Winding Up Over Unpaid Rent: Defences for Tenant Companies

Short answer: A landlord owed more than S$15,000 in rent that is due can serve a statutory demand on a tenant company and, if the company fails to pay, secure or compound the debt within 3 weeks, apply to wind it up. The tenant can resist by showing the rent is disputed on substantial grounds, by raising a serious cross-claim, or by offering acceptable security.

Winding up over unpaid rent is a pressure tactic some landlords use instead of an ordinary claim for arrears. For a tenant company the risk is out of proportion to the debt, even where the rent figure is wrong. This guide, for directors of the tenant, skips the general winding-up process and focuses on what is specific to rent: disputed sums, set-off for defects and service charges, the security deposit, lease terms, and payment plans that stop the clock.

Raffles Corporate Services works with a panel of experienced Singapore law firms who offer cost-effective and efficient legal service and advice. This article is general information only and is not legal advice.

Can a landlord start a winding up over unpaid rent?

Yes. Rent that has fallen due and is unpaid is a debt like any other, so a landlord can use the statutory demand route in section 125 of the IRDA to create a presumption that the tenant company cannot pay its debts.

A statutory demand is a formal written demand for payment. If it is not dealt with in time, the landlord can rely on it as proof of insolvency in a winding-up application to the General Division of the High Court. In a lease three details matter:

• The sum must exceed S$15,000 and be “then due”. Rent for future months does not count unless the lease has an acceleration clause that has been validly triggered.
• The demand must be left at the company’s registered office. The 3 weeks run from service, so a tenant that uses a virtual or corporate secretary’s address needs its mail scanned and forwarded promptly.
• The company avoids the presumption by paying, or by securing or compounding for the sum to the landlord’s reasonable satisfaction. An instalment offer counts only if it meets that test.

The landlord can also rely on an unsatisfied enforcement of a judgment (s 125(2)(b)) or prove inability to pay in other ways (s 125(2)(c)). If a demand has just arrived, read our guide to your first 7 days after being served with a statutory demand and diarise the deadline before doing anything else.

What is the legal basis for resisting the landlord?

The winding-up ground is IRDA s 125(1)(e), proved through the deemed inability to pay in s 125(2). The tenant’s main protection is an injunction restraining the landlord from filing the application, sought under the Rules of Court 2021, Order 13 rule 1.

Unlike an individual facing bankruptcy, a company has no procedure to set aside a statutory demand. In Aryan (SEA) Pte Ltd v Pure Group (Singapore) Pte Ltd [2025] SGHC 99 (unreported), the High Court endorsed that position and granted an injunction instead. The judgment restates the tests a tenant will meet:

• Where there is no arbitration agreement, the company need only raise triable issues, the standard used to resist summary judgment (Pacific Recreation Pte Ltd v S Y Technology Inc [2008] 2 SLR(R) 491).
• An injunction will lie where the debt is disputed on bona fide and substantial grounds, or where the company has a serious cross-claim on substantial grounds equal to or exceeding the undisputed debt (Metalform Asia Pte Ltd v Holland Leedon Pte Ltd [2007] 2 SLR(R) 268).
• Where the dispute falls within an arbitration agreement, the lower prima facie standard applies, subject to abuse of process (AnAn Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Co) [2020] 1 SLR 1158).
• It is an abuse to pursue winding up against a solvent company that offers to secure the creditor’s claim before it is decided (BNP Paribas v Jurong Shipyard Pte Ltd [2009] 2 SLR(R) 949).

Read the lease’s dispute resolution clause first, because an arbitration clause changes the standard. For the wider procedure, see our article on restraining a winding-up application as an abuse of process.

Which rent disputes count as a defence to winding up over unpaid rent?

The defences that work come from the lease and the history of the tenancy: a real dispute about how much is owed, a cross-claim against the landlord at least as large as the undisputed arrears, or security that shows the company is solvent. A bare refusal to pay, or a complaint invented after the demand arrived, will not do.

Two points decide most cases. The numbers: if the undisputed part still exceeds S$15,000, a partial dispute does not defeat the demand, and a cross-claim generally needs to equal or exceed the undisputed sum. The timing: a defect complained of in writing months earlier carries far more weight than one first raised in reply to the demand.

Can the security deposit be set off against the arrears?

Only if the lease allows it. Most commercial leases let the landlord apply the deposit at its option and expressly stop the tenant from treating the deposit as payment of rent, so the tenant usually cannot insist on set-off.

The deposit is still relevant in three ways. It shows the landlord’s real exposure is lower than the headline arrears. It can support an offer to “secure” the debt under s 125(2)(a), for example by agreeing that the landlord may draw on it, with a top-up. And if the landlord has already drawn on a banker’s guarantee or cash deposit, the demand may overstate what is still owing. Disputes over getting the deposit back at the end of a lease are a separate topic, usually about reinstatement works.

Will a payment plan stop the winding-up application?

A payment plan stops the statutory demand presumption only if, within the 3 weeks, the company pays, secures or compounds for the debt to the landlord’s reasonable satisfaction. A proposal sent on day 20 and not answered is not enough.

Offers that tend to persuade a landlord include:

1. An immediate part payment, with the balance in fixed monthly instalments on top of current rent.
2. Security for the balance, such as a banker’s guarantee, a deposit top-up or a director’s guarantee. A director who signs takes on personal exposure and should get independent advice; see our guide to a statutory demand served on a personal guarantor.
3. Surrender of part of the premises, or an early surrender, in exchange for a release of some or all of the arrears.
4. A written settlement that records the plan, what happens on default, and the landlord’s agreement not to proceed on the demand while instalments are paid.

