Business Owners Need to Know Before Incorporating a Sdn Bhd

Establishing a company is an important step towards business development. Knowing the legal requirements to set up a private limited company or Sdn Bhd in advance will save business owners a lot of trouble when filling out the company registration form and allow them to focus their energy on making important decisions for the company.

The following are the top five things that business owners need to figure out before submitting the company registration form to help them successfully register an Sdn Bhd in Malaysia.

1. Company Business and Details

A. Proposed Company Names

According to SSM or Companies Commission of Malaysia, business owners need to propose a company name that meets the following criteria:

  • It does not imply connections to the royal family or government agencies and authorities, such as using the words royal, ASEAN and federal.
  • It does not mislead the business nature.
  • It is not profane or possibly offensive.
  • It is not similar to other registered companies.
  • It does not imply connections with operations controlled by other regulations, such as having the words realtors, insurance and takaful unless approved in writing by the appropriate agency.
  • It does not imply a connection to the activities specified by government bodies or professional agencies, such as having the terms engineer, architects, and co-op unless approved in writing by the appropriate agency.
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    Total clarity is vital in naming the company. If the proposed company name contains words other than Malay and English, it is necessary to explain the meaning of these words when completing the company registration form.

    B. Business Nature and Description

    Business owners need to understand the type of business their company will be involved in. All Malaysian companies use MSIC codes for classification. Business owners who are not sure which category their business belongs to should consult with professional company incorporation agencies.

    C. Business Address and Registered Address

    Registered address and business address do not need to be similar. A business address is where the company conducts its operation, while the registered address is typically the office of the company secretary where notices and communications are handled and should be open to the public during business hours. Companies without a physical store or office do not require a business address.

    2. Eligibility of Directors and Shareholders

    A. Director

    Both Malaysians and foreigners can register as the sole director and shareholder of an Sdn Bhd as long as they are 18 years old and above, live in Malaysia and are not disqualified under Companies Act 2016’s Section 198.

    Nevertheless, foreigners who do not live in Malaysia need a minimum of one resident director to register an Sdn Bhd. It is recommended to have a business partner based in the country.

    B. Shareholder

    An Sdn Bhd can have a maximum of fifty shareholders. During the company establishment, every shareholder will announce how many shares they have. After the company is registered and a corporate bank account is opened, every shareholder must transfer the necessary amount to the account based on the number of shares they own.

    3. Documents Required

    For identity verification, MyKad or passport needs to be presented as the required documentation to register an Sdn Bhd. Business owners intending to register their business through the MyCoID platform must show their MyKad or passport at the SSM counter when they first made an account on the platform.

    In some cases, where the suggested company name contains controlled terms or trademarks, an authorisation letter from the appropriate agency or owner is required.

    4. Paid-up Capital

    The minimum paid-up capital to register an Sdn Bhd in Malaysia is RM 1. Business owners can change the paid-in capital divulged during company incorporation later on. Therefore, it is recommended to limit the capital to RM 10,000 and increase it as the company has more funds after its establishment. Declaring paid-up capital that the company does not have is illegal.

    5. Necessary Payment

    The SSM charges a company registration fee of RM 1,010 (including tax). Business owners that opt for a company secretary to register and establish an Sdn Bhd need to pay a service fee to complete the application form. These fees may differ based on the pricing structure of the secretarial agencies.

    Getting Help From A Professional Company Incorporation Firm in Malaysia

    The process of incorporation of a company in Malaysia can be complicated and taxing. A professional company incorporation services streamline the process and ensure the company stays compliant with every regulatory requirement.

    Business Opportunities in Malaysia

    The COVID-19 pandemic has inevitably endangered world trade, and Malaysia has not been able to escape the hit as well. Large Malaysian companies suffer huge losses and await uncertainty. At the same time, the global economy is in severe crisis, and business opportunities during the pandemic in Malaysia remain slim.

    Nevertheless, while COVID-19 has completely stopped some businesses, certain business ideas managed to succeed and thrive during this difficult time. Here are the top five business opportunities in Malaysia during the pandemic.

    1. Disinfectant And PPE Manufacturing

    During the pandemic, the cleaning and disinfectant industry is at its peak. While this business idea can certainly do well in Malaysia, business owners need to keep in mind that many established sectors have already been involved in this particular field. Therefore, if a new entrepreneur intends to enter this market, they must arm themselves with better and more effective products to gain customers.

