Before deciding to register a business entity, you should seek our advice on what type of business entity that best suits your business. You need to consider how big you expect the business to grow, and the sources of financing you expect to tap. We can help you decide which form of business entity is best for your business and assist you with all the statutory compliances requirements.
Private Limited Company (SDN BHD)
Requirements:
- Not more than 50 shareholders/members
- Minimum 1 director and shareholder
- At least 1 named director should have a principal or only place of residence within Malaysia
- Foreigner can be a sole Shareholder/ member
- Corporate body can be shareholder/ member
- Must have a registered office
- Must appoint an auditor unless qualify for audit exemption
Benefits:
- Limited liability status, limits owner liability to their shares
- Separate entity with legal status
- Can own assets under its name
- Can enjoy corporate tax benefits and is only taxed on its profit
- Can declare dividends and it is tax exempt in the hands of shareholder
- Can transfer ownership by selling its shares
- Has a perpetual/continued existence
- Easy capital funding from banks and investors
- Recognised by all statutory bodies to obtain the necessary licenses
Yearly Submissions
Need to submit to Companies Commission of Malaysia (CCM):
Annual Return
Financial Statement
Need to submit to Inland Revenue (LHDN):
Estimate Profit (CP204)
Tax Return (Form C)
Employment Return (Form E)
Limited Liability Partner (LLP)
Requirements:
- Unlimited partners with minimum 2 partners
- Partners can be individuals or body corporate
- Foreigners can register an LLP
- Must have compliance office who is Malaysian Partner, Permanent resident in Malaysia or Professional Company Secretary
- Must have a registered office
Benefits:
- Separate entity with legal status as a corporate body
- Has a perpetual/continued existence
- Tax exempt for profits paid to partners
- Accounts need not be audited
- Partners can take salary if stated in the Limited Partnership Agreement (LLPA)
- Less Stringent rule, the management of LLP is based on the LLPA and not on the LLP Act
Yearly Submissions
Need to submit to Companies Commission of Malaysia (CCM):
Annual Declaration
Need to submit to Inland Revenue (LHDN):
Estimate Profit (CP204)
Tax Return (Form C)
Employment Return (Form E)
Sole Proprietor
Business Entity Registration under Business Registration Act 1956
Requirements:
- One Owner
- Trade under name of the owner or trade name
- Must be a Malaysian or Permanent resident in Malaysia aged 18 years and above
- Business must be carried out in Malaysia
- Business renewed yearly to a maximum of 5 years
Benefits:
- Simplicity, easy to set up and cost effective
Yearly Submissions
Need to submit to Companies Commission of Malaysia (CCM):
To renew business license
Need to submit to Inland Revenue (LHDN):
Business Income (Form B)
Employment Return (Form E)
Partnership
Business Entity Registration under Business Registration Act 1956
Requirements:
- Minimum 2 and not more than 20 partners
- Must be a Malaysian or Permanent resident in Malaysia aged 18 years and above
- Trade under business name
- Business must be carried out in Malaysia
- Business renewed yearly to a maximum of 5 years
Benefits:
- Partners contribute toward the capital
- Share responsibility
- Simplicity, easy to set up and cost effective.
Yearly Submissions
Need to submit to Companies Commission of Malaysia (CCM):
To renew business license
Need to submit to Inland Revenue (LHDN):
Business Income (Form B)
Form Partnership (Form P)
Employment Return (Form E)