A Partnership in Singapore, similar to Sole-Proprietor the simplest form of business entity which is owned by at least two to a maximum of 20 partners who have shared authority and responsibility for all assets and liabilities belonging to the business. There is no legal difference between the partners and the business entity, for example, the partners are personally responsible for the debts incurred in the mean of operating the business. It also cannot own a property in its name.
Registration of a Partnership can be done easily for Singaporean or Singapore Permanent Resident; however for foreigners and overseas companies, they can only register a Partnership with the appointment of a local resident manager or if one of the partners are Singaporean or Singapore Permanent Resident.
Who can Register a Partnership in Singapore?
- Individuals; a Singapore Citizen, Singapore Permanent Resident, or an Entrepass Holder who is at least 18 years of age
- Corporate; a Singapore registered company
- Foreigners / Foreign Entities
- A local manager who is either a Singapore Citizen or Permanent Resident and is at least 21 years of age
- A registered filing agent for submission of application
- OR a Partner who is a Singaporean or Singapore Permanent Resident
What to Prepare Before Registration
- Business Name:
In Singapore, prior to registration, the business name has to be approved by ACRA (Accounting and Corporate Regulatory Authority) before the Sole-Proprietorship can be registered. The requirements of the name are that:
- It is not identical or similar to another existing Business Entity’s Name
- It must not be vulgar, obscene or offensive
- It must not be banned by order of the Minister for Finance
Should the name does not meet any of the requirements stated above; ACRA will reject the proposed business name.
- For Singaporean/ Singapore Permanent Resident – Individual’s Details:
For Singaporean or Singapore Permanent Resident registering for Partnership, Singpass is required for the registration. The Individual must not be an undischarged bankruptcy and prior to the registration, the individual must ensure that there is no outstanding amount in his/her Medisave account. These criteria apply for the subsequent renewal of business registration.
- For Foreigners/ Foreign Entities – Managers:
For Foreigners regardless of their residency, they are required to appoint at least one local manager in order to register for a Partnership in Singapore. The same applies for Foreign Entities. It is important to note that the manager to be appointed must be an resident in Singapore which meant that he/she has to be a Singapore citizen, a Singapore permanent resident, a person who holds an Employment Pass, EntrePass or a Dependants’ Pass.
- For Foreigners/ Foreign Entities – Registered Filing Agent:
Foreigners or Foreign Entities looking to register a Partnership in Singapore must engage the services of a registered filing agent such as a law firm, accounting firm or corporate secretarial firm to submit the application on their behalf. This is due to the fact that foreigners and foreign entities do not own a Singpass account and the application can only be done by individuals with a Singpass or Corppass account.
Read More: W.L.P Business Registration Service
- Registered Address:
All business entities in Singapore are required to have a registered business address. It must be a physical address in Singapore and do note that a P.O. Box address is not allowed to be used as the registered business address.
- Singapore Standard Industrial Classification (SSIC Code):
The Singapore Standard Industrial Classification (SSIC) is the national standard taken by Singapore for classification of economic activities undertaken by Singapore Registered Business Entities. In brief, the SSIC code describes the nature of your business activities. A Singapore Registered Entitiy must have at least one SSIC code and a maximum of 2 SSIC codes that best match the nature of their business.
Tools: SSIC Code Search (ACRA)
Why Register a Partnership in Singapore – The Advantages
- The process for registration and cessation of business for Partnerships are relatively easy and fuss free
- Transfer of and Selling off the Partnership can be done easily through a name transfer providing that the new owner/ partner is qualified to own and manage a Sole-Proprietorship/ Partnership.
- Compliance requirements are minimal and resolutions are not required for changes in business details hence there is lesser administrative paperwork in comparison to a Private Limited Company.
- Annual General Meeting and Annual Returns filing are not required at every financial year.
- Accounting matters are simplified (Only 4-line statements are required) for Partnerships with revenue less than S$500,000.
- Profits after deducting all operating expenses belong to the partners of the Partnership based on the percentage agreed by all partners.
- No need for computation of corporate taxes as the profits of a Partnership is taxed at a personal income tax level or each partner.
- All partners are responsible for all debts and losses incurred by the business, which meant that he/she can be sued it his/her own name. Hence, personal assets will be affected during the course of business.
- Registration of the Partnership has to be renewed, the business registration can be automatically cancelled by the Registrar should the partner(s) failed to renewed the business registration on time.
- Partnership is excluded from tax exemptions and corporate tax rebates which is only applicable to other type of business entities.