Being one of the centre hubs for many enterprises across the wide range of conventional and modern industries, Singapore always tops the chart among other dominions in terms of political stability, economic competitiveness, transparency of regulations and various other parameters that need to be taken into consideration while establishing and growing of a business entity.
The legal setting lets a variety of business edifices or legal entities content the diverse requirements of business owners. It is a crucial task for entrepreneurs to choose the right type of entity. This mission-critical decision will enable the primary issues that include owner’s liability, business transferability, business financing as well as the tax and compliance.
The various types of entities available in Singapore include Sole Proprietorships and General Partners, Limited Liability Partners (LPPs), Limited Partners (LPs) and Companies. So if you plan on setting up a business entity in Singapore you need to keep in mind the following things.
Sole Proprietorships – This is the most common structure and one of the most popular entities. In this type, there is single owner hence the name sole proprietorship. There is no legal veil that distinguishes the business from its owner. Annual filing is exempted in sole proprietorships.
Limited Liability Partners (LLPs) – LLPs type of entity integrates the combined features of Proprietorship and Companies. It is a legal body that can hold property and even hold the right to sue and can be sued too. The partners will be taxed on their personal income tax rate from their share of income from LLP.
Limited Partners (LPs) – This type is very much similar to the general partners, where there is no limit for having the number of partners. The partners are not personally liable instead it depends upon the number of their contributions. The limited partners are not authorized to take an active role in business management.
Companies – In Singapore, this type is also one of the most commonly used entity. The shareholder is not liable for the debts of the company. They require the filing of financial statements with ACRA. The company benefits from a Special tax of flat 17%.
There are various companies in Singapore that offer advisory services which include financial reporting services, registrations services, and incorporation advisory services that enables you to choose the right type of business entity. Like our Twitter page and remain updated with us on new business things.