Company Formation in Malaysia
Last updated: November 2026
Malaysia company registration runs through the Companies Commission of Malaysia (SSM), which has taken incorporations in its new Corporate Registry System (CRS) on SSM4U since 14 July 2026. The usual vehicle is the Sendirian Berhad (Sdn Bhd), the Malaysian private limited company, comparable to an LLC. One shareholder and one director are enough, and the Companies Act 2016 sets no minimum capital. Corporate income tax is 24%.
We register Malaysian companies for foreign founders. We help you choose between a Sdn Bhd, a branch and a Labuan company, check the licences and prepare the filing a qualified company secretary usually lodges. Then we handle beneficial ownership, the tax number, Expatriate Services Division (ESD) registration and the bank introduction. Each case is quoted once we know the activity and the hiring plan.
| Quick facts | Value |
|---|---|
| Local company form | Sdn Bhd (Sendirian Berhad, private company limited by shares), equivalent of an LLC / private limited company |
| Registry and portal | SSM, Corporate Registry System (CRS) on SSM4U since 14 July 2026 |
| Shareholders | One to 50; individuals or companies |
| Directors | At least one natural person, 18 or over, with a principal place of residence in Malaysia |
| Company secretary | Within 30 days; citizen or permanent resident living in Malaysia |
| Minimum share capital | None; shares have no par value |
| Paid-up capital to hire expatriates | RM500,000 if 100% foreign-owned; RM1,000,000 in foreign-owned wholesale, retail or trade |
| Foreign ownership | No equity conditions in the Companies Act 2016; distributive trade restricted |
| Incorporation | 1 working day (SSM client charter) |
| Corporate income tax | 24%; SME rates of 15% and 17% only at 20% foreign ownership or less |
| E-invoicing | Mandatory; exempt below RM3,000,000 annual turnover |
Why Form a Company in Malaysia
Full foreign ownership is the default. Outside distributive trade and other regulated sectors, a foreign founder can hold every share of a Sdn Bhd. Since June 2003, new manufacturing projects and expansion or diversification projects may be 100% foreign-owned.
Incorporation is fast. CRS handles name search, incorporation and later lodgements, and SSM's client charter allows one working day for an incorporation.
Profits come out cleanly. Dividends are single-tier, with no withholding tax, and foreign shareholders may repatriate profits in foreign currency.
The trade-offs are real. One director must live in Malaysia, the secretary must be a citizen or permanent resident, and a company more than 20% foreign-owned loses the SME tax rates.
Comparing Malaysia with Singapore, Hong Kong, Thailand or Indonesia? Start with the resident director rule, the paid-up capital behind work passes and the retail caps.
Company Types Available in Malaysia
Section 10 of the Companies Act 2016 lets a company limit liability by shares or by guarantee, or leave it unlimited.
Sendirian Berhad (Sdn Bhd): Private Company Limited by Shares
The standard vehicle: up to 50 shareholders (s.42(1)), restricted share transfers (s.42(2)) and no public offers of shares or debentures (s.43). Directors must be natural persons aged 18 or over (s.196(2)), so a parent company cannot sit on the board. The secretary must be a citizen or permanent resident living in Malaysia, licensed by SSM or a member of a Fourth Schedule body (s.235). A constitution is optional, and no minimum capital applies: compare our minimum share capital by country table.
What does Sdn Bhd mean?
Sdn Bhd is short for Sendirian Berhad, Malay for "private limited": Sendirian means private and Berhad means limited. The suffix marks a private company limited by shares under the Companies Act 2016, the standard Malaysian vehicle and the local equivalent of an LLC or private limited company. Section 597 restricts who may use both words.
Berhad (Bhd): Public Company
A Berhad is a public company with at least two directors (s.196(1)(b)), both subject to the residence rule. Companies limited by guarantee are always public (s.11(2)).
Limited Liability Partnership (PLT)
A Perkongsian Liabiliti Terhad (PLT) under the Limited Liability Partnerships Act 2012 needs two or more partners (s.6). At least one compliance officer must be a citizen or permanent resident ordinarily resident in Malaysia (s.27(1)). The LLP Act sets no restriction on foreign partners, the Minister of Domestic Trade told the Dewan Negara in March 2026.
Registered Foreign Company (Branch)
A foreign company must register with SSM before carrying on business in Malaysia (s.561(1)), appoint a resident agent (s.563) and follow the beneficial ownership rules (s.573A).
