Set up company in Singapore: Types of business entities

Before Tetra Consultants set up company in Singapore, it is important to choose the most suitable business entity for our international clients’ business. Depending on your business goals and financial capability, Tetra Consultants will advise the capabilities and limitations of each type of company in Singapore.

Set up company in Singapore

Limited liability company (Pte. Ltd.)

The most common business entity used to set up company in Singapore is the limited liability company. A Singapore limited liability company is suitable for both onshore and offshore businesses. A limited liability company is a separate legal entity and as such, it is distinct from its directors and shareholders. The members have limited liabilities and you can have up to 50 shareholders. Our international clients are able to legally own properties under the company’s name. For company registration, our international clients are not required to travel to Singapore.  According to ACRA, the minimum requirements for a limited liability company are:

  • 1 shareholder
  • 1 resident director
  • 1 company secretary
  • A Singapore registered office address
  • Minimum paid up capital of $1

Limited Liability Partnership (LLP)

A Singapore limited liability partnership (LLP) is a perfect blend of a partnership and a private limited company. A limited liability partnership gives owners the flexibility of operating as a partnership while having a separate legal identity like a private limited company. This structure is highly suitable for individuals engaged in professional services such as lawyers, architects, accountants and management consultants. Singapore citizens, residents, and Employment Pass holders can register a limited liability partnership. Foreign individuals and companies may also register a limited liability partnership but must appoint a local manager. The partner in a limited liability partnership can be an individual, a local company, a foreign company or another limited liability partnership. The advantage of such a partnership is that this is a low cost company Singapore set up with limited liability protection. However, limited liability partnership is taxed at the individual level and requires paying a personal income tax rate (max 22%) that is higher than the corporate tax rate (max 17%). The minimum requirements for a limited liability partnership are:

  • 2 partners (including 1 resident in Singapore)
  • 1 company secretary
  • A Singapore registered office address
  • Minimum paid up capital of $1

Branch Office

A Branch Office in Singapore is an extension of a foreign parent company registered outside of Singapore. The purpose of a Branch Office is to facilitate operation and revenue generation in Singapore for the foreign parent company. It is considered a non-resident for tax purposes, and therefore not eligible for tax incentives and exemptions available to Singapore private limited companies. The branch office can only conduce business within the scope of the parent company and is considered a non-resident company for tax purposes. As such, this business entity is unable to enjoy double taxation avoidance treaties and tax incentives.  Additionally, any liabilities incurred by the branch are attributed to the parent company. The minimum requirements for a branch are:

  • 1 Corporate Shareholder
  • 1 Singapore Resident Agent
  • A Registered Office Address in Singapore

Representative Office

A Representative Office provides a foreign company interested in establishing operations in Singapore an avenue to assess business opportunities in the Singapore market. It is also ideal for a foreign company that is interested in promoting its brand and to work with its local agents and distributors. It is a short-term set up (for up to three years), and it is not permitted to engage in commercial revenue-generating activities such as concluding contracts and opening of Letter of Credit. This business entity is only allowed to conduct market research, feasibility studies, supervise the activities of its main headquarters’ local agents and distributors, act as a liaison office during a negotiation deal and provide customer support. A representative office must fulfill the following criteria:

  • Sales Turnover of the foreign entity must be > US$250,000
  • Number of years of establishment of the foreign entity must be >= 3 years
  • Proposed number of staff should be < 5 people
  • One resident representative
  • A Registered Office Address in Singapore

Contact us to find out more about how to set up business in Singapore. Our team of experts will revert within the next 24 hours.

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