Your Ultimate Guide to Company Registration in Malaysia

Embarking on the journey for your company registration in Malaysia is undeniably thrilling; however, it comes with its unique set of challenges and procedures. To make your entrepreneurial dreams a reality in Malaysia, start by registering your company with Suruhanjaya Syarikat Malaysia (SSM), the country’s official Companies Commission. The SSM holds a pivotal role in the integration of businesses, overseeing the registration of companies, and providing vital company and business-related information to the public.

 

In this comprehensive guide, we will expertly walk you through the essential three steps for your company registration in Malaysia.

 

TL;DR: Company Registration in Malaysia Made Simple!

Thinking of launching a business in Malaysia? Here’s a quick rundown! ✅ Choose your business structure, pick a unique company name, and appoint key officers. ✅ Register your company with Suruhanjaya Syarikat Malaysia (SSM) by submitting essential documents. ✅ After registration, open a corporate bank account, secure business licenses, understand tax obligations, and appoint an auditor.

With the right steps, company registration in Malaysia is easier than you think! Ready to start your entrepreneurial journey? 🚀

Step 1: Preparation for Company Registration in Malaysia

Registering a company consists of deciding on the basic requirements. Firstly, this involves choosing the suitable business structure for your desired company. Secondly, it includes selecting a company name. Finally, it encompasses deciding and appointing qualified officers, a registered office, and meeting capital requirements.

 

In this guide, we will guide you through the preparation steps for your company registration in Malaysia.

A. Choosing a Business Structure as Part of Your Company Registration in Malaysia

First and foremost, when establishing a company in Malaysia, your initial step is to choose a suitable business entity. In other words, you need to decide what type of company you want to set up. This decision marks the foundation of your business venture, shaping its structure and legal framework. Therefore, you should do research on each entity to decide which entity matches your goals and objectives the most.

 

Types of Malaysian business entities include:

1. Sole proprietorship

2. Partnership

3. Limited liability partnership

4. Private limited company

5. Public limited company

6. Branch office

7. Representative office

8. Subsidiary company

 

B. Choose a Company Name – Crafting a Distinctive Business Name in Malaysia

Once you have chosen a suitable business entity, the next thing to do is to select a company name. Subsequently, after you have decided on a name, you should run a name check with the Companies Commission of Malaysia (SSM). Following the name check, proceed to register the name with the SSM. Upon approval, your company will have the name reserved.

 

Characteristics of Malaysian company names according to the guidelines on company names are:

• The name shall use correct spelling and language.
• If the name has words that are not in Malay or English, the meaning of the words must be given.
• They allow the use of a mix of Bahasa Malaysia and English to describe the type of business, provided it follows proper grammar.
• Names that are not blasphemous or likely to be offensive to members of the public.
• Names do not resemble elements of religion.
• Refrain from using names that are too general, such as Technology Sdn. Bhd or International Sdn. Bhd.
• Only the specified directors listed on the application form for incorporation can use their names as the company names.
• They must provide the meaning of created or coined words used in the company name.
• The company’s name can include a maximum of five symbols; they do not allow any more.
• & (including dan, and and N)
• . (dot symbol)
• – (hyphen symbol)
• ( ) (bracket symbol)
• ‘ (apostrophe symbol)
• The name should not be an acronym that can cause confusion with other associated names.
• Names of institutions for higher learning
• Name stands for federal government agencies or state and government-owned companies

 

C. Decide on Officers and Shares of Your Company – Structuring Leadership and Ownership

Directors

• Minimum: One Director
• Maximum: Unlimited
• Must be a natural person
• Aged 18 years and above

 

Shareholders

• Minimum: one shareholder
• Maximum: unlimited (limited to 50 for private limited company)
• Can be an individual or body corporate
• Individuals aged 18 years and above must comply with this requirement.

 

Company Secretary

• Minimum of one company secretary who is a member of any professional body or licensed by the SSM.

 

Registered address

• Having a registered office address to receive formal communication and documents from the government is mandatory. P.O. boxes are not permissible for this purpose.

 

Share capital

• Minimum: RM 1
• Maximum: Unlimited

 

Step 2: Company Registration in Malaysia

Once you have completed the preparation stage, the next step will be registering your company with the related authorities in Malaysia.

 

This step will walk you through what you need to do to register your company and what documents you will need.

 

A. Registering Your Company

Registering the company name with the SSM is a mandatory step. Upon approval, the name will be reserved for 30 days from the day of confirmation. Additionally, you can extend it for another 30 days by paying a fee of RM 50.00.

 

The documents needed for your company registration in Malaysia:

• Constitution (optional)
• Declaration by a director or promoter before an appointment
• Declaration of compliance
• Copy of the identity card of every director

 

Step 3: Post- Registration

The final step involves the requirements and obligations you must satisfy after you have successfully completed your company registration in Malaysia with the SSM.

 

At this stage, we will mainly focus on opening the business bank account, learning which business licenses you will need, registering for the provident fund, appointing auditors, and determining your tax liabilities.

 

A. Opening a Corporate Bank Account – Simplifying the Process

When you have completed your company registration in Malaysia, you can open a corporate bank account. We recommend researching for a suitable bank as different banks provide different benefits and fees. Moreover, you can choose from numerous local and international banks.

