Incorporation of Company

Incorporation of Company

To set up a company and start doing business in Singapore, a company must first be incorporated.

Private Limited Company is the most popular business entity in Singapore. Unlike business entities such as a Sole Proprietorship and Partnership, it has a separate legal status from its shareholders and directors who have limited liabilities for the debts and losses of the company. It has the rights to own properties. It usually has the words ‘Pte Ltd’ or ‘Ltd’ as part of its name. In many European countries or the US, it is commonly known as a corporation.

Features of a Private Limited Company
  • A legal entity separate and distinct from its shareholders and directors
  • It can sue or be sued in its own name
  • A minimum of 1 and a maximum of 50 shareholders
  • A subsidiary company, with at least one individual shareholder with minimum of 10 percent shareholding, is entitled to local tax and development incentives
  • Partners have limited liability
  • It can own property
  • A newly startup Private Limited Company is eligible for local tax exemptions and incentives

A Limited Liability Partnership (LLP) is a perfect blend of a Partnership with Private Limited Company setup. A LLP gives owners the flexibility of operating as a Partnership while having a separate legal identity like a Private Limited Company. This type is highly suitable for individuals engaged in professional services such as lawyers, architects, accountants and management consultants. Singapore citizens, residents, and employment pass holders can register a LLP. Foreign individuals and companies may also register a LLP but must appoint a local manager.

Features of a LLP
  • It has a separate legal entity
  • Partners have limited liability
  • Minimum of 2 partners, no maximum limit
  • Partners can be individuals or body corporate (company or other LLP)
  • Can sue or be sued in its own name
  • Can own property

A Sole Proprietorship is the simplest form of business entity with only one owner who is the decisive authority and responsible for all assets and liabilities belonging to the business. Singapore citizens or permanent residents; holders of Employment Pass, EntrePass or Dependant’s Pass may register a Sole Proprietorship. Foreigner individuals and companies may also register a Sole Proprietorship but must appoint a Singapore resident manager.

Features of a Sole Proprietorship
  • It does not have a separate legal entity
  • The owner has unlimited liability
  • It cannot own property
Sole Proprietorship Requirements
  • Owner must be at least 18 years of age
  • Singapore Citizen/PR/EntrePass Holder/Dependant Pass Holder
  • Singapore Company/LLP can also register a business.
  • Singapore registered office address
  • Foreigner residing overseas can partner with locally resident person or Appoint local manager
  • Medisave must be paid up with CPF Board for yearly renewal