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 |
|
|
|
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. |
