Question 1

Singapore Company vs Sole Proprietorship?

Achibiz · Accepted Answer

Comparison of Singapore Company vs Sole Proprietorship

Click here to view the comparison of Singapore Entities & Firms (In PDF).

Click here to view the Advantages & Disadvantages / Pros & Cons of all types of Entities & Firms in Singapore. (In PDF)

Features	Company	Sole-Proprietorship
Introduction	One of the most preferred corporate vehicle for wider range of business journey	A basic & simple form of starting the business vehicle
Suitability of Business Vehicle	Suitable for carrying all types of business activities including professional services	Suitable for a small scale business with low risks
Definition	A business form which is a legal entity separate and distinct from its shareholders and directors	A business owned by one person
Ownership or Owners	Exempt Private Company – 20 members or less and no corporation holds beneficial interest in the company’s shares Private Company – 50 members or less Public Company – can have more than 50 members	Only one person
Legal Identity or Status	A separate legal entity from its members and directors Members have limited liability Can sue or be sued in company’s name Can own property in company’s name Members not personally liable for debts and losses of company	Not a separate legal entity Owner has unlimited liability Can sue or be sued in individual’s own name Can also be sued in business name Can own property in individual’s name Owner personally liable for debts and losses of business
Requirements For Registration or Formation or Incorporation	Minimum of one share. Minimum Paid-up capital is S$1 (SGD One Only) At least one shareholder. At least one director ordinarily resident in Singapore, at least 18 years old. If a foreigner wishes to act as a local director of the company, he can apply for an EntrePass from the Ministry of Manpower (MOM). Undischarged bankrupts cannot be a director and cannot manage a company without approval from the Court or the Official Assignee.	Age 18 years or above. Singapore citizen / Singapore Permanent Resident / EntrePass holder. If owner not resident in Singapore, he must appoint an authorized representative who is ordinarily resident in Singapore. Self-employed persons must top up their Medisave account with the CPF Board before they register a new business name, become a registrant of an existing business name, or renew their business name registration. Undischarged bankrupts cannot manage the business without approval from the Court or the Official Assignee.
Easiness of Registration	An easy process to be completed within a few hours however subject to referral to different authorities which may delay up to 14 working days	An easy process to be completed within a few hours however subject to referral to different authorities which may delay up to 14 working days
Level of Fees for Registration	High when comparing to other form of business vehicles	Low set up costs among all business vehicles
Renewal Costs	Perpetual succession hence renewal is not applicable	Low costs for renewal
Perception of Business by the Public	Regarded more trust worthy and credibility	Regarded least trust worthy and credibility
Funding Opportunities	Avenue for equities from members including venture capital funding. Obtaining financial loans is relatively easier compared to other form of businesses.	Obtaining loans from banks is only by mortgaging the personal assets.
Yearly Statutory Obligations	Must appoint a company secretary within 6 months of incorporation. Must appoint an auditor within 3 months after incorporation, unless the company is exempt from audit requirements Annual returns must be filed. Statutory requirements for general meetings, directors, company secretary, share allotments must be complied with.	Yearly renewals (one year or three years) CPF Medisave Top-Up required for Self-employed Persons before they can renew sole-proprietorship
Taxation	Profits taxed at corporate tax rates	Profits taxed at owner’ personal income tax rates
Taxation Form	ECI & Form C or C-S	Form B
GST Implication	GST obligation is at entity level based on own turnover	Based on combined turnover of all of your sole proprietorship firms plus income derived from other trades, professional services or vocation
Perpetual Existence in Law	A company has perpetual succession until wound up or struck off.	Existence subject to life of the owner and cessation of the business
Transfer of Ownership	Ownership can be transferred by sale and purchase of shares	When the owner exits the sole proprietorship will cease
Closing the Business or Deregistration	Winding Up – Voluntarily by members or creditors, compulsorily by the High Court Striking off	By Owner - Cessation of business Registrar can cancel registration if not renewed or where Registrar is satisfied business is defunct

Question 2

Singapore Company vs Sole Proprietorship?

