What is a subsidiary company?

What is a subsidiary company how is it different from other ownership type in a company.

A limited liability company that is incorporated locally and where a corporate entity holds the majority of stocks is called a subsidiary company. The corporate parent body can be local or foreign. It is considered a separate legal entity. However, the business activities carried out by a subsidiary can be either the same or different from that of the parent company.

Most of the foreign companies who wish to establish a presence in Singapore chose this as an option. They can hold 100% shares of the Singapore subsidiary company and can enjoy all the tax benefits.

It is also exempted from the annual audit of the accounts as it qualifies as a small company.