Singapore, being home to over 400,000 businesses, allows for a wide range of business structures to accommodate the different needs of its business owners. Selecting the appropriate entity type is vital since this can determine your liability, expansion potential, tax, compliance cost and other key issues critical for the business.

Sole Proprietorship

A sole proprietorship is an option for individuals who want to start their own business with no other partners. A sole proprietorship is a business that is owned and controlled by a single person, company, or limited liability partnership.

Key features include:

  • It is not a separate legal entity from the business owner.
  • The business owner has unlimited liability (i.e. the business owner is personally liable for all the debts and losses of the sole proprietorship).
  • It can sue or be sued in the owner’s name.
  • All profits are taxed in the owner’s hands.


Partnership can be either in the form of a general partnership, a limited partnership, or a limited liability partnership.

General Partnership

A partnership can be formed by two or more people who want to start a business operation with the intention of making a profit.

Key features:

  • Partnership requires between 2 to 20 individuals to form.
  • It is not a separate legal entity and hence partners have unlimited liability.
  • Each partner will be held liable for the debts and losses incurred by the other partner.
  • It can sue or be sued in the partners’ names
  • Profits are taxed at the partners’ hands.
  • A partnership will continue to exist subject to the partnership agreement.

Limited Partnership:

A limited partnership (“LP”) has at least two partners, with at least one general partner and one limited partner. The general partner is in charge of the LP’s actions and is accountable for all the partnership debts. A limited partner, on the other hand, is not responsible for the LP’s debts.

Key features:

  • Requires minimum 2 partners, with no limit placed on maximum members.
  • It is not a separate legal entity, with the general partner being liable for debts of the LP. The limited partner is not liable for debts or obligations that go beyond his initial agreed contribution.
  • Profits are to be taxed at the partners’ personal income tax rate (if individual) or corporate tax rate (if corporation).
  • An LP will continue to exist subject to the partnership agreement.

Limited Liability Partnership:

A Limited Liability Partnership (“LLP”) is a partnership that allows its partners with the flexibility in operation by acting as a separate legal entity similar to a private limited company. Each partner’s personal liability is limited. Partners in an LLP can only be held accountable for losses resulting from their own wrongful act or omission and cannot be held accountable for the wrongful act or omission of the other partners in the LLP.

Key features:

  • Requires minimum 2 members, with no limit on maximum number of members.
  • It is a separate legal entity, with partners having limited liability.
  • Profits are to be taxed at the partners’ personal income tax rate (if individual) or corporate tax rate (if corporation).
  • An LLP will continue to exist under the premise of perpetual succession unless it proceeds to be wound up or struck off.


A company is a form of business with a separate legal entity from its shareholders and directors. Companies are mainly classified into Private and Public.

Key features:

  • It is a separate legal entity from its members and directors.
  • Shareholders of a company have limited liability and cannot be held personally liable for the debts or losses of the company.
  • Profits of a company are taxed at corporate tax rates.
  • It has legal perpetuity wherein the death or insolvency of the shareholders will not affect the existence of the company.
  • Needs to have at least one Singapore resident director

Private Limited Company

Private Limited Companies are the most common type of entity in Singapore. It has a maximum of 50 shareholders, and the shares are privately held by each of them. Public trading of these shares is not permitted.


Public Company

There are two types of public companies.

  • Public Company Limited by Shares – A public company is an entity with more than 50 shareholders. A public company is required to file a prospectus to the Monetary Authority of Singapore before offering its shares to the public. Companies listed on any exchange will be subject to stricter compliance obligations imposed by the exchange.
  • Public Company Limited by Guarantee – Public companies limited by guarantee are mainly set up by charity, religious bodies, trade association and other non-profit activities. These entities are established for the benefit of the public and has no share capital. The liability is restricted to the amount that its members have committed to contribute to the company’s assets.

Our company is equipped with some of the most experienced and well-equipped accountants and CAs. It means you have access to accurate accounting procedures and reports.


What Our Clients Saying ?