General Partnership is a multi-owner business structure in Singapore. There should be at least two partners with a maximum of 20. If there are more than 20 partners, a corporation must be incorporated.
The partners’ responsibility in a general partnership is unbounded since it lacks the power to create a separate legal organisation. Therefore, each partner is subject to personal taxation on their income. Setting up a general partnership is a great alternative to incorporating a corporation or sole proprietorship.
Each partner is personally responsible for the company’s obligations. The responsibility of the partners is still uncapped. Each partner is liable for the debts and losses incurred by the others.
Which Benefits Do General Partnerships Offer?
Similar to a sole proprietorship, a general partnership has unlimited liability. Additionally, keep in mind that each partner is accountable for the conduct of the others, which makes you even more vulnerable in this arrangement. Because of this, one should only choose this kind of company if all other options are unsuccessful.
The Essentials of General Partnerships
Consensus is one of the critical concepts of a general partnership. Any major choice affecting the way your organisation is run must be agreed upon. Make sure the partnership agreement specifies the circumstances in which a partner may overrule consensus and the procedure that must be followed.