Partnership

 Limited Liability Partnership (LLP). 





An LLP is a new vehicle for doing business in Singapore. 



The LLP Act will commence on 11 April 2005.

The LLP will give the owners the flexibility of operating as a partnership whilst giving them limited liability. It combines the benefits of a partnership with those of private limited companies. However this comes with safeguards in law to minimize abuse and provide protection to parties who deal with the LLP. 

The LLP is a body corporate and has a legal personality separate from its partners. The LLP has perpetual succession. Any change in the partners of a LLP shall not affect its existence, rights or liabilities. 



An LLP is capable of:

• Suing and being sued in its name;
• Acquiring and holding property in its name;
• Having a common seal in its name; and
• Doing such other acts and things in its name, as bodies corporate may lawfully do and suffer.

The partners of the LLP will not be held personally liable for any business debts incurred by the LLP. However a partner may be held personally liable for claims from losses resulting from his own wrongful act or omission. But a partner shall not be personally liable for such wrongful acts or omissions of any other partner of the LLP. An LLP is required to keep such accounting and other records that will sufficiently explain the transactions and financial position of the LLP. This will enable profit and loss accounts and balance sheets to be prepared to give a true and fair view of the state of affairs of the LLP. If the LLP does not do so, the LLP and every partner shall be guilty of an offence. The punishment may be a fine or imprisonment, or both. In addition, the LLP shall submit to the Registrar an annual declaration of solvency or insolvency. Such solvency status reported shall be available to the public. 

 Sole-Proprietorship. 



Advantages of a Sole-Proprietorship

• The simplest of all new businesses or company start ups – quick to establish and requires only a small registration fee.
• Minimum capital required – Dependent on the nature of the business
• Freedom in management decisions
• No filing of annual return except personal tax returns with the Inland Revenue Dept(IRAS)
• To prepare certified accounts if the turnover of the company exceeds S$500,000
• No requirement to appoint an auditor or corporate secretary

Disadvantages of a Sole-Proprietorship

• Unlimited liability for a Sole-Proprietorship. Personally liable for debts incurred by his business and will have to sell his personal assets(Eg. Car, house, etc.) to repay the outstanding debts.
• Sole proprietors are personally liable for all wrong doings done in the capacity of the business.
• Limited borrowing powers. Banks would not normally grant loans or facilities to small businesses unless the borrower has assets to serve as security.

 Why Incorporate? 



Advantages of an offshore company

• No tax and filing requirements.
• Strategic holding for China & international investments.
• Is a corporate entity.
• May issue bearer shares, as well as shares wit.h variable voting rights
• May denominate shares in any currency or issue shares with no par value.
• May elect not to file any information with the Registrar of Companies relating to shareholders, mortgages and charges, deeds and other instruments of transfer.
• May elect not to disclose any particular information on the Company's letterhead.
• May elect not to prepare financial statements or appoint auditors.
• Totally exempt from BVI income tax and stamp duties. very flexible nature making it an ideal corporate vehicle for international trading, asset protection, investment management, trustee arrangement and e-commerce.

Restrictions

Offshore companies are prohibited from carrying on any business with persons residing in the offshore countries and from owning an interest in real property in the offshore countries(except for the State of Delaware).

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Comparision Chart

Corporate Requirements	British Virgin Islands	State of Delaware, U.S.A.	Samoa	Mauritius	Bahamas	Panama
Min. no. of Shareholders	1	1	1	1	2	1
Min. no. of Directors	1	1	1	1	2	3
Standard Authorised Capital	USD 50,000	USD 3,000	USD 1,000,000	USD 100,000	USD 50,000	USD 1,000
Tax on Offshore Profits	NIL	NIL	NIL	NIL	NIL	NIL
Audited Accounts	NO	NO	NO	NO	NO	NO
Annual Return	NO	YES	NO	NO	NO	NO