    Cleaning services can bring additional income to this industry. If the company has potential or trained human resources, who are especially good at cleaning and disinfection services, it must deploy them for good business at this time. Business owners can utilise their skills to start a cleaning business. They can also carry out the marketing activities of the company’s disinfectant and PPE products at the same time.

    2. E-Commerce

    When most of the business giants collapsed, e-commerce seemed to be moving in a different direction. With the growing demand for common items from customers locked in their homes in Malaysia, e-commerce sites seem to be the only convenient and safe option to meet their everyday needs. E-commerce platforms offer a wide range of products, ranging from ordinary groceries to essential medications. Furthermore, this platform provides the best way to order and obtain products without physically getting out of the house.

    During the COVID-19 crisis, e-commerce was one of the fastest-growing businesses in Malaysia. E-commerce not only did a good job on its own but also pulled many other industries out of the ditch, including the product supply chain, delivery business and agriculture. As a result, Malaysia’s e-commerce business was able to satisfy consumers’ demands and assist manufacturers, farmers, and other sectors during this economic downturn.

    3. Online Tutorial Services

    Online tutorial services can generate considerable income even in the dry business season because of COVID-19. Social networking sites like Facebook and YouTube are the main outlets for online tutorial services. These services consider various professional and academic skills development courses for Malaysian and students from all over the world.

    Interested users can enroll in these online courses via paid subscription packages. The benefit of this type of business is that it does not require financial stability, large resources, or big office space. Business owners only need to prepare camera equipment, materials or smartphones, suitable corner space, and good-quality headphones.

    Nonetheless, teaching online does require professional expertise and solid academic knowledge. If the entrepreneurs can meet this condition, then they can easily set up this business.

    4. Online Consultancy

    The lockdown due to COVID-19 can lead to restrictions on social freedom, but no matter what situation Malaysia is in, the need for knowledge and expertise always seems to be valuable. In the consulting business, when all physical offices were closed due to Covid-19, entrepreneurs can still equip themselves properly to offer online consulting services for their valued clients.

    Moreover, business-to-business or person-to-person consulting in a variety of professional fields has increased significantly during the lockdown, thanks to copious online platforms, such as Zoom and Skype.

    5. Live Customer Support

    This field includes customer support and online customer care. Whether it is health support or any other security inquiry that requires laws and compliance, online customer support agencies are in high demand during the pandemic.

    Like many other countries, Malaysia also has a national online customer service and help desk that can handle COVID-19 and patients’ information and other people looking for various information. Many of these online support centers responsibly connect patients with medical staff and people with the services they need. Some providers also offer emergency social services and customers on-demand counseling.

    Getting Help From A Professional Business Registration Malaysia Services

    While these business opportunities can indeed be lucrative, setting up a legally compliant business in Malaysia can be daunting, especially for first-timers. A professional business registration Malaysia services help business owners to register a company in Malaysia without the hassle and ensure the newly-established business adhere to the current regulations.

    Starting a Company in Malaysia As A Foreigner

    Since 2016, foreigners who are above eighteen years of age are permitted to register a company in Malaysia with complete foreign ownership. Nevertheless, the Companies Act of 2016 requires a minimum of one director residing in the country.

    The company must also be in a specific sector as dictated by the Malaysian government. The government encouraged foreign investment in industries like education, banking and finance, agriculture, tourism outbound and ticketing, petroleum, oil, and gas. This article guides you through how to set up a company in Malaysia as a foreigner.

    Business Structure and Type

    Under the Company Commission of Malaysia or CCM, foreigners can register a private limited by shares company or Sendirian Berhad (Sdn Bhd) in the country. However, they cannot register a sole proprietorship or LLP companies as these entities are only meant for Malaysians.

    Name Search and Reservation

    A company needs to have a unique name and brand. A company’s name helps clients differentiate it from other companies. Foreign business owners may check whether the name they desire is available or not by filing Form 13A via MyCOID 2016 system. Every name search would cost them RM 50.

    If the name is available, they can reserve it for up to thirty days from the date of approval.

