LLP tax treatment
Does an LLP pay its own income tax?
The situation
No. An LLP is transparent for tax. Each partner is taxed on their share of profit.
The law
- Limited Liability Partnerships Act 2005: Registration of LLPs and yearly declaration of solvency
- Sec 62, Income Tax Act 1947: Every company and individual files an income tax return when required by IRAS
What it means for you
Individual partners report their share in their personal return; corporate partners report in their company return. The LLP files a partnership income declaration. Losses may be shared within limits.
What to do
- Prepare LLP accounts.
- Allocate profit by agreement.
- Each partner reports their share.
- Keep the agreement.
We can do this for youRegister a sole proprietorship, partnership or LLP: SGD 350