Most experts believe that private limited company is the most popular business entity in Singapore due to its countless of benefits including tax exemptions, and limited liability which protects the personal assets of shareholders and directors from financial losses, liabilities, and debts of their business.
This business structure, which is more commonly called as corporation in the US and some European countries, frequently uses suffixes such as "Ltd" and "Pte Ltd" as parts of its business name.
Because of the benefits provided by a private limited company, even foreign companies and businessmen in Singapore prefer this type of structure. However, it is important to remember that the country does not allow any foreign individuals and companies to self-register their own business which is why it is a legal requirement to hire a professional registration firm that will apply on their behalf.
As a separate legal entity, a private limited company is treated like a real person, meaning, it can be sued and own a property under its name.
One of the most notable features of this business structure is its perpetual existence regardless if there is a change in management and shareholders. Also, ownership can be passed down from one person to another through selling and trading of shares.
In Singapore, newly incorporated companies are eligible for local tax exemptions, even if 100 percent owned by a foreign company or individual, as long as their management will be exercised in the country and at least one individual shareholder has a minimum of 10 percent ownership.
(Note: In case that a newly incorporated company did not meet the stated requirements above, it may still be eligible for a partial tax exemption.)
These are the tax breaks for newly incorporated companies: 100 percent tax exemptions on the first S$100,000 chargeable income and another 50 percent tax break on the succeeding S$200,000 chargeable income.
Meanwhile, a private limited company may have a minimum of one and up to a maximum of 50 shareholders who may be a local resident or foreign businessman.
For foreign companies planning to expand their business in the country, they can register a Singapore subsidiary company which is essentially a private limited company which just happens to have a foreign individual or entity as its main shareholder. It is also allowable for a foreign company to be the sole owner of its subsidiary company as long as it will appoint or relocate a director who must stay in Singapore.
Rikvin is the leading Singapore Business Registration aspecialists. It has assisted thousands of foreign entrepreneurs setup up their Marshall Islands Company operations including securing their work visas.Our office is located at Raffles Place, in the heart of the Singapore business district. ("CBD") If you're in our neighborhood and want to discuss any aspect of our service then feel free to come in to our offices during business hours. Appointments are welcome but definitely not necessary.