Foreign Ownership Rules in Malaysia
Ownership limits come from sector policy, not company law. The MIDA equity policy confirms that the Companies Act 2016 imposes no equity conditions; sector ministries and agencies may attach them to approvals, licences and permits. Our foreign ownership and director requirements by country table compares jurisdictions.
Distributive trade is the main exception. KPDN's 2020 guidelines (DP2020) and MIDA's distributive trade booklet set these rules:
- Closed: supermarkets and mini-markets under 3,000 sq m, provision shops, news agents, medical halls and fuel stations with convenience stores. Permanent wet market and pavement stores, textiles, non-exclusive restaurants, bistros and jewellery shops are closed too.
- Convenience stores: foreign equity capped at 30%, with at least 30% held by Bumiputera or Malay shareholders.
- Hypermarkets: at least 30% Bumiputera equity.
- Every distributive trade company with foreign equity: Bumiputera director or directors, and annual financial reports to KPDN.
- Capital: DP2020 looks for RM1 million in shareholders' funds (paid-up capital plus reserves) for specialty stores and other formats, e-commerce included. It is a guideline figure, not a statutory minimum.
KPDN is revising the guidelines. Proposals for an RM1 million paid-up threshold and 51% local ownership in "sensitive sectors" are not current law, the Minister told Parliament in March 2026.
Can a foreigner register a company in Malaysia?
Yes, and own all of it, unless a sector rule limits the activity. The board still needs one director with a principal place of residence in Malaysia, and the secretary must be a citizen or permanent resident. Sole proprietorships and partnerships under the Registration of Businesses Act 1956 are reserved for citizens and permanent residents.
How to Register a Company in Malaysia: Step by Step
As your formation agent, we prepare every document below, and the person lodging, usually the company secretary, files it with SSM, whose Registrar of Companies keeps the company register. Filings run through the SSM Corporate Registry System on SSM4U, which replaced MyCoID on 14 July 2026.
- Open a CRS account. The person lodging, usually the secretary, verifies identity at an SSM counter or tap.it kiosk.
- Reserve the name (s.27). A reservation lasts 30 days, extendable to 150 days in total. Under P.U.(B) 439/2026 of 20 August 2026, SSM refuses names with royal or government links and words such as Bank, Insurans, Institut, Bumiputera and Universiti.
- Lodge the Super Form (s.14). It lists the name, nature of business, registered office, members, directors with their principal place of residence, the secretary and the shares, with each director's consent (s.201).
- Registration (s.15). SSM assigns the registration number and issues a notice of registration; a certificate of incorporation is issued only on application (s.17).
- First 30 days. The secretary is appointed within 30 days (s.236(2)), and director and secretary particulars reach SSM within 14 days (s.58).
- Beneficial ownership. Beneficial owners are lodged through e-BOS within 60 days of the secretary's appointment.
- Tax number. A company registered online with SSM receives its tax identification number (C prefix) automatically.
What is SSM registration?
SSM registration is the everyday name for registering with the Companies Commission of Malaysia. For a Sdn Bhd it means incorporation under the Companies Act 2016, filed in CRS on SSM4U, after which SSM issues a notice of registration with the company number.
Required Documents for Malaysia Company Registration
The Super Form is only as good as the documents behind it:
- Passport (non-citizens) and residential address of every shareholder and director (s.14(3)(e), (f))
- Each director's consent and declaration of no disqualification (s.201)
- A consent document from any corporate shareholder
- Certified translations of documents not in Malay or English (s.586)
- A registered office in Malaysia, open to the public during ordinary business hours (s.46)
- Sector approvals SSM asks for, such as local council approval for licensed money lending
We check every item before lodgement.
Timeline and What Our Package Covers
| Stage | Statutory or official timeline |
|---|---|
| Name reservation | 30 days, extendable to 150 days |
| Incorporation | 1 working day (SSM client charter, still labelled MyCoID); filings before 12 noon notified the same day |
| Company secretary | Within 30 days of incorporation |
| Beneficial ownership lodgement | Within 60 days of the secretary's appointment |
| Tax estimate (e-CP204) | Within 3 months of starting business |
Our package covers:
- Structure advice: Sdn Bhd, branch, LLP or Labuan company
- Licence check with KPDN, MIDA and the local authority
- Name reservation and Super Form lodgement through a qualified company secretary
- Beneficial ownership register and e-BOS lodgement
- ESD registration and Employment Pass applications
- Bank introduction and a first-year compliance calendar
The total depends on the activity and its licences, the number of expatriates, the accounting and audit scope and the banks involved. We quote each case after one call. Our company formation time by country table compares the one-working-day incorporation.