    Office Address

    Before starting a company, business owners need to determine its address, whether it is a home office or a rented office space. They can also register the company with a virtual office if it runs online.

    Company Registration

    Business owners need to prepare some documents and information before incorporating a company in Malaysia. These documents include:

  • Company’s constitution
  • A declaration from the company’s directors stating that they are not bankrupt
  • Main business activities
  • Latest residential address
  • A copy of the directors’ and shareholders’ identity card or passport
  • Details of minimum paid-up capital
  • The company should also have at least one shareholder, one resident director and one company secretary in Malaysia.

    To set up a joint venture, business owners need to submit the documents relating to the company name approval from the SSM. They must submit the company incorporation document within three months from the SSM approval. Otherwise, the company’s proposed name will be deemed void.

    The registration fee for a private limited company or Sendirian Berhad is RM 1000, whereas the registration fee for a Labuan company is between RM 1000 and RM 5000; the fees vary according to the value of the company’s share capital.

    Opening a Corporate Bank Account

    Upon successful registration and approval by the relevant authorities, business owners would need to set up a corporate bank account. They should separate their personal bank account from the company’s bank account to better track the company’s profit and expenses.

    Foreigners can open a bank account in the country using a business visa, tourist visa or working visa. They also need to register their tax ID. Use the registered corporate bank account to receive the Sales and Service Tax number. Business owners cannot commence operations before registering the Sales and Service Tax number.

    Operating License

    Once the company obtains its Sales and Service Tax number, it should apply for an operating license before starting its operations officially. However, not all companies need to apply for a license. Companies required to get a license are those in the tourism, land transportation and food and beverage industries.

    Tax Registration

    Every registered company in Malaysia needs to pay tax. The company must prepare the necessary documents for tax application. It needs to submit three forms for the application, which include:

  • Form 9 or the Certificate of Incorporation of private company
  • Form 49 to submit the details of the company’s directors, managers and secretaries
  • Form 24 to submit the information on shareholders to the Inland Revenue Board of Malaysia or LHDN
  • EPF Registration

    When hiring an employee, the company needs to register for the Employee Provident Fund or EPF. This action needs to be taken within one week of hiring the first personnel. The company will have to submit Form 49, Form KWSP 1 and copies of the directors’ identity card, the employee’s first paycheck and a copy of its Certificate of Registration.

    Getting Help From a Professional Company Incorporation Firm in Malaysia

    The process involved in the incorporation of a company in Malaysia can be taxing and intimidating, especially for foreigners. A professional company incorporation services can help streamline the process and ensure the company abides by the latest regulatory requirement. They can also advise and guide business owners through setting up a sustainable business.

    Private-Limited-Company-in-Malaysia

    One of Malaysia’s most common business structures is a limited liability company or company limited by shares. Malaysia’s limited liability company may take two primary forms: the public limited company or Berhad and the private limited company or Sendirian Berhad.

    Generally, a public limited company is selected to incorporate larger business operations, whereas medium-sized companies typically choose to register a private limited company. This article guides you through what you need to know about incorporating a private limited company in Malaysia.

    Legal Requirements for Setting Up a Company Limited by Shares in Malaysia

    The process of private limited company registration in Malaysia is done following the Companies Act’s regulations. Below are the basic requirements for incorporating a private limited company in the country:

  • The company’s trading name should include the terms Sendirian Berhad.
  • The company must have at least two shareholders (Section 14, Companies Act).
  • The company needs to appoint at least two directors (Section 122, Companies Act).
  • The company must appoint a corporate secretary who can be represented by a person that the Companies Commission of Malaysia certified. The company secretary may also be represented by a member of a professional organisation that the Minister of Domestic Trade Cooperative and Consumerism prescribed.

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    While Malaysia permits foreigners to become a shareholder, the director and corporate secretary must have a primary residence in the country, as per Section 196 of the Companies Act. The company’s director and shareholder can be the same individual, must be at least eighteen years old and not disqualified under the Companies Act 2016’s Section 298.

    When incorporating a private limited company, the business owners should prepare details on the following:

  • The company’ proposed name
  • The company’s types of business activities
  • The company’s registered office address
  • Declarations signed by the directors
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    Moreover, business owners need to prepare three kinds of payments for their company incorporation, including paid-up capital, registration fee and company secretarial fee. Fortunately, the minimum paid-up capital for incorporating a private limited company is only RM 1, and the SSM only charges RM 1010 for the registration fee. The corporate secretarial fee differs from one corporate secretarial agency to another.

