What does a private limited company in Singapore mean

Are you planning to start a business in Singapore? Building a business is a very tough decision to make because of the risk and also the time involved to build a business that is going to keep you above water in terms of income and also for you for you to build something that you will enjoy building for your future and also to change the world.

We are writing this article as Singapore Company Registration and Incorporation Services provider to let you understand what some of the meanings are and what to watch out for when you are starting your own business.

What does building a private limited company actually mean? Being a sole proprietor can be easy. Register an account and you can start trading but there are many down sides when you think about it when you want to register a sole proprietorship company. Risk are involved when you trade in your personal name, namely when you going into liabilities like say loaning from a bank or when you trade on credit from your suppliers. This are the situations where you may be personally liable to the debts of the business. What does that mean you may want to ask? Being personally liable will mean that you have to pay up for any lapses personally if you were to get into trouble with your finances and your cash flow. You would not want your houses or your cars to go away just because of a bad decision made at work.

This means if you are not able to pay up for your business liabilities, there may be a situation where you have to sell your car or sell your house to make up for the debts that you may have. This is very disruptive to your lifestyle if you were to get into trouble because of a business sand this is something that most businessmen would like to minimize or even avoid when they are trading to make more money. Incorporating a new company might be a good way to deal with this.

Business liabilities can cause you many troubles when it comes to bad cash flow and the best way is actually to set up a private limited firm to be an intermediary.

You own shares in a private limited firm which in turns run the business, you are limited by the amount of capital your enter into the company and this is great for you as a business owner because if you only put in about 1000 in the company, your max loss is 1000, of course there are reasons to raise that amount. The bank may require it if you are taking up a loan, a supplier might want to have that amount there to be more confident of you or you might be dealing with the government which might want to see that you are an established business with good financial backgrounds and backings.

Find out more about incorporation services in Singapore today and do your company registration with Koh Management Pte Ltd and their related companies.

T.K is an avid writer on business topics, he writes for Koh Management