General Partnership — a business structure in Singapore that has more than one owner. A general Partnership does not form a separate legal entity, so the partners’ liability is unlimited. The partners are each taxed with personal tax off their individual income. Setting up a general partnership is an alternative to setting up a company and registering as a sole propritetorship.
What are the advantages of a General Partnership?
General Partnership is similar to Sole Proprietorship in a way that the liability is Unlimited. You also have to remember that each partner is responsible for the actions of the others, which further exposes you in this format. This is why one should only consider choosing this type of business organization if the other ones definitely fail to fit the purpose.
What you need to know about General Partnership
One of the crucial terms in a General Partnership is consensus. It must be reached to agree on any important decision that concerns your business operation. Make sure that the partnership agreement includes provisions on when a partner can override consensus, and the process required to do so.
General Partnership examples in Singapore
You are a cupcake baker and you want to partner up with a friend who is expert in macarons. You decide to set up a baking consultancy “Cupcakes and Macarons Gurus”. Each of your will be managing your own clients and offering your own product.
What are the types of Partnerships in Singapore?
There are 4 types of business partnerships:
- Limited partnership
- General partnership
- Limited liability partnership
- LLC partnership
Is a Partnership Business taxed?
Since Partnerships aren't the same as an Incorporated Business, the IRS can't tax them directly. But IRS will tax the profits that each individual partner has.
What's the difference between General partnership and Limited partnership?
Limited partners aren't involved in a day-to-day management of their business. General partners can invest money and they may also be responsible for the company's debts, while the limited partner isn't.