    Main Benefits of Setting Up a Private Company Limited by Shares

    One key advantage of establishing a private limited company is the liability protection for the shareholders; shareholders will not be completely liable for the company’s debts. Moreover, this business structure employs an easy procedure for the transfer of shares.

    The company’s statutory documents should stipulate that the maximum numbers of members are fifty. Also, the bylaws should comprise limitations about the public’s participation in the company’s share.

    Post-Registration Requirements for a Company Limited by Shares

    After completing the registration, business owners need to purchase their Certificate of Incorporation and appoint a corporate secretary within thirty days from the date of incorporation.

    The company will also need to set up a corporate bank account for the Goods and Services Tax number registration. The following are other critical matters a private limited company needs to do after registration:

  • Register for social security at SOCSO or the Social Security Organisation.
  • Register for EPF or Employees Provident Fund within seven days of hiring the first staff.
  • Set up an Annual General Meeting or AGM. A private limited company can choose to either hold or not hold an AGM. Those that choose no to hold an AGM must circulate their financial reports and statements to their members within six months from their fiscal year-end before lodgement to the Registrar.
  • Lodgement of the annual return. As per Section 68 and Section 576 of the Companies Act 2016, the company needs to submit an annual return within thirty days from the anniversary of its incorporation date. The fee for lodging an annual return in SSM for a private company is RM 150. The Registrar may strike the company off of the registrar if it fails to lodge the annual return for three or more consecutive years.
  • Filing of tax returns. A private limited company must register with the LHDN or Inland Revenue Board of Malaysia once it commenced its operations. It has to register its income tax number and PAYE or pay-as-you-earn number through the board.
  • Getting Help from a Professional Company Registration Malaysia Services

    The process of company formation in Malaysia can be complicated and daunting, particularly for start-ups. A professional company registration Malaysia services can help streamline the incorporation process and ensure the new company adheres to relevant regulatory requirement.

    Company-Registration -in-Malaysia

    Malaysia offers various benefits to entrepreneurs and investors looking to set up a company in the country, including an attractive tax system and business-friendly policy. Moreover, its talented and experienced pool of multinational workers makes Malaysia one of the best places for any industry base investment.

    To legally run a business in Malaysia, business owners need to choose a business entity suitable for their business and register the company with the “Suruhanjaya Syarikat Malaysia” (SSM) or the Companies Commission of Malaysia. This article guides you through what you need to know about the requirements for company registration in the country of Malaysia.

    Registration Requirements For Local Companies

    Under the Companies Act of 2016, business owners can register two (2) types of local companies in Malaysia:

  • Unlimited
  • Limited by shares
  • Here are the registration requirements for these companies.

    A. Company Limited By Shares

    Companies with share capital can be registered as private or public. A private company is recognised through the words “Sendirian Berhad” (Sdn. Bhd.), while a public company is identified through the term Berhad or Bhd.

    Business owners intending to set up this type of company need to meet the following requirements:

  • Have at least one shareholder
  • Have at least one director
  • Appoint a corporate secretary who is either a person joining a professional organisation that the Minister of Domestic Trade Cooperative and Consumerism prescribes or a person authorised by the SSM
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    The company’s director and corporate secretary must have a place of residence in the country.

    The process of company incorporation includes the following:

    1. Conducting and applying a name search. There is a payment fee of RM 30 for every name applied.
    2. Lodging incorporation documents with the SSM within three months following the company name’s approval date. These documents include:
    3. The Constitution’s original copy (previously knowns as MOA)
    4. Form 48A, which include the statutory declaration by the promoter or director before appointment
    5. Form 6
    6. Additional documentation, including Form 13A’s original copy, one SSM letter’s copy approving the company name and one copy of every director’s and company secretary’s identity card

    Under Section 14 of the Companies Act 2016, a flat business registration fee Malaysia of RM 1000 is payable to SSM for every incorporation application of the company limited by share. Upon submission of duly completed incorporation documentation and registration requirement’s compliance, the SSM shall issue a registration notice.