 

To open a corporate bank account as part of your company registration in Malaysia, you need to provide the following documents:

• Completed application forms from the bank
• Letter of introduction and recommendation from an existing customer of the bank (some banks require this, some do not)
• Incorporated company’s rubber stamp
• Photocopy of directors’ and authorized signatory’s identification cards
• Certified true copy by the company secretary of:
• Resolution from the board of directors to open an account and the list of authorized signatories
• All company incorporation forms

 

B. Obtain Business Licenses and Permits – Navigating the Regulatory Landscape: Essential Licenses and Permits for Your Business in Malaysia

Companies in Malaysia must actively register for licenses and permits relevant to their nature of business.

 

There are three types of business licenses:

1. General licenses
2. Sector/industry-specific licenses
3. Activity specific licenses

 

General licenses are the necessary licenses you need when you establish a business in Malaysia. The licenses include:

• Company registration in Malaysia
• Company and employee’s income tax registration
• Employees provident fund (EPF)
• Social Security Organization (PERKESO)
• Human resources development fund
• Business premise licenses and signboard licenses

 

The Malaysian government specifies sector/industry-specific licenses, which businesses in particular industries or sectors must actively obtain.

• Manufacturing sector licenses are mandatory for operation.
• Licenses are essential in the wholesale and retail trade industry.
• Businesses in the telecommunication sector must obtain specific licenses.
• Businesses in the broadcasting sector must obtain licenses for their operations.
• The oil exploration sector mandates specific licenses.
• Construction sector businesses need appropriate licenses to operate.
• Banking sector operations require specific licenses.
• Department BLESS, Ministry of Entrepreneur Development (MED) issues relevant licenses.
• The Department of Occupational Safety and Health Malaysia (DOSH) mandates licenses for certain businesses.
• National Water Services Commission (SPAN) issues licenses related to water services.

 

Businesses can apply for activity-specific licenses that actively regulate particular activities, which are applicable across multiple industries or sectors. This license includes:

• Certificate of fitness for certified machinery
• Approval of expatriate posts
• Approval to install, resite, or alter air pollution control equipment
• Building plan approval
• Sales tax approval

 

C. Determine Your Tax Obligations – Mastering Malaysian Taxation for Businesses

Your tax obligations will be different based on the scope of charge, exemption, deductions, and more. Furthermore, Malaysia does not charge tax on international sales, except for banks, insurance companies, airlines, and shipping companies. Additionally, the current corporate tax rate for both Malaysian residents and non-residents stands at 24%.

 

Moreover, the government imposes a personal income tax rate of 28% on residents with taxable income exceeding RM 1 million, while non-residents face a slightly higher rate of 30%. These distinctions are vital for understanding the Malaysian taxation system.

 

D. Appoint Auditors – Ensuring Financial Compliance and Transparency

Every company must appoint an auditor before the first annual general meeting. However, for private limited companies, annual general meetings are not mandatory. In the case of newly incorporated companies, the board of directors shall appoint the first auditor at least 30 days before the end of the period for the submission of the first financial statements. This ensures a timely and organized process for financial compliance and reporting.

 

E. Registering the Employee Provident Fund – Efficient Employee Registration Protocols

 

Registration for Employers

Private sector employers, encompassing SSM-registered Sdn Bhd, SSM-registered businesses, government-linked companies, government-linked investment companies, and Bank Negara-approved banks, must proactively provide the necessary documents.

 

Therefore, this requirement ensures that employers promptly and efficiently register employees within seven days from the day they are employed, adhering to the specified timeframe.

• Form KWSP 1
• Form 49
• Copy of certification of company/business registration from SSM, or
• Section 14 pertains to the application process for registering a company.
• In Section 15, guidelines regarding the notice of registration are outlined.
• Section 17 provides details about the issuance of the certificate of incorporation for private companies.
• Copy of the sole proprietor/partner/director’s identification (MyKad or passport)

 

Company Registration in Malaysia for Employees

Employers must actively register employees before making the first contribution. To accomplish this, there are four ways you can register your employees.

 

1) Employee registration via i-Akuan

• Employees who have i-Akuan accounts can register their employees online.
• Only Malaysian citizens and permanent residents who have 7- and 12-digit identification cards can apply through this method.

 

2) Auto register via monthly contribution form (Form A)

• Upon completing form A, integrating details like the MyKad number and employee’s name, employees are effortlessly and automatically registered with the EPF.
• Only applies to Malaysian citizens and permanent residents with MyKad.

 

3) Forms

• Malaysian and permanent residents:
• MyKad
• Form KWSP 3 (if required)
• Non-Malaysian residents
• Passport or valid work permit or visa
• Form KWSP 16B
• Form KWSP 3

 

4) Employee with MyKad

• Employee must be present at the EPF counter and need to give their MyKad and registration will be processed using the MyKad chip.

 

Conclusion

Registering your company in Malaysia is a rewarding journey for entrepreneurs. The country’s dynamic economy offers excellent growth opportunities. Supportive government policies further enhance the business environment. Malaysia’s diverse market attracts both local and international investors.