Achibiz · Accepted Answer

Comparison of Singapore Company vs Sole Proprietorship

Click here to view the comparison of Singapore Entities & Firms (In PDF).

Click here to view the Advantages & Disadvantages / Pros & Cons of all types of Entities & Firms in Singapore. (In PDF)

Features	Company	Sole-Proprietorship
Introduction	One of the most preferred corporate vehicle for wider range of business journey	A basic & simple form of starting the business vehicle
Suitability of Business Vehicle	Suitable for carrying all types of business activities including professional services	Suitable for a small scale business with low risks
Definition	A business form which is a legal entity separate and distinct from its shareholders and directors	A business owned by one person
Ownership or Owners	Exempt Private Company – 20 members or less and no corporation holds beneficial interest in the company’s shares Private Company – 50 members or less Public Company – can have more than 50 members	Only one person
Legal Identity or Status	A separate legal entity from its members and directors Members have limited liability Can sue or be sued in company’s name Can own property in company’s name Members not personally liable for debts and losses of company	Not a separate legal entity Owner has unlimited liability Can sue or be sued in individual’s own name Can also be sued in business name Can own property in individual’s name Owner personally liable for debts and losses of business
Requirements For Registration or Formation or Incorporation	Minimum of one share. Minimum Paid-up capital is S$1 (SGD One Only) At least one shareholder. At least one director ordinarily resident in Singapore, at least 18 years old. If a foreigner wishes to act as a local director of the company, he can apply for an EntrePass from the Ministry of Manpower (MOM). Undischarged bankrupts cannot be a director and cannot manage a company without approval from the Court or the Official Assignee.	Age 18 years or above. Singapore citizen / Singapore Permanent Resident / EntrePass holder. If owner not resident in Singapore, he must appoint an authorized representative who is ordinarily resident in Singapore. Self-employed persons must top up their Medisave account with the CPF Board before they register a new business name, become a registrant of an existing business name, or renew their business name registration. Undischarged bankrupts cannot manage the business without approval from the Court or the Official Assignee.
Easiness of Registration	An easy process to be completed within a few hours however subject to referral to different authorities which may delay up to 14 working days	An easy process to be completed within a few hours however subject to referral to different authorities which may delay up to 14 working days
Level of Fees for Registration	High when comparing to other form of business vehicles	Low set up costs among all business vehicles
Renewal Costs	Perpetual succession hence renewal is not applicable	Low costs for renewal
Perception of Business by the Public	Regarded more trust worthy and credibility	Regarded least trust worthy and credibility
Funding Opportunities	Avenue for equities from members including venture capital funding. Obtaining financial loans is relatively easier compared to other form of businesses.	Obtaining loans from banks is only by mortgaging the personal assets.
Yearly Statutory Obligations	Must appoint a company secretary within 6 months of incorporation. Must appoint an auditor within 3 months after incorporation, unless the company is exempt from audit requirements Annual returns must be filed. Statutory requirements for general meetings, directors, company secretary, share allotments must be complied with.	Yearly renewals (one year or three years) CPF Medisave Top-Up required for Self-employed Persons before they can renew sole-proprietorship
Taxation	Profits taxed at corporate tax rates	Profits taxed at owner’ personal income tax rates
Taxation Form	ECI & Form C or C-S	Form B
GST Implication	GST obligation is at entity level based on own turnover	Based on combined turnover of all of your sole proprietorship firms plus income derived from other trades, professional services or vocation
Perpetual Existence in Law	A company has perpetual succession until wound up or struck off.	Existence subject to life of the owner and cessation of the business
Transfer of Ownership	Ownership can be transferred by sale and purchase of shares	When the owner exits the sole proprietorship will cease
Closing the Business or Deregistration	Winding Up – Voluntarily by members or creditors, compulsorily by the High Court Striking off	By Owner - Cessation of business Registrar can cancel registration if not renewed or where Registrar is satisfied business is defunct