Singapore is renown as a hub for starting or expanding businesses. But why choose Singapore as an ideal place for starting a private limited company? Read further to understand why Singapore is a preferred destination or companies.
Most of the companies that are being registered in Singapore are registered as Private limited companies. A private limited company is a legal body on its own, separate from its shareholders. The shareholders are not liable beyond what the shareholder invests.
There are three key advantages that one can choose Singapore for their venture:
- Low taxation:
Singapore has a 17% tax which is one of the lowest in such a fast paced economy which makes it an amazing choice for investors. Also, income that is sourced from outside of Singapore is not taxable in Singapore. Capital gains are also not taxable in Singapore which proves to be very cost effective for companies. Also, Singapore follows a single tier tax system rather than a two tier tax system that is mostly followed elsewhere- that means that the company is taxed only once at the corporate level and not any time after that.
- Identity as a separate legal entity
The private limited company is considered to be a legal entity on its own that can sue or be sued. And liability is limited for the shareholders. That is, if the company is in debt, the shareholders contribution is limited to what they invest. In Singapore, the number of shareholders required in a company – the minimum number is as low as one.
- Credibility and easy transfer of ownership:
As a private limited company, it stands a better chance of credibility than a partnership company or sole proprietorship company. Also, it will attract more investors to invest in the company as it sells the image of growth.
Ownership transfer can be executed easily either fully or partially without complex formalities. There is no need to shut down the company in case of death and the ownership can be transferred by selling the whole or part of shares. Singapore law makes this process much easier and hence private limited company is obviously a good choice for investors.
To sum up, a private limited company in Singapore offers innumerous benefits and offers ample choices for the investor. These incentives offer the investor a competitive edge with regards to their clients, investors and business authorities.