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1. Why Singapore?
Singapore is an ideal location for global businesses to site your office or regional headquarters. Clear laws and regulations means Singapore company enjoy a prestige and branded presence for your business. Setting up a business in Singapore, your company will benefit from:
Singapore’s network of over 50 comprehensive Double Taxation Avoidance Agreements.
One of the lowest company tax in the world.
Clear law and regulations means no surprises for business owners and corporate planning.
One of the world most politically stable country
No dividend and capital gain tax
No auditing for company that qualify as a small company
Ease of doing business. Authority approval and permits are processed timely
2. Which business structure should I choose?
There are few different types of structures you can choose from when starting a business. Which one you settle on depends on a number of factors, and you should choose the structure that best meets your needs.
The following questions will be helpful in your consideration:
How much capital are you prepared to invest?
How many owners will there be in the business?
What liabilities and responsibilities are you prepared to assume?
What risks are you prepared to take?
Will a company of that particular structure be easy to close?
3. Types of Business Structures
A business owned by a single person or company. The sole-proprietor has absolute say in the running of the business.
Not more than 20 partners. Once there are more than 20 partners, the partnership must be registered as a company under the Companies Act, Chapter 50. It will then have its own legal personality i.e. rights to own properties, has perpetual succession and can sue or be sued in its own name. It usually has the words 'Pte Ltd' or 'Ltd' as part of its name.
Limited Liability Partnership (LLP)
Gives owners the flexibility of operating as a partnership while having a separate legal identity like a private limited company.
The partners of the LLP will not be held personally liable for any business debts incurred by the LLP. A partner may, however, be held personally liable for claims from losses resulting from his own wrongful act or omission, but will not be held personally liable for such wrongful acts or omissions of any other partner of the LLP.
Limited Partnership (LP)
Consists of a minimum of two partners, with at least one general partner and at least one limited partner. An LP does not have a separate legal entity from the partners.
Private limited company
A private limited company is the most common type of business structure in Singapore. A private limited company is limited by shares and has a separate legal entity from its shareholders. It is recognised as a taxable entity in its own right. As such, its shareholders (ie. owners) of the Singapore private limited company are not liable for its debts and losses beyond their amount of share capital.
A branch office is a proper legal entity after registration where a branch is usually an extension of its parent company. A branch office has to employ a minimum of one ordinarily resident in Singapore. However, a branch office is not a separate entity from its parent company (unlike a subsidiary company) where the parent company is liable for all its debts and liabilities.
As the name implies, a representative office is setup only for the purpose of market research and feasibility studies, and no profit-making business activities are allowed.
Furthermore, a representative office does not have a separate legal identity from its foreign parent company and it has to employ not more than five employees.