Overview: LLP Registration In Singapore
Singapore provides company owners with a welcoming climate and access to advanced infrastructural facilities. In addition, Singapore has many regulations that are supportive of business, such as low tax rates, significant incentives for new businesses, and simplified regulatory processes.
Choosing the sort of business structure to be established is crucial when forming a company in Singapore. There are several kinds of structures of business in Singapore, and a limited liability partnership is also one of them.
A Limited Liability Partnership (LLP) is a form of corporate organization that combines the advantages of a partnership with limited liability protection for its members. Owners of an LLP have the freedom to do business as a partnership while maintaining a distinct legal status, much like a private limited corporation. In Singapore, an LLP is required to consist of two partners. A partnership contract has to be made by the solicitor before initiating the Singapore LLP.
In this article, we will briefly discuss LLP registration in Singapore. We will explore the benefits, characteristics, and documents required for Limited Liability Partnership registration in Singapore.
Documents Required to Start an LLP Registration In Singapore
Certain documents are mandatorily needed for LLP registration in Singapore. They are:
- The chosen name of the LLP.
- Detailed info on the managers or partners of the LLP. Applicants need to submit their Singapore ID pass or foreign passport.
- Registration elements of the firm behaving as LLP’s associate (registered address, jurisdiction, registration number, etc)
- Singapore residential documents of the managers or partners
- The listed address of the office of LLP
- Declaration of compliance
- Agreement to hold the position of a manager and a declaration of Non-Disqualification
LLP Registration Process In Singapore
Here are the steps to register LLP in Singapore:
Choose and reserve the business name
Select a business name that must not be derogatory or unsuitable, and it must not be identical to any other Singaporean companies already in operation. After selecting the name, submit the name to the relevant authority for reservation of the name. A reserved LLP name is going to be held for 120 days starting from the name’s approval day.
Appoint managers and partners
Every LLP needs a minimum of one manager who is an 18-year-old natural person who resides locally in Singapore. Every LLP must include two partners, who may be individuals, local businesses, international businesses, or other LLPs.
Collect necessary documentation
Collect the necessary documents that must be submitted for LLP registration in Singapore.
Register the LLP
Enroll the LLP with the Accounting and Corporate Regulatory Authority (ACRA). ACRA’s digital filing along with the data retrieval framework, BizFile+, is the accepted method of submission for all applications to register a new LLP. By logging into the BizFile+ portal and entering the relevant information, including the LLP’s name, business address, partners’ information, and manager’s information, you can register the LLP.
Pay the enrollment fee
You have to submit the S$115 registration charge for an LLP online at the BizFile+ website.
Characteristics Of Limited Liability Partnership
A Singapore LLP needs to have the following important characteristics:
- Either sue another firm or can get sued
- Should be a separate legal firm
- Eligible partners can be firms, LLPs, or individuals
- Requires at least 2 associates
- Possess and maintain assets in its name
- The obligation of associates is restricted till damage as a result of their consequences
- Should incorporate ‘LLP’ or ‘limited liability partnership’ in its title
- Keeping a common seal in the LLP name
Advantages Of LLP Registration In Singapore
Here are some of the advantages that one would get after LLP registration in Singapore:
Distinct Legal Entity: In Singapore, LLPs have the recognition of a distinct legal organization, which entitles the company to enter into agreements, bring legal action, and be sued on its behalf.
Perpetual succession: The everlasting succession of an LLP ensures that its existence, rights, and obligations are unaffected by changes in its partners.
Limited liability protection: Limited liability protection is offered to partners in LLPs. As a result, the partners’ private possessions are shielded from the financial liabilities and obligations of the company. The associates can be held liable for the obligations, but only for the number of shares they’ve put into the firm.
Disadvantages Of LLP Registration In Singapore
After learning about the advantages, let’s take a look at the disadvantages of LLP registration in Singapore:
- In all instances, 2 partners are required.
- Limited partners can enter into formal business contracts on behalf of the LLP without the assent of the other members.
- LLPs do not allow for the flexibility of transfer of ownership and funding that a corporate structure does.
- There are no corporation tax breaks. The tax breaks provided to privately owned corporations do not apply to LLPs. A Limited liability partnership is tax neutral, which implies it isn’t taxable as a separate entity. Rather, each partner gets charged on their portion of gains at the same rates as individuals.
Terms And Conditions For LLP In Singapore
Following the completion of the incorporation of an LLP, the associates of the partnership won’t be considered personally accountable for any commercial debts owed by the Limited liability partnership. An associate, on the contrary, might be deemed personally accountable for allegations of losses stemming out of his bad actions or misconduct, but not for the unlawful actions or inactions of any other associate of the Limited liability partnership.
It is now time to begin business operations after finishing the LLP authorization. Nonetheless, after beginning business operations, a Limited liability partnership is obliged to keep accurate financial records, balance sheets, and profit and loss accounts to adequately describe the LLP’s activities and economic state. If the Limited liability partnership fails in it, the Partnership and each partner may be investigated, and a fine, penalty, jail, or both, may be imposed. A partnership that has achieved LLP authorization and begun company operations is conferred with an extra legislative requirement that must be met.
Read More: Import-Export Business in Singapore
Importance of LLP Name
The name of the LLP is its most important aspect, and that’s why one should pay the maximum attention while selecting a name.
The title cannot be modified, published, or allocated when:
- It is unpleasant.
- It’s similar to another LLP, business, or company, or to a firm name protected under the Partnership Act, Companies Act, or Business Registration Act.
- It’s identical to the types of titles that the government has advised the company registrar to not approved for certification.
You must also take precautions and prevent choosing a title that is similar to the identity of another corporate entity. This prevents the title of an LLP from being confused with the title of another corporate entity.
Conclusion
For business owners who want to launch a venture, establishing a Limited Liability Partnership (LLP) in Singapore has a number of advantages. Creating an LLP in Singapore is a flexible and economical corporate structure that gives the advantages of perpetual succession and limited liability. A limited liability partnership (LLP) must maintain accounting documents, earnings and losses accounts, and balance sheets that adequately describe its transactions and financial status.
If you are looking to register an LLP firm in Singapore, get in touch with our professionals at OnDemand International. Our experts will assist you with the procedures needed to set up your LLP firm.
FAQ’s
It is a company structure in Singapore. A Limited liability partnership allows owners to operate in the form of collaboration while maintaining a separate legal existence, similar to a private limited corporation.
At least two partners (people or businesses) are supposed to enter a partnership business. In addition, at least one manager, typically domiciled in Singapore, and is of 18 years of age or more, must be present. The manager is not required to be an associate and contributes to the administration of the Limited liability partnership.
Singapore partnerships are not taxable at the attribute level; instead, earnings are regarded as part of every partner’s income.