Get any agreement signed by the landlord itself, not only its leasing agent, and pay exactly on time.

How does a tenant company apply to stop the landlord filing?

A Singapore Advocate and Solicitor files an originating application in the General Division of the High Court, supported by an affidavit, asking for an injunction restraining the landlord from making a winding-up application on the demand. It should be filed before the landlord applies.

1. Day 1: record the date and manner of service and diarise the end of the 3-week period.
2. Days 1 to 3: collect the lease, letter of offer, rent ledger, deposit records and every written complaint to the landlord.
3. Days 3 to 5: reconcile the landlord’s statement with the company’s ledger and isolate the disputed items.
4. Days 5 to 7: the board decides whether to pay, offer terms or dispute, and records the decision in a directors’ resolution.
5. Days 7 to 10: the company’s solicitor writes to the landlord setting out the dispute or cross-claim and asking for an undertaking not to file.
6. If no undertaking is given: the solicitor files the injunction application, with evidence of the dispute and of the company’s solvency.
7. Hearing: the court applies the relevant standard and may grant the injunction, sometimes on terms such as payment of the undisputed sum.

Raffles Corporate Services does not file court documents or appear in court. Court proceedings are conducted by a Singapore Advocate and Solicitor. If you need one, speak to a lawyer early, before the 3 weeks run out.

What documents are needed, and who prepares them?

The solicitor drafts the court papers, but most of the evidence comes from company records that the company secretary and accountant can assemble quickly.

How long does it take and what drives the cost?

The only fixed period is the 3 weeks from service of the demand. Court timelines after that depend on the court’s calendar and on whether the landlord contests, so plan around the deadline, not the hearing date.

Court fees depend on the documents filed, so ask your solicitor for the current official fees. A negotiated plan usually costs far less than a contested hearing, and the losing party may be ordered to pay the other side’s costs.

What other remedies can the landlord use against the tenant?

A landlord has two lease remedies outside insolvency: distress, which lets it seize and sell the tenant’s goods on the premises under a court-issued writ, and forfeiture, which ends the lease.

Distress is covered in our guide to the writ of distress in Singapore; the key limit is that it covers no more than 12 completed months of rent before the application (Distress Act 1934 s 5(1)). Forfeiture is covered in forfeiture of lease for rent arrears. The general notice requirement in the Conveyancing and Law of Property Act 1886, section 18 does not affect the law on re-entry, forfeiture or relief for non-payment of rent (s 18(9)), so rent arrears follow their own rules.

The remedies interact. Once a court winding up has commenced, distress put in force against the company’s property afterwards is void unless the court orders otherwise (IRDA s 130(2)). A landlord that wants its rent and its premises back has reasons to prefer a deal, which gives the tenant room to negotiate.

What happens if the landlord files anyway?

Once a winding-up application is made, the winding up is treated as having started from that date (IRDA s 126(2)), and dispositions of company property after that date, including payments from its bank account, are void unless the court orders otherwise (IRDA s 130(1)).

The company can apply for a validation order under section 130 to keep essential payments, including current rent and salaries, running, and can still oppose the application on the same grounds of dispute or cross-claim. If a winding-up order is made, the directors’ powers end and a liquidator takes control. If the application fails, ask your accountant whether the disputed rent needs a provision or disclosure in the financial statements.

What mistakes do tenant companies make?

Most failures come from lost time, not weak facts.

• Not checking registered office mail, so half the 3 weeks pass before anyone reads the demand.
• Withholding all rent over a repair dispute worth far less than the arrears.
• Agreeing a payment plan by phone with the leasing agent and never getting it signed by the landlord.
• Raising complaints about the premises for the first time in reply to the demand.
• Forgetting the director’s personal guarantee, which can lead to a separate demand against the director personally.

A lease dispute does not pause other company deadlines; our free compliance tools work out your AGM, annual return and tax dates. Our sister site Singapore Secretary Services covers registered office and governance topics.

Frequently asked questions

Is S$15,000 of rent arrears enough for a statutory demand?

No. The sum must exceed S$15,000 and be then due (IRDA s 125(2)(a)). At S$15,000 or less, the landlord cannot use the statutory demand presumption, although it can still sue for the rent or try to prove inability to pay in other ways.

Can the landlord keep my deposit and still serve a statutory demand?

Usually yes, if the lease lets the landlord decide whether and when to apply the deposit. Whether the deposit reduces the undisputed sum, or supports an offer of security, depends on the exact clause, which your solicitor should review.

Can my company set aside a statutory demand from the landlord?

No. There is no express procedure for a company to set aside a statutory demand. The company applies for an injunction to stop the landlord filing a winding-up application, as the High Court confirmed in Aryan (SEA) Pte Ltd v Pure Group (Singapore) Pte Ltd [2025] SGHC 99 (unreported).

Does a repair dispute let us stop paying rent?

Not safely. A cross-claim for repairs can resist a winding-up application if it is serious and equals or exceeds the undisputed arrears, but withholding rent risks distress, forfeiture and a statutory demand on the undisputed part. Get advice before withholding anything.

Last reviewed: 27 October 2026. The Editorial Team, Raffles Corporate Services.