How to start a business? Incorporation Guides
- Doing Business in Singapore
- Starting Business in Singapore
- Which one is best for me? Comparing Private Limited, Sole Proprietorship and Limited Liability Partnership
Singapore Private Limited Company
A Singapore Private Limited Company is a business entity whose memorandum of association and articles of association limit the right of members to transfer share ownership in the company and whose membership is restricted to a maximum of 50. Unlike Partnerships and Sole Proprietorships, a private limited company is a legal entity separate from that of its shareholders/members. This means in Singapore company registration, each shareholder’s liability is restricted to their share capital. Singapore incorporation takes place under the provisions of Singapore’s Companies Act Cap 50.
Limited Liability Partnership
Like the name suggests, a Singapore Limited Liability Partnership (LLP) blends the characteristics of a partnership and a limited liability company. An LLP is a type of business entity that gives its owners the flexibility of a partnership as well as a separate legal identity (distinct from its partners) similar to that of a limited liability company.
A Singapore LLP can therefore own assets and be sued or sue. However, an LLP does not have shareholders, directors or a company secretary – the partners own and operate the business. It must have at least 2 partners.
Whereas in theory there is no restriction on the types of businesses that can be registered as a Singapore LLP, an LLP is most attractive for certain types of professionals e.g. accountants and lawyers.
Singapore Sole Proprietorship
A Singapore Sole Proprietorship is the simplest business entity that one can set up. It is a business with a single owner. Note however that a Singapore Sole Proprietorship is not considered a legal entity distinct from its owner. As such it cannot be sued in its name nor can it own or hold property. Instead, the owner and his/her personal assets bear personal responsibility for business’ risks and liabilities. Any profits generated by the business are taxed under Singapore’s personal income tax regime.