An unlimited company is divided into two entities namely, private, and public companies. A private company limited by shares also known as an Sdn Bhd is a popular form of business structure in the country. It has a lot of pros, such as it can be 100% foreign-owned and registered in as little as seven days.
What it is
The company exists as a separate legal identity that is allowed to buy assets, take out loans, seek contracts, sue, or be sued in its business name, etc. The maximum number of shareholders is 50. Shareholders’ liabilities are based on the amount contributed to the share capital and separate from the company. This means that if it were to fail to meet its liabilities, the creditors cannot go after the owners’ assets. It does not allow the purchase of shares by the public. Shares are not traded on the stock exchange.
Features of the Company
- Limited liability
- Foreign ownership
- Quick setup time
- Transferable shares
- Relaxed tax Liability
Setting up an Sdn Bhd
To set up a company in the nation, one would have to register the business. The registration process takes up to 10 days and requires some documents which applicants must submit to the Companies Commission of Malaysia, or Suruhanjaya Syarikat Malaysia (SSM), the body which oversees companies operating within the territory. Expats and non-residents can own 100 percent of a business incorporated here, with a minimum of RM500,000 paid-up capital. However, certain conditions determine the actual amount specific to a type of venture. Full ownership of wholesale, retail, and distributive businesses requires the Ministry of Consumerism and Trade’s approval.
Steps to Incorporation
To incorporate a company here, follow the listed steps below:
Search Business Name
Search for businesses at SSM to ascertain if your desired company name is available. Every business must have a unique name peculiar to it.
Company registration
Register the business with the Companies Commission of Malaysia (SSM) by filing an application and submitting all required documents.
Open a corporate bank account
All corporations must open a corporate bank account with any local or international banks based here.
Obtain permits and licenses
Not all businesses require a permit or license to carry out business activities. However, depending on the nature of services offered and products sold, one might have to apply for either a permit or license.
Tax obligations
Corporate tax registration is necessary. To register a company for taxes, fill and submit Form CP 600C with the Inland Revenue Board of the country.
Annual filing
All companies conducting business here must file annual tax returns with audited accounts to the Inland Revenue Board after every tax year.
Registration Fees
SSM usually charges a fee of 1,000 ringgit (US$238) for registering a company. However, this is determined by the nominal share capital of such a business.
| Nominal share capital | Fees |
| Up to 1 million ringgit | 5,000 ringgit |
| Above 1 million ringgit but not more than 10 million | 20,000 ringgit |
| Above 10 million but not more than 50 million ringgit | 40,000 ringgit |
| Above 50 million ringgit but not more than 100 million ringgit | 60,000 ringgit |
| 100 million ringgit | 70,000 ringgit |
The fee is a flat rate of 1,000 ringgit if the business owner does not specify a share capital.
Requirements for Registration
- Unique business name
- Has at least one shareholder
- Resident director
- Company Secretary
- Registered Address
- Have a minimum share capital of RM1,000 (locally owned companies or RM500,000 for foreign-owned)
Filing of Incorporation Documents to SSM
All incorporation documents required must carry the approved company name and be submitted to SSM within 30 days after the day of lodgment for the application of name search.
