Company incorporation in Singapore: Types of businesses and requirements

Singapore has been a global business hub for various industries, as the country offers a range of benefits for businesses looking to expand in Asia. Regulatory clarity, business infrastructure, and proximity to other Southeast Asian markets makes it a top destination for entrepreneurs and business owners.

Choosing the right business type is important to ensure you enjoy the full benefits of doing business here and this blog post delves into the different types of business structures you can work with in Singapore.

1. Sole Proprietorship

A sole proprietorship business is probably the simplest structure to set up in Singapore. This business type is owned by a single individual and ideal for small-scale enterprises and freelancers who want to start their venture with minimal capital investment.

Key things to note about sole proprietorships:

  • Full control and ownership
  • Easy and cost-effective to set up
  • No separate legal entity from the owner
  • Unlimited liability

2. Partnership

Partnerships are when two or more individuals or entities are involved with similar features to that of a sole proprietorship.

There are three types of partnerships that you can consider in Singapore:

a. General Partnership

This is where all partners share equal responsibility and liability for the business operations and debts.

Key things to note about general partnerships:

  • Shared management and decision-making
  • Combined resources and expertise
  • Unlimited liability for all partners

b. Limited Partnership (LP)

This structure includes a mix of general and limited partners. General partners manage the business and have unlimited liability, while limited partners contribute capital and have liability limited to their investment.

Key Features:

  • Flexibility in partnership roles
  • Limited liability for passive investors
  • General partners have unlimited liability

c. Limited Liability Partnership (LLP)

This structure combines the features of a partnership and a company. Partners have limited liability and the partnership is considered a separate legal entity.

Key Features:

  • Limited liability for partners
  • Separate legal entity
  • Flexibility in management structure

3. Private Limited Company (Pte Ltd)

A private limited company is one of the most popular business types in Singapore, where there is a separate legal entity from its shareholders and offers limited liability protection. This structure is suitable for businesses that aim for growth and scalability.

Key Features:

  • Separate legal entity
  • Limited liability for shareholders
  • Ability to raise capital through shares
  • Compliance with more stringent regulatory requirements

4. Public Limited Company

Public limited companies are larger entities that can raise capital from the public by issuing shares. These companies are typically listed on the stock exchange and are subject to strict regulatory requirements.

Key Features:

  • Ability to raise significant capital from the public
  • Strict regulatory and reporting requirements
  • Separate legal entity
  • Limited liability for shareholders

5. Branch Office

A branch office is an extension of a foreign parent company. It conducts business activities in Singapore but is not a separate legal entity from its parent company. This structure is suitable for foreign companies looking to establish a presence in Singapore without incorporating a local entity.

Key Features:

  • Extension of the foreign parent company
  • Not a separate legal entity
  • Liabilities extend to the parent company
  • Must comply with Singapore’s legal and regulatory requirements

6. Representative Office

A representative office is a temporary setup for foreign companies to explore business opportunities in Singapore. It cannot engage in commercial activities and is mainly used for market research and liaison purposes.

Key Features:

  • Temporary establishment
  • Cannot conduct commercial activities
  • Used for market research and liaison
  • No legal entity status

7. Subsidiary Company

A subsidiary company is a locally incorporated company with a foreign parent company as its shareholder. It is a separate legal entity from its parent company and offers limited liability protection.

Key Features:

  • Separate legal entity
  • Limited liability for shareholders
  • Can engage in full business activities
  • Subject to local regulations and taxes

Requirements to incorporate your business in Singapore

As stipulated by the Companies Act 1967, if you are looking to incorporate a business entity in Singapore, there are a few requirements that must be fulfilled, such as: 

  1. A corporate secretary – appointed within 6 months of incorporation
  2. A local company address
  3. Paid up capital
  4. A local director

Incorporate your business in Singapore with Berru.co

As your business concierge for all corporate services in Singapore, our team at Berru.co brings a range of expertise in the fields of accounting , corporate secretarial services and even growth and entrepreneurship. On top of ensuring our clients can fulfil the regulatory requirements, we are able to provide advice, network and guidance for our clients to run their business operations effectively in Singapore.

We pride ourselves as a high touch point corporate services firm and are zealous in seeing our clients grow.


Share