Comparison Chart for Singapore Residents

This guide provides a side-by-side comparison of the different types of business entities in Singapore, namely, Sole Proprietorship, Limited Liability Partnership, and Private Limited Company.
Types of Companies Structure Sole Proprietorship Limited Liability Partnership Private Limited Company
Suitable For Individual with low risk Professional firms such as accountancy, law and architecture. For businesses with projected growth, which may require additional funding for expansion.
Advantages Low cost
Business setup
Low cost setup with limited liability protection Tax exemptions
For new exempt companies only: taxed at the corporate rate; first S$100,000 of net income each year
is tax free and the next S$200.000 taxed at 8.5% for the first 3 years.
Disadvantages Personal Assets Not Protected None Compliance obligations such as Financial Reports, AGMs, etc
Ownership
  • Singapore Residents
  • Foreigners & Corporations allowed only with appointment of a local manager
  • Singapore Residents
  • Foreigners & Corporations allowed only with appointment of a local manager
  • 100% foreign or locally owned but Minimum one Singapore Resident Director required
Separate Legal Entity No Yes Yes
Cap on Number of Members One Unlimited Maximum 20 for exempt companies
Minimum Setup Requirement One owner 2 partners 1 shareholder and 1 director (the same individual can be both)
Limited Liability No Yes Yes
Accounts Audit No No Yes, for turnover above S$5 Million or non-exempt companies
Tax Treatment Taxed at personal income tax rate Taxed at personal income tax rate Dividends are tax exempt
Cessation of Business upon Death of a Member/Partner Yes Yes No. Equity shares go on in perpetuity.

Incorporation Options for Singapore Residents and their Corresponding Taxation