Types of Business & Companies in Singapore
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Singapore is very pro-business in both its tax regime and its variety of business organization types that may be registered in Singapore. Types of business structures are:
Any individual who is a Singaporean or Singaporean PR may start his own business by registering with the Registrar under the Business Registration Act. Before a business can be registered, the applicant (the sole proprietor) must apply to the Registry to ensure that the proposed name is available and that his/her medisave payments are up to date.
The sole proprietor is entitled to all the profits of the business and is personally liable, without limit, for all its debts and obligations.
Two or more persons (up to a maximum 20) who combine some or all of their resources, skill or industry with the object of making a profit, may enter into a partnership. The profit will be shared by all the partners. All the partners are also personally liable for the debts and obligations of the partnership.
*Note: Sole proprietorships and partnerships are not corporate bodies. There is no requirement for filing annual accounts but they must renew their registrations annually and report to the IRAS for annual returns.
A limited partnership consists of general partner(s) and limited partner(s). There is no limit on the number of the partners.
A general partner who may be either a corporation or an individual, will be personally liable for all the debts and liabilities while he/she/it remains a general partner. Meanwhile, a limited partner will not be liable for the debts and other liabilities of the partnership beyond the amount of his/her agreed contribution.
LLPs give owners the flexibility of operating as a partnership whilst giving them limited liability. It combines the benefits of a partnership with those of private limited companies. Liability of the partners are limited to the amount they contributed to the LLP. The partners are not personally liable to the obligations of the LLP. A partner is personally liable for claims from losses resulting from his/her own negligence or wrongful act which will not affect any other partners.
However this comes with safeguards in law to minimize abuse and provide protection to parties who deal with the LLP. The LLP is a body corporate and has legal personality separate from its partners. The LLP has perpetual succession. Any change in the partners of a LLP does not affect its existence, rights or liabilities.
The company is treated as an entity separate from the members that make up the company and as a "person" in law.
One or more individuals (at least one Director must be a Singaporean, Singapore Permanent Resident or EntrePass Holder) may incorporate a company by registering under the Companies Act. A company may be limited by shares, limited by guarantee or unlimited. For companies limited by shares, shareholders may be individuals or corporate entities, and need not be of local residency.
In Singapore, the main types of companies are:
Public companies include :
A company, corporation, society, association or other body incorporated outside Singapore; or an unincorporated society, association or other body which under the law of its place of origin may sue or be sued, or hold property in the name of the secretary or other officer of the body or association appointed for the purpose; and does not have its principal place of business in Singapore.
A Representative Office is an interim entity from which foreign companies that are keen on exploring the viability of doing business in Singapore can test the market before committing to any investment decisions.
For more information, please visit our Setting Up a Representative Office in Singapore page.
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