    B. Unlimited Company

    Registration processes and required documents for incorporating unlimited companies in Malaysia are similar to that of the company limited by shares. The only difference between the two is that unlimited companies must state their members’ liability as unlimited in the Constitution, unlike the companies limited by shares.

    Registration Guidelines For Foreign Companies

    The Companies Act defined a foreign company as follows:

  • A corporation, company, association, society or other entity incorporated outside of the country
  • An unincorporated association, society or other entity, which per the regulation of its country of origin, can be sued or sue, or carry property under the secretary’s name or the name of other officers of the establishment rightfully appointed for that cause, and lack a principal place of operation or head office in the country
  • A foreign company can carry out business activities in Malaysia by registering its business through either of the following:
  • Incorporating a local company with the SSM
  • Registering the company with SSM
  • The registration procedures of a foreign company include: Application of name search, which involves Form 13A’s completion and submission to the SSM and a payment fee of RM 30. The name registered should be similar to the foreign company’s registered name in its home country
  • Lodgement of registration documentation within three months following the company name’s approval date.
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    The necessary documents for registering a foreign company in Malaysia include the following:

  • The incorporation certificate or foreign company registration certificate’s certified copy or CTC
  • A CTC of the company’s statute, charter or other means specifying its Constitution
  • Form 79
  • Form 80
  • Memorandum of Appointment or a power of attorney that authorises the individual living in the country to receive, on behalf of the foreign company, any notices given to the foreign company
  • Additional documentation, including Form 13A’s original copy and one SSM letter’s copy approving the foreign company’s name
  • Getting Help From A Professional Company Registration Service Provider in Malaysia

    The process to register a company in Malaysia can be daunting and complicated, especially for first-time entrepreneurs. A professional company incorporation agency can help to streamline the registration process and ensure the company complies with all statutory requirements.

    Incorporating company in Malaysia

    Hospitable and friendly with multiethnicity, Malaysia has successfully drawn many foreign entrepreneurs and investors into the country. In the World Bank’s 2020 Doing Business rankings, Malaysia ranked twelfth as the easiest place for doing business in the world. From a quick incorporation process to an attractive tax system, investors and business owners can benefit when incorporating a company in Malaysia. Here are seven main advantages of incorporating a company in Malaysia.

    Strategic Location and Excellent Infrastructure

    Malaysia is an economically and politically stable nation. It is strategically situated at Southeast Asia’s heart, with its capital city, Kuala Lumpur, being the central core for financial institutions. There are also several free trade zones across the country, including Bayan Lepas, Port Klang and Kulim. The country also boasts of reliable communication infrastructure and a great transportation network nationwide to support any business.

    Fast Incorporation Process

    Business owners can now incorporate their company online via the SSM’s MyCOID portal. The process will only take several days if the proposed company name is available and the information provided is approved by the Suruhanjay Syarikat Malaysia or SSM.

    When incorporating their company, business owners need to provide basic company details, such as the information of directions and shareholders, the business’ brief description, registered business address, as well as any supporting documents, such as copies of the directors’ NRIC. Foreigners may need to provide more information, including the tenancy agreement, bank statement or utility bills proving their residential address.

    Business owners can engage with company incorporation services for a hassle-free incorporation experience.

    Minimal Ownership Requirements

    The requirement for incorporating a company in Malaysia is minimal. The company only needs to have at least one director, one shareholder, and RM 1 share capital. Moreover, the director and shareholder can be of the same individual.

    Nevertheless, running a company with just RM 1 capital may not be feasible. Business owners can always increase the company’s share capital at a later date. Similarly, they can appoint more directors and shareholders to the company (with a maximum of fifty for a private limited company) later on.

    Ease of Getting Credit and Purchasing a Property

    Business owners enjoy various financial support from financial institutions, commercial banks, and even venture-capital establishments where they are willing to offer capital investments and loans for their business ventures. They can also rent or purchase properties from local Malaysia companies relatively easily.

    Low Rental, Wage and Operation Expenses

    Malaysia offers a comparatively lower rental rate for offices and premises, a competitive rate for electric and water utility prices, and a lower minimum salary obligation. These benefits allow business owners to save money on overall operational cost in the long run.

