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Sole proprietorship, partnership or private limited? Compare liability, tax treatment and credibility before you incorporate.
The structure you choose shapes how you pay tax, how much personal risk you take on and how easily you can raise funds. Most founders eventually move to a private limited company, but understanding the alternatives is still useful.
Sole proprietorship
Simple to register and inexpensive to run. The owner is personally liable for all debts and obligations, and income is taxed at personal rates. Suitable for very small operations with low risk exposure.
Partnership and limited partnership
Two or more individuals share ownership and liability. A limited partnership separates general partners from limited partners, giving investors capped exposure while the operators retain control.
Private limited company
A separate legal entity that protects personal assets and benefits from Singapore's corporate tax regime. This is the structure expected by banks, investors and most enterprise customers.