Foreigners contact us to know about company formation in Malaysia documentary as we are an expert since 2012. Because of its resources and steady economic growth, Malaysia now attracts a huge amount of foreign investors. Malaysia has now become the central hub for starting a business in East Asia. In this article, we will discuss details on
For starting any kind of business you need some cash. So if you are a foreigner and wants to start a business in Malaysia you need to get registered your company. However, you need some required amount of capital. The table below shows the details: –
|Types of company||Condition||Amount in RM|
|100% foreign ownership||Ringgit any amount (not eligible for professional visa and export/ import business)||500,000-10,00,000|
|Joint Venture||Ringgit any amount (not eligible for professional visa and export/ import business)||350,000|
|Local||Any amount||Any amount|
Company Formation Steps
This portion of the article will guide you for completing the official forms to register a business or company. All you need to do is to follow some simple steps for completing the entire process of registration. The complete process of company registration in Malaysia are point out below:
- Complete the name search of your company at SSM website
- Complete” BORANG PNA 42” and “BORANG A” forms for completing trade name registration.
- Submit the papers and necessary documentation and forms at SSM for registration of your company.
- Complete pre-signing formalities on papers and be prepared for the service of company formation in Malaysia documentary.
However, it takes 1-2 days for approving a business name and 2-3 days might require for incorporation process and receive certified copies. However, you will be charged a decent amount for the types of business, details are shown below:
|Description of services||License||Fees|
|Company incorporation service, Opening bank account, buying forms from SSM, Secretary service 1-year||Incorporation||4000|
|Prepare supporting papers and apply for signboard and premise license||Signboard & Premise||2000|
|Prepare supporting papers and apply for export and import license||Export & Import||4000|
|Prepare supporting documents and apply for WRT license for non-residents||WRT||4000|
|Prepare supporting papers and apply for Kinder garden school license, Halal License and many more||Dagang.net||Fees vary (Contact us)|
|Add product and/ or brand name with company name permission||Notification||1000|
|Prepare supporting papers and apply for Trademark license.||Trade Mark||5000|
Opening Bank Account
Once you are done with company registration in Malaysia and receive a certificate of incorporation from SSM, now you are eligible to open a corporate bank account. According to the requirement of Malaysian bank need necessary papers mentioned below for opening a bank account.
- A normal banking requirement is to deliver them following papers: (1) All certified copies of business (business license copy) (2) Xerox copy of the passport of the company directors (3) Board Meeting Resolution (4) Office rental agreement papers (optional)
- Minimum deposit amount of amount RM 2000-5000 (Depends on Bank)
- The bank takes minimum 7 to 10 working days to verify the details before approving the account.
Local banks do not open a corporate account because of an internal policy (policy applied to foreigners and foreign directors). Foreign banks welcome the foreign investors (foreign companies) but ask some other documents, financial forecasting and minimum amount of fees for opening a bank account.
Read Also – The sales and service tax (SST) in Malaysia
Income Tax Certificate
After the company formation of the company under SSM, you need to apply for an income tax certificate. It’s suggested to apply for income tax certificate within 3 months of company incorporation. The table below shows the rate of tax for “Non-Resident Working in Malaysia”.
|Types of Income||Rate %|
|Business, trade or profession||28%|
You will not be taxable if you are working in Malaysia less than 60 days, age more than 60 years old and getting pension from Malaysian employment if you are getting interested forms banks or receiving tax-exempt bonuses.
Rent Office in Malaysia (Virtual Office)
Renting office space is necessary for company formation in Malaysia documentary. However, the virtual office in Malaysia is a smart choice for foreigners (permanent office may be too costly for small or medium-size companies). For renting a virtual office you need to pay a three-month advanced security deposit in Malaysia. A virtual office is coming at a different price depending on its size. There are lots of advantage of a virtual office in Malaysia, some of the advantages are highlighted below; Ready office (no decoration needed)
- You can use virtual office address as your office address.
- Its saves money
- You do not need to worry about utility bills (electricity, water etc.)
