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Before a business begins selling goods and services in <\/span>Singapore<\/b>, it must first go through the process to legally register itself with the country, one of the most common of which is <\/span>company incorporation<\/b><\/a>. The first step to<\/span> registering a business or company incorporation<\/b> is <\/span>choosing the right business structure<\/b>. There are several <\/span>types<\/b> of <\/span>business entities<\/b> available, each differing<\/span> in various aspects including<\/span>:<\/span><\/p>\n Described below are selected key features and differences between the various types of business structures.<\/span><\/b><\/p>\n Registration of a sole-proprietorship is not the formation of a new business entity but is in effect a business name registration of the trader (sole-proprietor). It is not a separate entity apart from the owner. A sole-proprietorship does not have limited liability and the personal assets of the owner will be accessible to meet the liabilities of the business.<\/span><\/p>\n Compared to other forms of business entities, the registration and compliance requirements for a sole-proprietorship are relatively simple. The profits of the business are attributable to the owner<\/span>,<\/span> who will be taxed <\/span>on the s<\/span>ole-proprietorship<\/span>\u2019s profits as <\/span>personal income.<\/span><\/p>\n A business is required to maintain and retain sufficient accounting records and documents to enable its income and expenditure to be readily ascertained and verified.<\/span><\/b><\/p>\n Registration of a partnership is also effectively the registration of<\/span> a firm\u2019s b<\/span>usiness name <\/span>and the particulars of its partners (an individual or a corporation). <\/span>A partnership is not a separate legal entity apart from the partners<\/span>, and i<\/span>ts partners do not have limited liability.\u00a0<\/span><\/p>\n The requirements for registration of a partnership are also relatively simple especially if the partners are all individuals in Singapore. A partnership does not have any constitution to regulate the affairs of the partnership. While there are laws that apply to <\/span>them<\/span>, there may be <\/span>an<\/span> agreement to govern the relationship among the partners. <\/span>This<\/span> agreement should also be drawn up if the profit-sharing ratio is not equal among the partners.<\/span><\/p>\n The profits of the business are allocated to the partners who will be taxed on the profits as their personal income. Even though the entity itself is not subject to tax, a partnership will have <\/span>to submit <\/span>an income tax return with details including the allocation of the divisible income among the partners.<\/span><\/p>\n A partnership is also required to maintain and retain sufficient accounting records and documents to enable its income and expenditure to be readily ascertained and verified.<\/span><\/p>\n Companies are legal entitie<\/span>s s<\/span>eparate from <\/span>the<\/span> members (<\/span>a minimum of one individual or corporate shareholder)<\/span> and Directors of the companies<\/span> that can be 100% owned by foreigners. They possess the capacity to<\/span> own property, and pursue legal actions under their own name like any other person. <\/span>To operate in Singapore, companies must have a registered office address and appoint at least one Director residing in Singapore. A shareholder (member) may also serve as a Director of a company. There is no authorised capital for Singapore companies, and shares in Singapore companies do not have any par value.<\/span><\/p>\n Companies may be<\/span> classified as public or private, <\/span>and their liabilities may be limited or unlimited with respect to <\/span>their<\/span> members. Under normal business circumstances, the personal assets of <\/span>a limited liability company\u2019s members <\/span>are protected from claims against the companies.<\/span><\/p>\n Public companies<\/b> with limited liability may be <\/span>limited by shares<\/b> or by guarantee,<\/span> the latter being common f<\/span>or charitable and <\/span>nonprofit<\/span> entities.<\/span><\/p>\n Companies are governed by the Companies Act 1967 and related subsidiary legislation, common law and their own Constitution. The relationships between shareholders may also be bound by any shareholders\u2019 agreements that may <\/span>be<\/span> in place.<\/span><\/p>\n A company is required to prepare financial statements that comply with the requirements of the Financial Reporting Standards and give a true and fair view of the financial position and performance of the company. The financial statements must be audited by a registered public accountant or accounting entity unless the company (excluding public companies) qualifies for exemption from audit requirements.<\/span><\/p>\n Learn More: <\/span><\/i>Audit Exemption for Private Companies<\/span><\/i><\/a><\/p>\n\n
1. Sole-proprietorship<\/h2>\n
2. Partnership (General Partnership)<\/h2>\n
3. Company<\/h2>\n