Choose the type of company you want to incorporate
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A Private Limited Company (limited by shares) belongs to legal business entities. It is separate from its shareholders and directors. Regardless, the company registration process is easy.
Pros
- Shareholders of a Private Limited Company are not liable for any company debt beyond their share capital
- The corporate income tax is between 0% and 17%
- Newly established Singapore-registered companies can qualify for a few tax exemptions
- Shareholding can be either local or foreign
- The company can own property in its name
Cons
- The Singapore Companies Act allows a maximum of 50 shareholders for every Private Limited Company
- Shares are not made available to the public
The process of setting up a Branch Office is similar to a Subsidiary Company, however it is considered an extension of the parent company, rather than a separate legal entity.
Pros
- 100% foreign ownership allowed
- Ability to enter contracts on behalf of the parent or holding company
- Leverage of the foreign company's name to drive the business forward
Cons
- The parent company is liable for any losses
- The Branch Office is restricted to the same constitution as the parent company
- A parent company is required before setting up a Branch Office
A Sole Proprietorship has one owner who is personally responsible for any profit and losses. The business and its director are considered as a single entity.
Pros
- All profits belong to the owner
- Revenue is taxed at personal income tax rate so annual return filing does not apply
- Less government compliance obligations compared to other business types
Cons
- The owner is responsible for any losses or debt, putting your personal assets at risk
- A Sole Proprietorship is not entitled to the same tax exemptions and rebates as corporations
This type of business can be owned by a minimum of two individual(s) and a company. The owners of a Partnership have limited liability much like the shareholders of a Private Limited Company.
Pros
- As this is a separate legal entity, partners are not liable for any company debt beyond their share capital
- Partnerships file income tax statements instead of annual returns
- Less government compliance obligations compared to a Private Limited Company
Cons
- Transfer of ownership is more complicated than doing this with a Private Limited Company
- Less consumer-focused image than other types of businesses