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The different type of Singapore Company incorporation and .pdf


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Once you are convinced that you want to register company in
Singapore, it is important that you know the type of company or
business entity that you want to incorporate, such as Sole
Proprietorship, Partnership, Limited Liability Partnership, or
Limited Partnership.
As a home to so many international companies operating in a
wide spectrum of industries, the legal framework of Singapore
allows for a variety of business structures to get registered and do
sustainable and profitable business while ensuring that their
diverse needs and requirements are met.

The decision about the type of company you need to
incorporate is critical as the type of entity you choose
will ultimately determine the key issues such as the
liability of owners, transfer ability of business, financing
and expansion potential of the business and most
importantly the tax and compliance cost of maintaining
the entity.
Here are all the important details about types of
companies in Singapore so that you can choose the best
option that’s applicable in your specific situation.

A Company is a company limited by shares i.e. its liabilities are
limited to the amount of share capital. A company is incorporated by
registering
with
Accounting
and
Corporate
Regulatory
Authority (ACRA) of Singapore under the Companies Act. It is a
separate legal entity, meaning there is a legal veil that separates
owners from the entity. A company can enter into contracts and own
assets. It can sue and be sued in its own name.
The liability of the company is limited to its share capital and each
member’s liability is limited to the share capital subscribed by the
member (shareholder).
The liabilities of the owners are limited to the assets in the company
and their personal assets are protected from business liabilities.

Private limited company incorporation in Singapore is the choice of
many small and medium size business entities due to several benefits
that it offers.
The shareholders are not held responsible for company debt that
surpasses share capital contributed.
The company’s shares belong to limited people, usually, a few
individuals or corporate entities and are not available to the public at
large.
Shares can easily be transferred
it has easier means to raise capital

In addition to above advantages, there are tax exemptions
provided to small and medium size businesses, most of
which choose private limited as their choice of company
incorporation in Singapore.
Under the Tax Exemption Scheme for New Start-Up
Companies, qualified companies are given full exemption
on the first $100,000 normal chargeable income* and a
further 50% exemption on the next $200,000 of normal
chargeable income for the first three consecutive years.

Different from a private limited company, the shares
of a public limited company are often available to the
general public. These companies will be found in the
stock exchange. The number of shareholders is at a
minimum of least 50 people. Given that these types of
companies involve the public at large, there are more
rules and regulations that avoid exploitation and the
misuse of public funds. This option is best for large
businesses.

Unlike private and public limited companies, this type of
company is mainly setup for a non-profitable purpose. It
is conceptually a public company formed along the
principle of limiting the liability to the amount that
members contribute to the assets of the company.

This set up is common with non-profit organisations.

Types of company structures available for business owners to register
company in Singapore

This is the simplest type of company and it’s easiest to
incorporate company in Singapore as Sole Proprietorship.
It is however, the riskiest considering that likes of LLC, the
owner of a Sole Proprietorship company is seen as part and
parcel of the company. They are thus, more liable to suffer risks
that arise from the business.
Personal assets and those of the company are under the owner’s
name, meaning they are not protected. If the company is in
debt, then personal assets are legally not beyond the reach of
creditors.
This type of company is best suited for individual shop owners
or solo entrepreneurs. It’s important that the risks involved in
operating such a company are clearly understood before going
for registration.


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