In Singapore the public companies are subjected to a greater amount of rules that happen to be tougher as well. The regulations governing them are tougher as well. The main reason for that is the fact that these companies are able to generate money from the common people. Over here in this Southeast Asian country you can set up sole proprietorships as well. In this kind of a company your business will be owned by just one person.
Features of a sole proprietorship
In these companies the owners own all the assets of the business as well as its liabilities. As far as business entities are concerned it is the simplest form of business. These companies also need very little money to start – thus making them the best possible in that regard. From the point of view of convenience as well they are the best. It is also the easiest to terminate these companies. In these companies, you are in absolute control of each and every business affair in the company. This includes the decision that you take as well as the money that you earn from the business. You do not need to share the profits with anyone else. You could share the services of a Singapore company secretary in order to make sure that things go smoothly.
Benefits of a sole proprietorship
With a sole proprietorship you will never have any obligation to fulfill returns each and every year. You can also renew your membership each and every year in Singapore. However, this form of business is pretty disadvantageous as well. In fact, disadvantages of these companies are far more than the advantages. These companies are not separate incorporate entity like the private limited companies. This means that you and your business are not separate legal entities. When you become a sole proprietorship your business and yourself are the same – for the purposes of paying income tax.
Problems of a sole proprietorship
When you own a sole proprietorship you have what can basically be called unlimited liability. This means that if your business is unable to pay off your debts then you would have to do that, even if you do not want to or wish to. The creditors will come to you. Then, you will have to sell off your personal property in order to pay off the debts. A lot of people who set up such companies in Singapore do not know this. There is always a massive amount of financial risk that you are taking by opening such a company, especially if it fails.
No tax benefits
Yet another major disadvantage of a sole proprietorship is that you do not get any of the tax benefits that are available to the other kinds of businesses over here. There are no corporate tax benefits to be had and there are no tax incentives as well. There are no personal income taxes as well. Your capital is restricted to business profits as well as personal finances. More than that, the chances to expand business are also much less compared to other forms of business. The public perception regarding these businesses is quite low as well. https://www.soas.com.sg/incorporation/