top of page
  • a22162

Registering a Limited Partnership

Updated: Dec 31, 2023


Registering a Limited Partnership | Bestar
Registering a Limited Partnership | Bestar

Understanding Limited Partnerships


A Limited Partnership (LP) is a type of business structure in Singapore that combines the features of a general partnership and a limited liability company. It offers flexibility and tax benefits to businesses operating in Singapore.


Key Features of Limited Partnerships in Singapore:


  • Minimum of Two Partners: An LP must have at least two partners, with at least one general partner and one limited partner.

  • General Partner Liability: General partners have unlimited liability for the debts and obligations of the LP. This means that they are personally responsible for the LP's financial obligations.

  • Limited Partner Liability: Limited partners have limited liability for the debts and obligations of the LP. This means that their liability is limited to the amount of their agreed capital contribution.

  • No Separate Legal Entity: An LP does not have a separate legal entity from its partners. This means that the LP cannot sue or be sued in its own name, and it cannot own property in its own name.

  • Taxation: LPs are considered "pass-through" entities for tax purposes. This means that the profits of the LP are passed through to the partners, who are then taxed on their individual shares of the profits.

Benefits of Limited Partnerships in Singapore:


  • Flexibility: LPs offer flexibility in terms of ownership structure and management. Partners can agree on their respective roles and responsibilities in the LP.

  • Limited Liability Protection: Limited partners enjoy limited liability protection, which safeguards their personal assets from the LP's debts and obligations.

  • Tax Benefits: LPs are considered "pass-through" entities for tax purposes, which can offer tax benefits compared to other business structures.


Suitable Businesses for Limited Partnerships in Singapore:


  • Professional Services Firms: LPs are commonly used by professional services firms, such as law consulting firms.

  • Investment Partnerships: LPs are also suitable for investment partnerships, as they allow investors to pool their capital and share in the profits of a particular investment.

  • Family Businesses: Family businesses can also benefit from the flexibility and limited liability protection offered by LPs.


When registering an LP:


  • Indicate if it falls under Regulation 12: This means stating whether the LP's primary purpose is establishing an investment fund managed by a licensed fund manager.

  • Provide the licensed fund manager's name: If applicable, name the licensed fund manager, who could be either the general partner or an appointee.


Regulation 12 is triggered when:


  1. Investment fund focus: The LP is primarily created to establish a fund for investment purposes.

  2. Licensed fund manager: The fund is managed by a "licensed fund manager," meaning someone licensed under the Securities and Futures Act (Cap. 289) to conduct fund management business. Exemptions from this licensing requirement can be granted under Section 99 of the Act.


How to Register a Limited Partnership in Singapore:


  1. Choose a Business Name: Ensure the chosen name is unique and complies with ACRA's guidelines.

  2. Apply for a Unique Entity Number (UEN): The UEN is a unique identification number for businesses in Singapore.

  3. Appoint a Registered Filing Agent (Optional): A registered filing agent can assist with the registration process.

  4. Provide Required Documents: Gather the necessary documents, including the LP Registration Form, partner details, and business name approval letter.

  5. Submit Registration Application: Submit the completed application and supporting documents through BizFile+.

  6. Obtain Business License (if applicable): Apply for the required business license after LP registration.


Additional Considerations:


  • Partnership Agreement: Clearly define the roles, responsibilities, and profit-sharing arrangements among partners.

  • Tax Implications: Consult a tax advisor to understand the tax implications of forming an LP.

  • Legal and Regulatory Compliance: Ensure adherence to relevant laws and regulations governing LPs in Singapore.


Limited Partnerships offer a flexible and tax-efficient business structure for many types of businesses in Singapore. By understanding the key features, benefits, and registration process, entrepreneurs can make informed decisions about whether an LP is the right choice for their business venture.


Partners and Managers of Limited Partnerships


In a Limited Partnership (LP), partners and managers play distinct roles in the business's operation and decision-making processes.


Partners


Partners are the individuals or entities who own and operate a Limited Partnership. They are responsible for the overall management and direction of the LP, including making financial decisions, entering into contracts, and hiring employees. There are two types of partners in an LP:

  1. General Partners: General partners have unlimited liability for the debts and obligations of the LP. This means that they are personally responsible for the LP's financial obligations if the LP cannot pay its debts. General partners also have full management authority and can make decisions on behalf of the LP.

  2. Limited Partners: Limited partners have limited liability for the debts and obligations of the LP. This means that their liability is limited to the amount of their agreed capital contribution. Limited partners do not have full management authority and cannot make decisions on behalf of the LP. They can only participate in management decisions if the LP agreement specifically allows it.

Managers


Managers are individuals appointed by the partners to manage the day-to-day operations of the Limited Partnership. They are responsible for implementing the decisions made by the partners and ensuring that the LP operates efficiently and effectively. Managers may also have limited liability for the debts and obligations of the LP, depending on the terms of their appointment.


The appointment of managers is not mandatory for Limited Partnerships in Singapore. However, it is recommended if all general partners are not residing in Singapore. In such cases, a local manager must be appointed who is at least 18 years of age and is a natural person of full capacity.


Key Responsibilities of Partners and Managers

  • Partners:

    • Provide funding for the LP

    • Make financial decisions

    • Enter into contracts

    • Hire employees

    • Oversee the management of the LP


  • Managers:

    • Implement the decisions made by the partners

    • Manage the day-to-day operations of the LP

    • Supervise employees

    • Ensure compliance with legal and regulatory requirements


Relationship between Partners and Managers


Partners and managers have a fiduciary duty to act in the best interests of the Limited Partnership. This means that they must make decisions that are in the best interests of the LP and its partners, and they must not put their own interests ahead of the LP's interests.

