A limited liability company is a company limited by shares and each shareholder’s liability is restricted to their shares.
A Singapore limited liability company can be in the following form: –
The shareholders of a private limited company can either be individuals or corporate entities or both.
Most of the private businesses in Singapore are incorporated as private limited companies. This is a legal entity separate and distinct from its shareholders and directors. A Singapore Company can own property in the Company’s name. The members of a company are not personally liable for the debts and losses of the
The Company, as a separate legal entity, does not cease to exist if one or more of its shareholders pass away. Its corporate existence lasts as long as its shareholders decide it should.
A general partnership can be formed with at least two partners up to a maximum of 20 partners. The partners have unlimited personal liability and are personally responsible for paying off the debts and liabilities of the business. The partners are held responsible for the actions of another partner. A general partnership is not a legal entity.
A limited liability partnership (LLP) is a partnership where the individual partner’s own liability is generally limited.
It is owned by at least two partners and there is no maximum limit and the partners can be individuals or body corporate (company or other LLP).
An LLP is a separate legal entity from its partners and partners have limited liability. It can own property in its own name. These features allow it to enjoy the benefits of a company although it operates in the form of a partnership.
The partners of an LLP are not personally liable for debts and loses of the LLP incurred by other partners. However, the partners are personally responsible for debts and losses resulting from their own wrongful actions.
A limited partnership (LP) is a partnership consisting of two or more persons, with at least one general partner and one limited partner and there is no maximum limit for number of partners. An LP is not a separate legal entity.
The general partner has unlimited liability and is personally liable for debts and losses of the LP. The limited partner has limited liability and is not personally liable for the debts or obligations of the LP beyond amount of his agreed contribution.
A foreign company can set up a branch in Singapore to carry on business in Singapore. A branch is considered an extension of the foreign company and is not a separate legal entity.
A Singapore branch is required to file its audited accounts for the Singapore operations with ACRA and its Tax Returns with IRAS on an annual basis.
A representative office (RO) is usually set up when a foreign company wishes to establish a business presence in Singapore but does not intend to carry on business operations in Singapore. A RO has no legal status and is not a business entity and hence not allowed to perform any activity with the purpose of generating profits. A RO is only permitted to conduct market research, feasibility studies, supervise the activities of its main head quarters’ local agents and distributors. It can also act as a liaison office and provide customer support.
A sole-proprietorship is not a separate legal entity and therefore the owner and business are the same. The owner has unlimited liability and is personally liable for the debts and losses of the business.
A sole-proprietorship can own property if individual has legal capacity.
A trust is an arrangement whereby a person (trustee) holds property as its nominal owner for the benefits of one or more beneficiaries.
The trust arrangement may be held for public purposes such as charitable trusts or for private purposes such as a private family.
A private family trust is usually designed to help a high net-worth individual preserve assets and facilitate the transfer of assets to future generations.