    Attractive Tax System and Multiple Government Incentives

    The corporate tax rate in Malaysia is fixed at twenty-four per cent and a maximum personal income tax rate of thirty per cent. However, SMEs with paid-up capital of lower than RM 2.5 million will be taxed with 17% corporate tax.

    Due to Malaysia’s extensive network of double taxation treaties, foreign business owners can benefit from their home country’s double taxation incentives.

    Local companies can also apply to various industry-specific tax incentives. These incentives are typically given to investments in the agricultural, manufacturing, tourism and approved services industries, research and development, environmental protection and training activities. Direct tax incentives offer total or partial relief from income tax payment for a specified time, whereas indirect tax incentives are granted in the form of exemptions from sales tax, import and excise duty.

    Moreover, the Malaysian government has implemented various grants, funding incentives and tax exemption policies to support startups, SMEs, local businesses and foreign investment.

    Skilled Workforce

    Malaysia consistently produces a strong local talent pool from its highly esteemed private and public educational institutions, accommodating a wide range of industries. It also boasts of returning talented overseas manpower. Moreover, obtaining foreign workers services in the country is fairly easy.

    Getting Help from a Professional Company Incorporation Firm in Malaysia

    The incorporation of a company in Malaysia can be intimidating and complicated, particularly for first-time entrepreneurs. Professional company registration firms help streamline the incorporation procedures and ensure the company stays compliant with the current regulations. Some services agencies also provide other outsourcing services, including human resources, accounting and corporate secretarial services.

    MY Company Incorporation

    To legally operate a business in Malaysia and obtain the protection and privilege of a registered company, business owners need to incorporate their company with the SSM or Companies Commission of Malaysia. This article lays down the general timeline and fees for company incorporation in Malaysia.

    Steps to Incorporate a Company in Malaysia, and How Long Does it Take?

    The following are the necessary steps in incorporating a company in Malaysia and its corresponding timeline.

    Name Search and Application

    During this step, business owners need to brainstorm three potential names for their company and submit them to the SSM. If the proposed name is available, they need to complete Form PNA.42 to reserve the name. Approval for name reservation from SSM typically takes about one to three working days. Business owners can also apply for the business name online.

    Preparation of Incorporations Documents

    This process usually takes about one hour or less once the business owners have the complete papers they need for company incorporation. It would be best for business owners to secure the necessary documentation before beginning the initial step of name search an application.

    The required incorporation documents include:

  • Article of Association
  • Memorandum of Association
  • Declaration of Compliance by the corporate secretary
  • Statutory Declaration by the director
  • Form 13A’s original version
  • A copy of the letter from SSM declaring the company name’s approval
  • Filing and Lodging of Documentation

    This process generally takes about three to five working days. After successfully registering the company name, business owners must submit all necessary incorporation documents within three months. Failing to do so may cause them to repeat the process of registering a new company name.

    Certificate of Incorporation’s Issuance by SSM

    This step typically takes about five to ten working days. Once business owners submit their documents to SSM, it will issue a Certificate of Issuance. The company has to create its First Board of Directors. These directors’ roles are vital since they will become the statutory forms’ signatories that will be submitted to the SSM. The statutory forms can be produced within one to two working days after the Board of Directors’ first convention.

    Business and Company Name Registration Fees

    The following are the registration fees for a new business name, business updates and information:

  • New registration: Business owners who registered their new business under a trade name need to pay RM 60 every year while those who use their name as company name have to pay RM 30 annually.
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  • Business updates: The company needs to pay RM 20. For every company branch, they need to pay RM5.
  •  

  • Business information: The company needs to pay RM 10 for business information.
  •  
    Under the Act’s section 27, the fees for application for company name reservations is RM 50. The name reservation period could be extended with a RM 50 fee for every thirty days or part thereof with a maximum of one-hundred and eighty days.

    Under the Act’s section 28, the application fee for the change of company name is RM 100. On the other hand, the application fee for the change of foreign company name is RM 250, according to section 567 of the Act.

    Company Registration Fees

    The new Companies Act 2016 requires business owners to pay a flat registration fee of RM 1,000 to SSM for every application for company incorporation.

    Foreign Company’s Registration Fees

    The fees for a foreign company’s registration depend on its share capital. The company should convert the share capital to Malaysian currency or RM at the current exchange rate first before determining the registration fees.