Once you received a certified business license from SSM, you now need to hire manpower to start your company or business. Hiring manpower is not easy tasks in Malaysia, you need to offer RM 3500 or above to hire an employee. However, there are lots of agency, who can help you out to recruit manpower with best and affordable price. Other necessary information is highlighted below: -One of the biggest job advertisement sites is jobstreet.com.my. They charge Ringgit 600-800 for each post of job advertisement.
- You need your business license copies, address and phone number them to active your business account with jobstreet.com.my.
- According to Malaysian government policy, there should be only five working days in a week i.e. Monday to Friday.
- Never forget to call the candidates on weekend (Saturday and Sunday). If you fix the interview date in office day, you have a chance of very few to be attendant.
Apply for export and import license in Malaysia
If you have sound knowledge of understanding of Malaysian license scheme for exporting and importing goods, you will have less chance of being rejected by the customs office of Malaysia. For exporting and importing or exporting any types of products you need a license (import and export license). However, to apply for an export-import license you need to be registered with “Company Commission of Malaysia”.
Once you are registered with CCM, you are now eligible to apply for an import or export license from the Ministry of International Trade and Industry (MITI). It’s complicated for the foreign-owned company to get import/ export license in Malaysia unless the majority of the shares are held by local Malaysian local (Malaysian citizen). You can export and import only halal products (some goods are prohibited).
Document requirement for export and import business are mentioned below (these are the document you need to provide to the custom):
- Commercial Invoice
- Landing bills
- List of packaging
- Certificate of export and import business (Original)
If a company have more than 50% foreign ownership, needs WRT license to participate in, franchise, retail, trading, restaurant, import and export businesses. According to the policy of “Ministry of Trade,” you must need to have office space of your company, you need to have an exact point of business activity. If you have all this, getting WRT license will not be a problem. It is good to equip your premise before applying for WRT license. Some important details of WRT license are noted below: –
- Whole sale and Retail Trade (WRT) license is required only for the foreign investors who hold majority shares of company.
- Malaysian local does not need WRT if they have more than 50% shares.
- In case of 100% foreign own company share capital have to show not less than Ringgit 1 (one) million.
Read Also – Accounting services in Malaysia
The following business category needs to apply for Halal License: (1) Distributor (2) Manufacturer/ producer (3) Repacking (4) Food premise (5) Slaughterhouse business (6) Packing material etc. The process of applying for halal license are shown in infographic below: –
SOCSO know as Social Security Organization was established back in 1971 under the ministry of HR (known as the ministry of labour). It was established for providing the social security protection for the employee/ workers of Malaysia (75 per cent will be contributed by the employer and .5% will be contributed from employees, age limitation below 60 years). The function of SOCSO are given below: – Employers and Employees Registration.
- contribution from both employers and employees.
- Payment of benefits to workers and / or dependents in the event of a tragedy.
- Providing benefits for physical and occupational rehabilitation.
- promoting awareness of safety and health at work.
In simple terms, your annual earnings will be due 18 months after your company formation in Malaysia documentary. In the case of a company which maintains, in accordance with its members, a branch register in any place outside Malaysia, the filing of an annual return must be made within two months from the annual general meeting
- All companies have to prepare an audit report and submit within the calendar year and auditor must need to be appointed at least 4-6 months before auditing of the company.
- Normally auditor claim RM 1000-2000, if any unwanted transactions are made
- Major role play by Company Secretary in Malaysia, they take responsibilities on behalf of the company.
- As law, company secretary has authority to sign on any certified copies as attested and forward for certification from SSM.
- Only license secretary and member of the chartered secretary are authorized to hold the position of company secretary.
Company Formation in Malaysia Documentary Fees
|Category||Fees in RM|
|Government fees||RM 1010|
|secretary fees||RM 1600|
So, the total cost may stand pre-registration and post-registration of Ringgit 4500-5000. 6 months’ office use is Free of charge
S & F CONSULTING FIRM LIMITED & SFM CONSULTING FIRM SDN BHD
Our documentary will help foreigners to know the process of company registration Malaysia (SDN BHD), company formation in Malaysia step and licensing of export/import to set up a business, completely. It does not mean that only register a company (SDN BHD from SSM) and start a business but some other permissions are required too. You may want to know about SME companies in Malaysia.