Malaysia
Malaysia, is a country located in Southeast Asia.
The country is divided into two parts, West Malaysia is located on the Malay Peninsula and East Malaysia is located in northern Borneo, separated by the South China Sea.
he capital, Kuala Lumpur, is located on the west coast of the peninsula, and the neighboring city of Putrajaya is the seat of the federal government. The country has a population of over 31.7 million people. Malaysia is also a multicultural and ethnically diverse country, with the Malays being the largest ethnic group, followed by the Chinese, Indians and the indigenous East Malaysians, comprising more than 30 ethnic groups, with freedom of religion and multilingualism.
The official language of Malaysia is Bahasa Malaysia. Malaysian Chinese mostly speak Chinese dialects from the southern provinces of China, the more common ones include Chinese, Minnan (Hokkien) (the most spoken dialect by Chinese in Malaysia, with about 40% of the Chinese community in Malaysia originating from Fujian), Hakka (the second most spoken dialect by Chinese in Malaysia), Cantonese (the third most spoken dialect by Chinese in Malaysia), Hainanese (belonging to the Min dialect family), Teochew ( (which belongs to the Min dialect) and Fuzhou (which belongs to the Min dialect).
On the diplomatic front, Malaysia, which joined the United Nations on 17 September 1957, is a founding member of the Association of Southeast Asian Nations (ASEAN) and a member of the Indian Ocean Rim Association for Regional Cooperation (IOR-ARC), the Asia-Pacific Economic Cooperation (APEC), the Commonwealth of Nations (CFR), the Non-Aligned Movement (NAM) and the Organization of the Islamic Conference (OIC), and is involved in military operations such as the Joint Defence of the Five Nations (JD-5) and United Nations peacekeeping operations.
QUESTION & ANSWER
Frequently asked questions about registering a Malaysian company
Frequently asked questions about registering a Malaysian company
What are the requirements to set up a company in Malaysia?
The company requires at least one company director who meets the following criteria :
：Principal residence in Malaysia (either a Malaysian or a foreigner)
：18 years or older
：not in insolvency
：No serious crime in the last five years
- How long does it take to set up a company?
：It takes 15 to 20 working days to set up a company. - What are the steps to set up a company in Malaysia?
There are three main steps in setting up a company in Malaysia.
Step 1：
Apply to the Registrar of Companies for the required company name. This step usually takes a few hours to two working days. The Registrar of Companies will have the following response:
a）Agree - the company name can be used, proceed to Step 2
b）Doubt - CR needs additional documents to approve the company name. Once we submit the additional documents, CR will take two to three working days to process the application.
c）Refusal - This means that the company name is not available and another name should be suggested for company registration.
Step 2：
Once the company name is approved by the Registrar of Companies, we will prepare the relevant documents to be signed by the shareholders and directors of the company in Johor, Malaysia. This step can be completed within a few hours to a few days, depending on our meetings with the shareholders and directors of the company.The incorporation fee must be paid in full to proceed to the next stage.
Step 3：Once all the relevant documents have been signed, we will submit them to the relevant authorities. Usually the Registrar of Companies will issue the Certificate of Incorporation (Form 9) within one to five working days. This indicates that the company has been successfully registered. - Can a non-Malaysian citizen register a company without the assistance of a Malaysian citizen?
：Is it possible for a non-Malaysian citizen to hold 100 per cent of the shares in a Malaysian company?
：Non-Malaysian citizens are allowed to hold 100% of the shares of a Malaysian company and there is no restriction on the distribution of shares and no mandatory requirement for Malaysian citizens to be on the board of directors.
：Their primary residence address must be in Malaysia (can be a non-Malaysian citizen). - Can I set up my own limited company?
：The Companies Act 1965 requires every company to have at least one company secretary under Section 139 of the Companies Act 1965. Therefore, you must be a qualified company secretary to set up your own limited company.
Foreign Capital Joint Venture
Joint ventures between foreign and local companies to enter the Malaysian market is a very common form of partnership. Joint venture contracts are generally governed by Malaysian law because the majority of the joint venture projects are carried out in Malaysia. Malaysian law is derived from the English legal system and is therefore fundamentally different from the laws of China and Taiwan. It is therefore important for foreign investors to obtain adequate Malaysian legal advice before entering into any legal contracts. The more common form of joint venture is for the two partners to form a joint company and determine the shareholding of each party based on their contribution and agreement. Once the shares are decided upon, it is advisable to legalize them, form the company immediately and distribute the shares to the parties in accordance with the agreement.
What a Malaysian company needs to know at the start of its operations.
