A Limited Liability Partnership (LLP) is a business structure that combines features of a partnership with the benefits of a separate legal entity. It can suit professional practices, joint ventures, family businesses and other ventures where two or more parties want flexibility in managing their relationship while limiting exposure to liabilities arising from the LLP or from the acts of other partners.
An LLP registered in Singapore is a separate legal entity from its partners. It can own property, enter into contracts, incur debts and sue or be sued in its own name. It also has perpetual succession, so a change in partners does not by itself end the LLP's existence.
A partner is generally not personally liable for the LLP's debts or obligations merely because the person is a partner, and is generally not personally responsible for another partner's wrongful acts or omissions. A partner remains personally liable for losses arising from that partner's own wrongful act or omission.
The partners can generally regulate their rights and duties through an LLP agreement, covering matters such as capital contributions, management responsibilities, voting rights, allocation of profits and losses, admission or retirement of partners, transfer restrictions and dispute resolution. A properly drafted agreement is strongly recommended even though it is not normally filed with ACRA as part of registration.
An LLP is a separate legal entity for legal purposes but is generally treated as tax transparent for Singapore income tax purposes. The LLP itself is therefore not normally taxed on its income at entity level. Instead, each partner is taxed on that partner's allocated share of the LLP's income.
An individual partner's share is generally taxed at the applicable individual income tax rates, while a corporate partner's share is taxed at the applicable corporate income tax rate. Special rules restrict the amount of certain capital allowances and trade losses from an LLP that a partner may set off against income from other sources. Tax exemption schemes designed specifically for companies, such as the Start-Up Tax Exemption and Partial Tax Exemption schemes, do not apply to an LLP itself.
An LLP must have at least two partners. A partner may generally be an individual or a body corporate, and the partners may be local or foreign.
Every LLP must have at least one manager who is ordinarily resident in Singapore. The manager must be a natural person, at least 18 years old, mentally capable of carrying out the role and not prohibited from acting as an LLP manager. An undischarged bankrupt is subject to restrictions unless the necessary approval has been obtained.
The LLP must maintain a registered office address in Singapore where official communications and notices can be sent and records and registers may be maintained. The registered office must be open and accessible to the public during normal business hours on each business day. It does not have to be the place from which the LLP conducts its day-to-day business.
The proposed name must be approved and reserved with ACRA through Bizfile. It must not be identical to an existing or reserved business name, undesirable or otherwise prohibited. Certain names may require referral to another government agency. An LLP's name must end with “Limited Liability Partnership” or “LLP”. The current ACRA name application fee is S$15, and an approved name is normally reserved for 120 days.
The information required generally includes the approved LLP name, LLP email address, registered office address, details of all partners, details and consent of the manager or managers, relevant residential and contact addresses and information concerning the LLP's registrable controllers unless exempt. An LLP agreement should also be prepared where appropriate, although it is not normally filed as part of the registration application.
An eligible individual with Singpass may be able to register the LLP directly through Bizfile. Foreigners without Singpass must engage an ACRA-registered Corporate Service Provider (CSP) to carry out the registration. Where the application is not filed by a CSP, relevant partners and managers may be required to endorse their appointments through Bizfile. The current endorsement period is 60 days; where a CSP files the registration, the position-holder endorsement requirement generally does not apply.
The current ACRA fees are S$15 for the name application and S$100 for LLP registration. Professional fees charged by a CSP are separate.
Following registration, the partners should put practical and governance arrangements in place, such as executing the LLP agreement, opening a business bank account, establishing accounting procedures, considering appropriate insurance and obtaining any business licences or regulatory approvals required for its activities.
Every LLP must file an annual declaration of solvency or insolvency with ACRA. For a newly registered LLP, the first annual declaration is due 15 months after registration. Subsequent deadlines are determined in accordance with the statutory annual-declaration requirements. The current filing fee is S$30.
An LLP must maintain proper accounting and other records sufficient to explain its transactions and financial position. An LLP's accounts do not generally have to be audited under the LLP Act, but proper accounts remain necessary for tax, regulatory and management purposes.
Unless exempt, an LLP must maintain a Register of Registrable Controllers and file the required controller information with ACRA's Central RORC. Where controller information changes, the LLP must update its private RORC within the applicable statutory timeframe and then file the corresponding Central RORC update. Under the current regime, the private RORC is generally updated within seven days, with the Central RORC update filed within two business days after the private register is updated. The LLP must also carry out the required periodic verification of controller information.
Changes to matters such as the LLP's partners, managers, their particulars or the registered office address must generally be filed with ACRA within 14 days.
The LLP's name should be followed by “Limited Liability Partnership” or “LLP”. Its invoices and official correspondence must also contain the required LLP identification information, including its registration number and the required statement concerning its limited liability status.
The precedent partner is responsible for filing the Partnership Income Tax Return, Form P, on behalf of the LLP. From Year of Assessment 2027, e-Filing of Form P is compulsory. The income or loss allocated to each partner is then taken into account in the partner's own income tax filing in accordance with the rules applicable to that partner.
An LLP is subject to the general GST registration tests applicable to other businesses. Compulsory GST registration may arise where taxable turnover exceeds S$1 million for the calendar year under the retrospective test, or can reasonably be expected to exceed S$1 million in the next 12 months under the prospective test. Different application and effective-registration timelines apply depending on which test is triggered. An LLP that is not required to register may also consider voluntary GST registration if it meets IRAS's conditions.
An LLP can be attractive where two or more parties want partnership-style flexibility and tax transparency while operating through a separate legal entity. A private limited company may be more appropriate where the business intends to raise equity investment, retain and reinvest profits at company level, issue different classes of shares or eventually introduce a larger number of investors.
The appropriate structure depends on who will own and manage the business, whether the owners are individuals or corporate entities, how profits will be distributed or reinvested, the expected tax profile, liability and regulatory considerations, and the business's longer-term financing and ownership plans.
Apexia Corporate Advisory assists local and foreign businesses with the establishment and ongoing administration of Singapore LLPs. Our services include LLP registration, registered office services, corporate and regulatory compliance, accounting and bookkeeping, GST registration and compliance, partnership tax filings, and ongoing advisory and administrative support.
If you are deciding between an LLP and a private limited company, we can also help you assess the practical, compliance and tax implications of each structure before registration. Contact Apexia Corporate Advisory to discuss setting up and maintaining your Singapore LLP.
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