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A sole proprietorship is the simplest way to trade in Singapore. One person owns it and runs it. ACRA, the Accounting and Corporate Regulatory Authority, registers it through BizFile. The price is low and the paperwork is light, but the law treats you and the business as the same person. Figures here were checked on .
How much does it cost to register a sole proprietorship?
You pay ACRA twice: a name application fee and a registration fee. The registration period decides the second one.
| Registration period | Name fee | Registration fee | Total |
|---|---|---|---|
| One year | S$15 | S$100 | S$115 |
| Three years | S$15 | S$160 | S$175 |
The three-year option only applies if the CPF Board's conditions are met, so check with the CPF Board first. Renewal later costs S$30. ACRA charges S$60 to file a Notice of Error through general lodgement. You can pay by credit card, debit card or online banking.
Most registrations are approved soon after payment. Complex ones can take up to 15 working days, and anything that needs a referral authority can take 14 to 60 days.
Who is allowed to register one?
ACRA sets these rules for locals:
- You are 18 or older.
- You are a Singapore citizen, permanent resident or an eligible FIN holder. FIN holders must confirm with their pass issuer, such as MOM or ICA, that they can register a business.
- You are not an undischarged bankrupt, unless the High Court or Official Assignee approves.
- Your Medisave contributions are up to date.
Overseas foreigners use a corporate service provider and name an authorised representative who is ordinarily resident. A foreigner without Singpass cannot register alone. If you want to live in Singapore to run the business, MOM approval comes first. The company registration for foreigners page explains the company route, which is usually the one that works for people on a pass.
What are the risks of a sole proprietorship?
Unlimited liability is the main one. If the business owes money, creditors can pursue your savings, your car and your home. A sole proprietorship is also not a separate legal entity, so it lasts only as long as you are alive and choose to continue it. A company, by contrast, exists until it is formally wound up or struck off.
There is also a Medisave tie. You must keep self-employed Medisave contributions current, and you must top up before you can renew. Late payments can get the registration cancelled.
How does it compare with a private limited company?
| Point | Sole proprietorship | Private limited company |
|---|---|---|
| Owners | One owner | At least one shareholder, up to 50 |
| Legal status | Same person as the owner | Separate legal entity |
| Liability | Unlimited | Limited for shareholders |
| Set-up fee to ACRA | S$115 for one year | S$315 |
| Tax | Personal income tax rates | Corporate rate |
| Yearly filings | Renew registration | AGM, annual return, tax, financial statements |
ACRA says a company gives the best protection for your own money but comes with the most rules and yearly paperwork. Read the private limited company page for the duties that come with that protection.
How is a sole proprietor taxed?
ACRA states that profits are taxed at your personal income tax rates, not at the 17% company rate. The company tax reliefs on the corporate tax page are for companies. Check with IRAS how to report your business income in your own tax filing. If your taxable turnover goes above S$1 million, GST registration becomes compulsory, which the GST registration page covers.
How do you register, step by step?
- Reserve a business name in BizFile. Pick the entity type now, because you must register the same type.
- Log in with Singpass. Foreigners without Singpass need a corporate service provider using Corppass. See BizFile and Corppass.
- Enter the proposed start date, a business email and the business address. A P.O. Box is not accepted.
- Add the owner's NRIC or FIN, full name, date of birth, residential address and contact details.
- Choose one or three years and pay.
ACRA sends all official letters to the owner's residential address, so keep it current. When you stop trading, you close a sole proprietorship by formally ceasing operations. ACRA can also cancel the registration if you do not renew it or the business is no longer running.
When should you pick a company instead?
A company fits better when you sign large contracts, hire staff, take on debt, bring in partners or investors, or want your home and savings kept apart from business risk. A sole proprietorship fits a small service business with low risk and one owner. If you are unsure, compare the real cost of both on the company formation cost page.
Independent guide
SingaporeCompanySetupGuide.com is a free, independent guide. We are not ACRA, IRAS or MOM, and we do not register businesses ourselves. If you want a provider to register a company for you, the next page has a quote form and passes your request to suitable firms.
Sources
- ACRA, Step 2: Choosing a business structure, https://www.acra.gov.sg/register/business/choosing-business-structure/ (rules, liability, fees)
- ACRA, Registering a sole proprietorship or partnership, https://www.acra.gov.sg/register/business/registering-different-business-structures/sole-proprietorship-or-partnership/ (registration requirements, processing time)
- ACRA, Service and transaction fees: Sole proprietorships and partnerships, https://www.acra.gov.sg/how-to-guides/sole-proprietor-and-partnership-fees (renewal and other fees)
- IRAS, Do I need to register for GST, https://www.iras.gov.sg/taxes/goods-services-tax-(gst)/gst-registration-deregistration/do-i-need-to-register-for-gst (GST threshold)