The partnership agreement should clearly define the roles and responsibilities of partners and managers, as well as the decision-making process within the LP. This will help to avoid misunderstandings and conflicts between partners and managers.


Foreigners and Limited Partnerships

Foreigners can be partners or managers of Limited Partnerships (LPs) in Singapore. There are no restrictions on foreign ownership of LPs, and foreigners are not required to hold a work pass in Singapore to be a partner or manager of an LP.


However, there are a few additional requirements for foreign partners and managers of LPs in Singapore:


  • Appoint a Local Manager: If all general partners of an LP are not residing in Singapore, a local manager must be appointed. The local manager must be at least 18 years of age and must be a natural person of full capacity. The local manager is responsible for discharging all obligations of the LP and is subject to the same responsibilities, liabilities, and penalties as a general partner of the LP.

  • Obtain Work Pass (if applicable):Foreigners who wish to be present in Singapore to manage the operations of an LP must seek approval from the Ministry of Manpower (MOM) after registering the LP. The foreigner must engage the services of a registered filing agent (e.g., law firm, accounting firm, or corporate secretarial firm) to submit the online application on their behalf.

Foreigners who meet these requirements can freely participate in the ownership and management of LPs in Singapore. LPs offer a flexible and tax-efficient business structure for many types of businesses, making them an attractive option for foreign entrepreneurs seeking to establish a presence in Singapore.


Registering a Limited Partnership


Registering a Limited Partnership (LP) in Singapore involves several steps, including:


1. Choosing a Business Name: Before registering your LP, you must check the availability of your desired business name with the Accounting and Corporate Regulatory Authority (ACRA). You can do this through ACRA's Online Business Name Search service.


2. Applying for a Unique Entity Number (UEN): The UEN is a unique identification number for businesses in Singapore. You can apply for a UEN online through ACRA's BizFile+ portal.


3. Appointing a Registered Filing Agent: If you are not familiar with the registration process, you may consider appointing a registered filing agent to handle the registration on your behalf. A registered filing agent is a professional who is authorized to submit documents to ACRA on behalf of businesses.


4. Providing Required Documents: When registering your LP, you will need to provide ACRA with the following documents:


  • Completed LP Registration Form

  • Particulars of Partners (including their names, addresses, and identification numbers)

  • Business Name Approval Letter (if applicable)

  • UEN Application Form


5. Submitting Registration Application: You can submit your LP registration application online through BizFile+. Once your application is submitted, ACRA will review it and inform you of the outcome.


6. Obtaining Business License: If your LP requires a business license, you will need to apply for it after your LP is registered. The type of business license you need will depend on the nature of your business activities.


Processing Time


The processing time for registering a Limited Partnership (LP) in Singapore typically takes 1 day. The exact processing time depends on several factors, including the complexity of the application and whether it requires referral to another agency for approval or review.


Here's a breakdown of the processing time for different scenarios:


  • Standard Application: If the application is straightforward and does not require any referrals, it will typically be processed within 1 day.

  • Referral to Another Agency: If the LP's business activities require approval or review from another agency, such as the Ministry of Education for private schools, the processing time may extend to 60 days.

  • Incomplete Application or Errors: If the application is incomplete or contains errors, ACRA may request additional information or clarification, which can prolong the processing time.


To expedite the processing time, it is recommended to submit a complete and accurate application, ensuring all required documents are included. Additionally, appointing a registered filing agent can assist with the application process and ensure compliance with all requirements.


It is important to note that these are estimated processing times, and the actual processing time may vary depending on the workload of ACRA and the complexity of the application.


Registration Fee


Name Application Fee

​$15

LP Registration Fee (1-year)

​$100

​LP Registration Fee (3-year)

​$160


How Bestar can Help


Bestar can help you register a Limited Partnership (LP) in Singapore in a number of ways:


  • Incorporation services: Bestar can handle all of the paperwork and filings for you, from choosing a business name to submitting your application to the Accounting and Corporate Regulatory Authority (ACRA). This can save you a lot of time and hassle.

  • Compliance advice: Bestar can advise you on the legal and regulatory requirements for registering an LP in Singapore. This includes things like the minimum number of partners required, the types of businesses that can be registered as LPs, and the ongoing renewing requirements.

  • Tax advice: Bestar can advise you on the tax implications of registering an LP in Singapore. This includes things like Goods and Services Tax (GST), and personal income tax.

  • Business bank account setup: Bestar can help you set up a business bank account for your LP. This is essential for receiving and paying out money on behalf of your business.

Here are some of the benefits of using Bestar to register your LP in Singapore:


  • Experience: Bestar has a team of experienced professionals who can help you navigate the LP registration process smoothly.

  • Convenience: Bestar can take care of all of the paperwork and filings for you, so you can focus on running your business.

  • Expertise: Bestar can provide you with expert advice on the legal, regulatory, and tax implications of registering an LP in Singapore.

  • Cost-effective: Bestar's fees are competitive, and we offer a variety of packages to suit your needs.


If you are considering registering an LP in Singapore, contact Bestar for a consultation. We can help you understand the process and the benefits of using our services.


1 view0 comments

Comments


bottom of page