    Below are the foreign company’s share capital and its corresponding registration fee:

  • Not exceeding RM 1 million: RM 5,000
  • More than RM 1 million but less than RM 10 million: RM 20,000
  • More than RM 10 million but not more than RM50 million: RM 40,000
  • More than RM50 million but not More than RM100 million: rm 60,000
  • More than RM100 million: RM 70,000
  •  
    If the foreign companies do not prescribe any share capital, they need to pay a flat rate of RM 70,000 to the SSM.

    Getting Help from a Professional Company Incorporation Services provider in Malaysia

    The incorporation of companies in Malaysia can be time-consuming and daunting, especially for first-time entrepreneurs. Professional company incorporation services help business owners and investors incorporate the company smoothly while compliant with government regulations.

    Business Registration Malaysia

    To run a business legally in the country, entrepreneurs and business owners need to register a business entity with the SSM or Companies Commission of Malaysia. They can choose from the various available business structures according to their needs. Here are the types of entities common in Malaysia.

    Sole Proprietorship

    Sole Proprietorship is a simple business entity perfect for business owners (Malaysian or permanent residents) who run their business alone or on a small scale. They can register their company with their name at a small fee of RM30 or under a trading name with a registration fee of RM60.

    The registration process of sole proprietorship needs to be completed without the engagement of a third-party. Therefore, business owners need to perform every registration process personally. They have to bear all liabilities towards their business and pay taxes via their personal income tax.

    The benefits of registering a sole proprietorship include:

  • Cheaper registration
  • Easy registration process
  • Require simple compliance
  •  
    However, business owners with a sole proprietorship need to renew their registration every year. Since they need to carry every liability in their capacity, their personal income tax can be costly. This business structure is also hard to scale since the business owners cannot issue shares for investments.

    Partnership

    This business form comprises a minimum of two partners, with a limit of twenty partners. Its partners share the liabilities towards the company and have to pay taxes via their personal income taxes. If a customer sues the partnership, the partners will be liable for any damages the court awarded.

    A partnership is a popular choice amongst professionals, including accountants, lawyers, doctors and company secretaries. Similar to a sole proprietorship, it has easy registration and compliance and cheaper to register. Business owners also need to renew it annually.

    Private Limited Company

    A private limited company, also known as Sendirian Berhad or Sdn Bhd, is the most typical business entity. It is a separate legal establishment with the power to own properties, earn revenues, sign contracts, sue another entity, and sue on its name.

    Any individual intending to run an SME business in Malaysia can register for this business entity. It only requires a minimum of one director that lives in the country. The Companies Act 2016 allows business owners to register a private limited company as the company’s sole director and shareholder without having other business partners.

    Unlike sole proprietorship and partnership, business owners can scale a private limited company by increasing the paid-up capital and issuing shares to get investment. The company can also be 100% foreign-owned.

    Company Limited by Guarantee

    This business entity is a public company that does not require any shareholders and runs by the members who serve as guarantors. Although the members are not liable for contributing capital, they are obligated to pay debts if the company closes down, depending on the promised guarantee amount. Therefore, the company cannot utilise its earnings for purposes other than those declared as objectives in the constitution.

    The benefits of a company limited by guarantee or CLG includes:

  • Members are not required to contribute capital upfront
  • It can promote science, art, religion, pension and charity schemes
  • Can apply for corporate taxes exemption
  • Unlimited Company

    Business owners can register a private or public limited company. Since unlimited company or sendirian (Sdn) has unlimited liability amongst its shareholders, business owners registering this entity can form a mutual fund that carries assets for investment purposes, instead of carrying out a business. It has more flexibility than a partnership in terms of share ownership, wherein each shareholder is free to sell his or her shares back to the company.

    Nevertheless, its registration can be quite costly and difficult. It also has many stringent compliance requirements. The shareholders will still be liable for the company’s debt if it winds up within one year after leaving.

    Public Limited Company

    A public limited company or Berhad (Bhd) is a company limited by share with several distinctions from a private limited company; It can provide shares to the public without limitation to the shareholder numbers and requires a minimum of two directors. This entity is governed by the Security Commission of Malaysia and Bursa Malaysia Securities Berhad.

