Sole Proprietorship Business Registration

Features of a Sole Proprietorship

• It does not have a separate legal entity
• The owner has unlimited liability
• It cannot own property

Advantages of being a Sole Proprietor

• Quick, easy and least expensive to set up.
• Easy to administer and manage because of undivided authority and control.
• Less administrative duties, on going compliance requirements.
• All the profits generated by the business will be taxed at personal income tax level.
• Easy to close.

Disadvantages of being a Sole Proprietor

• The owner’s assets are at risk since owner is responsible for all debts and losses.
• Earnings are charged at personal income tax rates and is deprived of incentives offered to companies.
• Lack of continuity; the business is identified with the owner therefore not perpetual and it ceases with the death of owner and is not transferable by part.
• Raising capital through loans from institutions or investors is difficult due to inferior image and dependency on sole owner.
• Must renew business registration annually and top up CPF account.
• Sole proprietors do not enjoy tax exemptions and rebates available to corporations.

Summary of Setup Requirements for a Sole Proprietorship

• Minimum one owner
• A Singapore registered office address
• For foreign individuals and companies only: minimum one manager who must be a Singapore resident

Taxation of Singapore Sole Proprietorship

Singapore Sole Proprietorship, though a tax resident, is not considered as a company entity; therefore its profit is taxed at personal income rate.

Notes

If you are a Singapore resident and you want to set up a Sole Proprietorship, you will need to do the following:

• Visit our office with your identification papers. Sole Proprietorship business registration can be done within 10 minutes.