Sole proprietorship is the most dynamic and the easiest Singapore business setup.
Having one person to own the whole asset as well as the liabilities and responsibilities of the business is the most ideal setup of a micro and small business operations.
With the flexibility and dynamism of having one person to own the company, he can address to every concern even to the most minute detail which is a wise thing to do for a business to prosper. This capacity is attributed to having full control and authority of solely owning a business.
While sole proprietorship has its advantages it certainly has it disadvantages such as the business owner is personally liable for all the claims, lawsuits, debts, and financial losses of his business which is viewed as his legal extension.
Below are the main characteristics of the sole proprietorship:
*The owner or the sole proprietor is totally responsible for the whatever claims, lawsuits, financial obligations and other drawbacks pertaining to his business.
* The business is not treated as a separate entity from its owner.
* The business is not intrinsically considered a “legal entity” so it cannot own properties, obtain supplies and make a lawsuit under its name.
*The business is not a separate legal entity from the sole proprietor.
Just like any business structures, the sole proprietorship has its pros and cons which must be greatly considered by entrepreneurs:
The Basic Advantages
Because there is only one owner, it is very easy for him to sell and transfer his business anytime he wants to because there is no need to seek the approval of other co-owners.
With this, the business is usually easy to liquidate compared to other setup such as partnership and corporation.
Also, being the sole proprietor means that a person can enjoy all the profits and earnings of his business without having to divide these to other people.
Another advantage of this setup is that the sole proprietor is not obligated to perform complicated compliance matters and procedures. In fact, he is not even required to submit his annual returns since he is only taxed at a personal income rate.
Paying off the debts and other financial obligations would seem challenging in a sole proprietorship setup, unlike any other setup because being the sole owner would entail using even personal assets and acquisitions to pay off whatever unfavorable business circumstances. Raising up the required assets and capital to make the business viable would also be challenging for a sole proprietor since he doesn’t have anyone to share it with.
Since 1998, Rikvin (www.rikvin.com) consultancy has been providing highly professional company incorporation services, both in attractive standard packages as well as customised services. Online incorporation being a hallmark service, other services of Rikvin include Singapore Sole Proprietor, Singapore Company Offshore Incorporation, EntrePass, Singapore Employment Pass, Personalised work Pass ap