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You are here: Home / FAQs / What are the advantages and disadvantages of a Sole Proprietorship?
FAQ : Company Incorporation / Singapore Company Registration

What are the advantages and disadvantages of a Sole Proprietorship?

The advantages and disadvantages of a Sole Proprietorship are as follows:

Advantages:

  • Business structure is easy to set up and suitable for low-risk service providers
  • Need not audit accounts or file annual returns with the Accounting and Corporate Regulatory Authority (ACRA).
  • Profits are taxed at personal income tax rates
  • Business is easy to close/wind up

Disadvantages:

  • Owner is fully liable for his business activities and bears all risks, debts and losses
  • Face limited choices in securing funding from banks, might have to put up personal assets as collateral
  • Cannot sell a stake of the business to investors in order to raise funds

To learn more about a Sole Proprietorship, including its features, set up requirements, procedure and timeline, please refer to our Guide on Singapore Sole Proprietorship.



Related questions?

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  3. What are the documents required to open a Singapore bank account?
  4. Do I need to display my company registration number?
InCorp GroupPrimeGlobal

Rikvin Pte Ltd

EA License No. 11C3030

36 Robinson Road,
#20-01 City House,
Singapore 068877

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