Life goes on! And one day, a path-breaking idea that can solve problems and pains of individuals strikes and dazzles us. It uplifts our soul. We are swamped by emotions. It makes us eager to help others. It is a moment that makes you think of a Singapore company incorporation with ACRA.

When you brainstorm the situation, you realize that you need to choose a business structure to form your business. If you are a newbie, you have to start from the basic. "Which legal or business structure is the best for me?" “Will a private limited company registration do for me?”

Right Business Structure: Why?

Choosing the right business structure is a matter of grave importance:

  • It governs the taxes you have to pay.
  • It dictates your statutory compliance.
  • It affects your business' account and finance provisions.
  • It is a factor when you want to expand your business.
  • It also decides your liability as to the business owner.
  • It also decides the accountability of individual directors.

Singapore Legal or Business Structure

In Singapore, you can register your business using one of the following structures:

  • Sole Proprietorship
  • Limited Liability Partnership (LLP)
  • Private Limited Company

Before going ahead, you need to have a firm grasp of the business structure that you are interested in—research on the internet. Alternatively, you can also discuss your needs with an experienced provider of Singapore company incorporation services like SBS Consulting.

Singapore Private Limited Company (PLC)

Business owners prefer to register a Singapore private limited company. It is dynamic and is a business structure that scales well with a growing company. It has an individual legal identity and credibility: investors, lenders, vendors to prefer to deal with.

Most importantly, a Singapore PLC limits the liability of its shareholders to their share capital. It is registered as per the Companies Act (Cap. 50)

  • It has a separate legal identity from its shareholders
  • It can sue and be sued in its name
  • The company pays corporate income tax (0%-17%)
  • It can purchase property in its name
  • Its shareholders are not accountable for its debts and liabilities
  • It has perpetual existence. It keeps on existing even after the death of its shareholders or transfer of shares

Basic Provisions of a Private Limited Company

  • At least 1 shareholder (Individual or a corporate)
  • Foreigners are allowed 100% shareholding in the PLC
  • At least 1 local director (Singapore resident)
  • A shareholder can also act as its director
  • At least 1 company secretary (Singapore resident)
  • Minimum initial paid-up capital of S$1
  • Registered physical office address
  • At least 1 auditor (If required)

Singapore Sole Proprietorship

The drawback of a sole proprietorship is that it has no separate legal identity from its proprietor. It is a business firm that depends on its proprietor for credibility.

  • The proprietor has unlimited liability
  • The proprietor is responsible for the proprietorship's debts and losses
  • The proprietorship cannot purchase properties in its name
  • Purchases properties are in the name of its proprietor who must pay property tax
  • The income of proprietorship is taken to be proprietor's income who must pay personal income tax (0%-22%) on it. The rates are costlier than the corporate tax
  • Raising funds for business expansion depends on the proprietor's credibility

Limited Liability Partnership (LLP)

An LLP combines the best of a partnership and a company and is favoured by the business owners or members. A group of 2-20 individuals/companies can register an LLP.

Usually, the members have complementing skills or services. Registering an LLP allows them to club and offer a wide range of services.

  • The LLP is a separate legal entity from its members
  • The members pay personal income tax (0%-22%) on the income received from LLP
  • The members' liability depends on their mistakes, actions or inaction leading to losses or debts to the LLP
  • The uninvolved partners are not liable for the debt or losses
  • Professionals like Charted accountants, lawyers, and architects prefer to register an LLP

Private Limited Company Registration

As you can see, opting for private limited company registration in Singapore makes sense. Doing so also gives you access to various types of tax exemption, benefits, and rebates. Many of these benefits are not available to a sole proprietorship and an LLP.

The process for forming a Singapore company has 2 steps. The process is online, and ACRA has provided an e-portal called BizFile+ for it. The steps are as follows:

  • Registering Company Name with ACRA
  • Registering Company with ACRA

Documents for Singapore Company Registration

You will also need to submit the following documents at the time of company set up:

  • Registered company name
  • A brief explanation of business activities
  • Details of Shareholders, directors, and company secretary
  • Registered local office address
  • Company Constitution (M&AA)
  • Passport and residential proofs for foreigners
  • A copy of Singapore ID for Singapore residents

You may still have doubts about which business structure to use. It will help you to have a hearty discussion with an experienced provider of Singapore company incorporation services.

You should prefer a registered filing agent like SBS Consulting for the purpose. We, as your agent, can legally interact with ACRA to pay official fees and submit documents on your behalf.

Usually, we take only 1-3 days for private limited company registration. Contact us on +65-6536 0036 or email us at for answers.

Author's Bio: 

SBS Consulting is one of the leading corporate services provider in Singapore. It specializes in Company Incorporation, Accounting, Preparation of director's report, Taxation, GST, Payroll, XBRL, and other value added business services for residents and non-residents of Singapore.