    Its registration process can be costly and time-consuming because of its strict compliance requirements. Nevertheless, its funding is easier to get as it is publicly listed on the market.

    Foreign Company

    Non-Malaysians who have started businesses in other nations and want to establish a company branch in the country for customer service or operation purposes can register for a foreign company. This business entity enables foreigners to operate their businesses in Malaysia without having a local director residing in the country.

    Getting Help from a Professional Malaysia Company Registration Service Provider

    Professional Malaysia company registration services help streamline the process of setting up a company in Malaysia and ensure it stays compliant with the current statutory requirements.

    register a company online

    There are almost 4.7 billion active internet users worldwide today, which account for nearly sixty per cent of the global population. Of this figure, more than ninety per cent accessed the internet through mobile devices.

    Considering the numbers of internet users online, setting up an online store would give you various benefits, including business scalability, limitless freedom of access, low overhead with high margins, and the opportunity to access the global market. You can start an online e-commerce store in Malaysia with a low budget without renting a physical store.

    Start Your Online Business in Malaysia in Just 5 Simple Steps

    Step 1: Decide your Product and its Selling Nature.

    There are various types of online business available in Malaysia. Business owners need to identify an online business type that fits the products or services they offer. Here are some of the product and services categories:

  • Digital Products: Videos, e-books, audio files, games, etc.
  • Physical Products: Cosmetics, bags, phone accessories, etc.
  • Marketing Services: SEO, web designing, portfolio website, etc.
  • Others: Business owners who sell or resell other business products on a commission basis or sell items differently should mention the category accordingly.
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    Before setting up an online business, business owners should first identify the purpose of their business setup. Moreover, preparing a robust business plan would help them start their business on the right track and increase their success chances.

    Step 2: Register the company name and business with SSM

    Business owners need to register their company or business with the Suruhanjaya Syarikat Malaysia (SSM) to legally carry out business activities. Before registering, they need to first choose a business entity.

    The following are some types of business entities in Malaysia:

  • Sole proprietorship: This is the most inexpensive and simplest form of business entity. It is owned solely by one individual since his or her liability is unlimited. Business owners can register their business under their name for RM 30 every year or register it under a trade name for RM 60 every year. Only Malaysian citizens or permanent residents are allowed to register for a sole proprietorship.
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  • Partnership: This business entity is an extended version of a sole proprietorship with more than one owner. It consists of a joint entity holder with two or more people and a maximum of twenty members. Registration starts from RM 60 every year. Like a sole proprietorship, only Malaysian citizens or permanent residents can register for the partnership.
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  • Company: Company provides a separate entity for the business. Unlike sole proprietorship and partnership, it has a more complicated Malaysia company registration process. Bestar Consulting can help business owners register a company in Malaysia correctly while compliant with the current regulatory requirements.
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    Step 3: Build an Engaging Website

    Upon successful company registration Malaysia, the next step is to build an e-commerce website to make the business go live on multiple online platforms. Business owners can begin their venture by registering the corresponding domain name and email address and getting hosting.

    A domain name is the business main web address where customers can access it, such as companyname.my. After the business is successfully registered, business owners will receive a registration number or ID. They can use it to make their website more relevant, localised and credible.

    Creating an email address that ends with the domain name, such as support@yourdomain.my, helps build credibility and trust amongst the consumers.

    Step 4: Design the Website and Manage Content

    After hosting the domain name and email address, business owners can start designing their website with appropriate theme and navigation and upload content. The activation typically takes about one to two hours.

    Business owners should build a user-friendly website with simple but precise navigation to ensure the customers can easily navigate the website and would love to visit it repeatedly. Be sure to pay attention to the website design quality since it will affect its result in SERP or Search Engine Result Page. Business owners that do not have the expertise to design their website should outsource the work to professionals.

    Another factor business owners need to take note of is the website’s content and speed. Be sure the website contents are unique, offer value and not spammy. Use keywords appropriately across the content to rank well on Google. The site should also load quickly for the best user experience. Optimising the site for SEO regularly would help the website rank better on the search engine.

    Step 5: Start Promoting

    Upon successful business registration and website creation, business owners will get an e-commerce license in Malaysia. The license will help them promote and advertise their business via regular postings, social media marketing, paid advertisement, etc.