In 2020, Singapore has been named as the most open-market economy in the world. This means that Singapore has the most relaxed policies and regulations when it comes to business transactions. This makes it more attractive to more investors and new companies. Singapore may have the most relaxed policies, however, these policies are strictly implemented. The strict implementation of these policies makes sure that Singapore has an organized economy. When you want to set up company in Singapore, there are various steps that you have to go through. One of the first steps is when you incorporate company in Singapore.
Why do you need to choose the right company structure?
When you incorporate company in Singapore there are many things that you must remember. One thing that you have to remember when you want to incorporate company in Singapore is to choose the right company structure. Choosing the right company structure is vital to the success and the further steps of the company. That is why one has to choose a company structure before they can set up company in Singapore.
Choosing the right company structure will let you determine the next steps to make a fair business. A company structure affects personal liability, the volume of the share capital, and other financial matters. This is why it is important to choose the right company structure before you incorporate company in Singapore. To know more, let us talk about the different types of company structures and their pros and cons.
Pros and Cons of different company structures
Sole Proprietorship
Most people who set up company in Singapore start with a sole proprietorship. This business structure is known as the simplest form of business that you can incorporate. This also requires a minimal number of paperwork and documents to be filed. When you are a sole trader you are basically considered self-employed and working for yourself.
When you incorporate company in Singapore as a sole proprietorship the business will solely be controlled by you. That is why there will be fewer regulations and filing of required documents. Having a sole proprietorship structure of business means that the decisions are all based on you. This way you can have more control and more direction depending on what you like for the business.
However, a sole proprietorship kind of business can be too risky because when all else fails you will be the only one who will be affected. This is why when you want to set up company in Singapore you have to make sure that you’re financially able and financially ready to take the risk.
Partnership
The partnership involves two or more individuals when you incorporate company in Singapore. When you set up a company in Singapore with a partnership business structure you will have to choose a company name and nominate a partner and register with the HMRC. This structure also gives the same advantages as a sole proprietorship, however, you will have someone to control the business with you. Having a partner may have its pros but this also means that you will have to split profit and the liability. Before you setting up a company in Singapore you have to be careful in choosing your business partner
Limited liability partnership
This structure does not limit the number of individuals involved. However, it requires at least two designated members accountable for filing annual accounts. The company structure is usually driven by profit and has shareholders. One of the advantages of this is that you are only liable for the amount of money that you invested in. That is why if you are planning something big this may be the right choice for you before you set up a company in Singapore.
Limited Company (Ltd)
The last option before you incorporate company in Singapore is a limited company structure. This structure means that the businesses are owned by shareholders and run by the directors. Before you can set up company in Singapore under this structure you have to file for a company name and a registered office address. There should also be one director and one secretary.
Need help to incorporate a company in Singapore?
The company structure is only one of the things that you have to do before you can incorporate company in Singapore. That is why hiring help or a third-party team is more advisable so that you can easily set up company in Singapore. WLP Group is a trusted and reliable form that can help you. Visit us today to know more about our incorporation services.
