months to generate enough revenue to afford a local assistant.

Cons:

  • Tied to Spouse: If your spouse loses their job, your LOC is cancelled immediately.

  • Renewal Pressure: If you fail to hire a local in time, you lose your right to work in your own business after Year 1.

Option 2: The Employment Pass (EP) Route

Best for: Serious founders wanting visa independence.

If you want security independent of your spouse, or if you plan to pay yourself a high salary, you should aim for an Employment Pass.

Stage A: The “Passive” Setup

  1. Incorporate the company holding 100% shares.

  2. Appoint a Nominee Director to satisfy the local director requirement (since you cannot be the director yet).

  3. You are the Shareholder (Owner), but you do not run operations yet.

Stage B: The “Active” Transition

  1. Once the business has capital, the company applies for an Employment Pass (EP) for you.

  2. Upon approval, you replace the Nominee Director. You are now the active Director on your own visa.

Pros:

  • Independent: Your visa is tied to your company. You are safe even if your spouse leaves Singapore.

  • No Mandatory Local Hire: While hiring locals helps your score, it is not a hard “1-person” rule like the LOC renewal.

Cons:

  • Higher Bar: You must meet the EP salary criteria (min S$5,000+) and pass the COMPASS framework points test.

Summary: Which Path is for You?

DP Holder Business Owner Options Singapore LOC vs EP Flowchart

Conclusion: Plan Your Year 2 Today

The LOC route is excellent for getting started quickly, but many founders forget the “Renewal Cliff” and scramble to hire someone in Month 11.

  • Choose LOC if you want to start lean and are confident you can hire a local admin/assistant within 9 months.

  • Choose EP if you want visa security and have the capital to pay yourself a market-rate salary immediately.

At Excellence Singapore, we support both journeys. We can provide the Nominee Director for the EP route, or manage the Payroll & CPF for your local hire to ensure your LOC renewal is safe.

Unsure which route qualifies you? Contact our Visa Team for a Free Assessment.