Malaysia's economy has flourished in recent decades, and the country has emerged as a rising market for high-end goods. Tax advantages, a well-developed finance sector, and well-maintained land, sea, and air connections promote its innovation-driven economy.
How Much Does It Cost to Incorporate a Company in Malaysia?
Registration Fees
The cost for registering a business with the SSM is a flat rate of 1,000 ringgit (US$238), although the fee is determined by the nominal share capital.
| Registration Fees for Private Limit Companies in Malaysia | |
| Nominal share capital | Fees |
| Up to 1 million ringgit (US$238,380) | 5,000 ringgit (US$1,191) |
| Exceeding 1 million ringgit (US$238,380) but not more than 10 million (US$2.38 million) | 20,000 ringgit (US$4,767) |
| Exceeding 10 million (US$2.38 million) but not more than 50 million ringgit (US$11.9 million) | 40,000 ringgit (US$9,535) |
| Exceeding 50 million ringgit (US$11.9 million) but not more than 100 million ringgit (US$23.8 million) | 60,000 ringgit (US$14,302) |
| Exceeding 100 million ringgit (US$23.8 million) | 70,000 ringgit (US$16,686) |
The registration fee is charged at a flat rate of 1,000 ringgit (US$238) if the foreign company does not require any share capital.
Paid-up Capital
Incorporating a company in Malaysia requires no paid-up capital. However, if the company wants to issue work permits for foreign employees, a 100% foreign-owned company must commit to a minimum paid-up capital, the amount of which is decided as follows:
- Advisory and consultancy businesses – 500,000 ringgit (US$119,000)
- Import, export, trading, and restaurant businesses – 1 million ringgit (US$238,380)
- Joint venture with a Malaysian partner (with at least 50% shares) – 350,000 ringgit (US$83,433) in paid-up capital and 500,000 ringgit (US$119,190)
- Non-export-oriented industries – 100,000 ringgit (US$23,838) and with total minimum sales of 2 million ringgit (US$476,460).
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Minimum Requirement to Register a Company in Malaysia
- A minimum of 2 subscribers
- A minimum of 2 directors
- A company secretary
- An individual who is a member of a professional body prescribed by the Minister of Domestic Trade Cooperative and Consumerism
- An individual who has been given a license by the Companies Commission of Malaysia
- The proposed director and company secretary in a Malaysian company shall have their principal or only place of residence within Malaysia.
However, foreigners can choose between manufacturing and non-manufacturing companies when incorporating a company in Malaysia, subject to the following conditions:
Manufacturing Company:
- Minimum 1 local director with 10-30% shares will be required
- Multiple business licenses are required.
Non-Manufacturing Company:
- Allowed for purely foreigner directors and shareholders (minimum 1 director).
Types of Company Incorporation in Malaysia
The following are the services offered in regard to business incorporation in Malaysia:
- Private limited company (Sendirian Berhad)
- Sdn. Bhd. corporate secretarial services
- Public limited company (Berhad)
- Foreign company representative office
- Sole proprietorship
- Partnership
- Limited liability partnership
- Corporate bank account opening
- Drafting of the company constitution
- LLP compliance officer services
- Nominee shareholder & director services
- Share-based payments & employee share options (ESOS) advisory
- Foundation (Yayasan)
- Shareholding advisory.
Documents Required for Company Incorporation in Malaysia
The following documents are required to form a company in Malaysia:
- Desired business name
- Business objectives
- Registered company address
- Directors and shareholders’ contact information
Note: Our experts will assist you with any further requirements.
How to Incorporate a Company in Malaysia
The following steps are involved in forming a company in Malaysia:
- We will fill out the application form on your behalf
- A name search will be conducted by us with the Malaysian Companies Commission (SSM)
- Once the company name has been approved, you must sign the documents
- The documents will be provided to SSM once your company is ready
- SSM will then provide you with a certificate of incorporation, and your company will be ready to go.
Conclusion
It’s important to choose the right business structure when starting a company in Malaysia. Thousands of businesses, like yours, have chosen Vakilsearch to open a new market in Malaysia. We will provide you with the best company registration experience a foreign company could hope for in Malaysia. We believe in making things easier for small businesses so they can focus on growing their company rather than being overburdened with administrative tasks. Everything is handled for you by our experts in a fast and effective manner.
FAQs
Can foreigners own companies in Malaysia?
Yes, foreign ownership is possible, but with some limitations. You can typically own 100% of the company, but specific industries like agriculture, banking, and education might require a 50% Malaysian ownership stake.
What's the easiest business to start in Malaysia?
There isn't a single easiest option, as it depends on your skills, experience, and market demand. However, some businesses considered relatively easier to start include online businesses (e-commerce, digital marketing, freelance services), small service businesses (catering, cleaning, repairs, personal services), and retail shops catering to niche products or local needs.
How much does it cost to start a business in Malaysia for foreigners?
The cost varies depending on factors like business type, location, and registration fees. It can range from a few thousand Ringgit (MYR) to tens of thousands, depending on your specific setup.
What's the best business to start?
The best business is subjective and depends on individual skills, market research, and personal interests. However, some sectors with potential include tourism and hospitality, e-commerce (due to the growing online retail market), and technology and innovation (as Malaysia promotes technological development).
Finding the fastest-growing company in Malaysia?
Identifying the absolute fastest growing company can be challenging due to changing data. It's recommended to research specific sectors and consult reliable business publications for up-to-date information.
How to get funding for your startup?
Several options exist, including bootstrapping (using personal funds), seeking angel investors (individuals investing in early-stage businesses), approaching venture capitalists (firms investing in high-growth potential companies), or exploring government grants and loans offered to support specific sectors or entrepreneurs.
What's the startup success rate in Malaysia?
Statistics on startup success rates can vary depending on the source and methodology used. It's crucial to conduct your research and seek guidance from professionals for accurate information tailored to your specific situation.
Do freelancers pay tax in Malaysia?
Yes, freelancers in Malaysia are generally considered self-employed and are responsible for paying income tax on their earnings. They need to register with the Inland Revenue Board of Malaysia (LHDN) and file their tax returns.
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