Once a foreign investor has established a company in Malaysia and has a Malaysian bank account and business office, the next step is to proceed with the following:
-
Hiring staff
Under Malaysian law, all employers are required to contribute to the Employee Provident Fund (EPF) as well as the Social Insurance Scheme (SOCSO) for their employees. The minimum contribution to the Employee Provident Fund is 20% of the employee's monthly salary, of which 8% can be deducted from the employee's monthly salary and the remaining 12% must be contributed by the employer. Contributions are due by the 15th of each month. The monthly social insurance premium is not high and is determined by the employee's monthly salary, with the maximum monthly premium not exceeding RM88.80. If the company needs to employ foreign professionals and requires a work permit for a period of stay of one to two years, the company must have a Paid-Up Capital of RM500,000 (US$125,000) or more. Foreign companies with Paid-Up Capital of RM500,000 (US$125,000) are able to apply to the Immigration Department to bring in foreign professionals. The Immigration Department can directly approve at least 5 work permits for companies with capital between USD 200,000 and USD 2,000,000. For foreign companies with a paid-up capital of US$2 million and above, they are entitled to 10 Work Permits for foreign professionals approved by Excelsior.
-
Relevant business licenses and service tax licenses
Different industries have different licensing rules, but not all industries and companies require a business licence. If the business is a service business, then you need to apply to the Customs and Excise Department for a license to collect service tax. With a licence, a 6% service tax can be collected from the customer or the consumer.
-
Application for relevant tax exemptions
(b) Investment incentives. Malaysia's direct tax incentives provide full or partial income tax relief for a specified period of time, while indirect incentives are exemptions from import, sales and domestic taxes. Multimedia, Software and Information Industry: Investors are able to apply for "Multimedia Corridor Status". Once approved, they are exempt from 100 per cent tax for a minimum of five years.
-
Manufacturing sector.
The main incentives given to companies investing in the manufacturing sector in Malaysia are Emerging Industrial Status (EIS) and Investment Tax Credits (ITC). A company with standard Emerging Industrial Status (EIS) is entitled to a partial tax exemption for 5 years, where the company is taxed on 30% of its statutory income for a period starting from the "production date" (the "production date" being the day on which the company's production level reaches 30% of its maximum capacity). An alternative option to the emerging industry status is the investment tax credit (I-TA). A company with a standard ITA is entitled to a 60% deduction on qualifying capital expenditure (e.g. plant, machinery or other equipment) for a period of five years from the date on which the first qualifying capital expenditure is made. The company may use this credit to offset 70% of statutory income for each taxable year. Unused deductions can be carried forward to subsequent years until they are exhausted. The remaining 30% of the statutory income will be taxed at the current rate.
-
In agriculture
The main incentive for agriculture is a partial tax exemption of 30% of the statutory income of agricultural products or companies engaged in agricultural activities that affect the production of new industries, for a period of five years, starting from the "production day" ("production day" is the day when the production level reaches (30% of maximum capacity on the day). Companies in both categories may apply for an Investment Tax Credit as an alternative to Emerging Industry status. Companies approved for this incentive will receive a 60% deduction on qualifying capital expenditures for a period of 5 years from the date of introduction of the first qualifying capital expenditure. The company may use this credit to offset 70% of its statutory income for each taxable year. Any unused credit can be carried forward to subsequent years until it is exhausted. The remaining 30% of the statutory income will be taxed at the current rate.
Incentives are also available for investments in tourism, environmental management, research and development, training, information and communication technology, approved services projects, shipping and transport.
Under the Business Registration Act, any person or company that is in operation for 30 consecutive days, whether through traditional channels or not, with or without a physical presence, even if it is an online business, is required to register their business with the Companies Commission.
Companies Commission of Malaysia (SSM) Registration Types:：
- Individual business (Sole Proprietorship, individual name or business name registration).
- Joint ventures (partnership, trade name registration)
- Joint stock companies
A company with a share capital may become.
- Private company (company name followed by the words "Sendirian Berhad" or "Sdn. Bhd.")
- Listed company (company name followed by `Berhad' or `Bhd')
Malaysia company registration process
Step 1
Fill out the power of attorney, sign the agreement and make the payment.
Step 2
Submit a company name search request, a name search must be conducted - to determine if the proposed company name is available.
Step 3
Submit the company registration documents to SSM within 3 months from the date of approval of the company name by SSM, otherwise a new application for company name search is required.
Step 4
Open the company bank account in person in Malaysia.
Malaysia company registration documents
- English names of Malaysian companies
Must be composed of English name or other letters (but be sure to explain each letter in detail), currently does not accept Chinese name registration. - The main business activities of the company
(You can choose up to 3 business items). - Photocopies of ID cards or passports of all company directors and shareholders.
(Owner must be 18 years of age or older). - up-to-date certified residential addresses, business occupations, emails and contact numbers of all company directors and shareholders.
- Registered capital and distribution of shares
(minimum RM 1, no maximum)
Malaysian companies are required to pay up the registered capital (special license has a specified registered capital), and a certain administrative fee will be levied for reaching a certain capital. - Business Secretary
A business secretary must be appointed.
Daily life services
- Counselling services for daily life
- Daily Chinese, English, Malaysian and translation services
- Accompanying interpreter
(e.g., business escort, banking, consular services, hospital services) - Contractual agreements, translation of documents
(Chinese, English, Bahasa Melayu) - Emergency assistance