Tax Overview for Malaysian Companies
Corporate income tax is 24% (rate applicable in 2026) for resident and non-resident companies. Malaysia taxes income accruing in or derived from Malaysia; resident companies are also taxed on foreign-sourced income received there, with exemptions such as dividends.
Does a foreign-owned Sdn Bhd get the SME tax rates?
Not once foreign shareholders hold more than 20% of the paid-up capital. The SME rates are 15% on the first RM150,000 of chargeable income and 17% above that up to RM600,000. The other tests include paid-up capital of RM2.5 million or less and gross business income of RM50 million or less. Otherwise 24% applies throughout.
| Tax | Rate or rule |
|---|---|
| Capital gains on unlisted Malaysian shares | 10% of the net gain (since 1 January 2024) |
| Dividends | Single-tier, no withholding tax; individuals pay 2% on dividend income above RM100,000 |
| Withholding tax to non-residents (no treaty) | Interest 15%; royalties, services and movable property rental 10%; contract payments 13% |
| Service tax | 8%; 6% for food and beverage, telecommunications, parking and logistics, and since 1 July 2025 for construction work, private healthcare and private education |
| Service tax registration | Above RM500,000 of taxable services in 12 months; RM1,500,000 for food and beverage, construction and private healthcare |
| Sales tax | 5% or 10%, depending on the goods |
| Pillar Two | 15% domestic minimum top-up tax and multinational top-up tax for groups with revenue of EUR 750 million or more, financial years from 1 January 2025 |
Form C is due within 7 months of the accounts closing date and the tax estimate (e-CP204) within 3 months of starting business. Malaysia has 75 comprehensive double tax agreements in force. Our corporate tax rates by country table puts the 24% headline in context.
E-invoicing for a new company
MyInvois e-invoicing has covered every phase since 1 January 2026. Under LHDN's e-invoicing timeline and its guideline of 30 August 2026, annual turnover below RM3,000,000 is exempt. The exemption is lost where a non-individual shareholder, the holding company, or a related company or joint venture turns over RM3,000,000 or more. A new Sdn Bhd in a foreign group of that size cannot use it.
Business Licences in Malaysia
Malaysia has no single business licence. The licence follows the activity:
| Licence or approval | Issued by | Who needs it |
|---|---|---|
| WRT licence | KPDN | Foreign-owned wholesale, retail and trade companies |
| Manufacturing Licence or exemption letter | MIDA (Industrial Co-ordination Act 1975) | Manufacturers |
| Premises licence | Local authority (PBT) | Businesses with premises, where applicable |
| Approval at incorporation | Local council, Home Ministry or another agency | For example licensed money lending or defence-related work |
The ESD treats the WRT licence as compulsory before a foreign-owned WRT company hires expatriates, and in March 2026 the Minister said the guidelines require KPDN approval to operate. DP2020 approvals last up to three years. The firm RM1,000,000 paid-up rule belongs to the ESD; DP2020 looks at RM1 million in shareholders' funds.
Labuan: Malaysia's Separate Offshore Regime
Labuan is part of Malaysia but keeps its own regime. A Labuan company is incorporated under the Labuan Companies Act 1990 and registered by the Labuan Financial Services Authority (Labuan FSA) through a licensed Labuan trust company. Trading profits are taxed at 3% and holding income at 0% while the company meets the substance minimum set for its activity. In a year that misses it, profits are taxed at 24%. For an activity with no set minimum, we confirm the treatment before incorporation.
The money rules differ too. A Sdn Bhd is a resident for exchange control and a Labuan entity a non-resident. Malaysian payers cannot deduct 97% of ordinary payments to a Labuan company, or 25% of interest and lease rental. Our guide to Labuan company formation covers the trust company, the resident director and substance.
Visas and Work Permits
Expatriates work on an Employment Pass (EP), issued under the Immigration Department and processed by MYXpats through ESD Online and Xpats Gateway. The employer first registers with the Expatriate Services Division, which checks paid-up capital:
| Ownership | Paid-up capital for ESD registration |
|---|---|
| Joint venture with at least 30% foreign equity | RM350,000 |
| 100% foreign-owned | RM500,000 |
| Foreign-owned wholesale, retail or trade | RM1,000,000, plus the WRT licence |
MIDA uses the same bands in manufacturing and selected services, plus foreign paid-up capital of at least RM1 million for Key Posts.
| Official step | Time |
|---|---|
| ESD company registration (once) | 5 working days |
| Section 60K approval (Employment Act 1955), with MYFutureJobs advertising where applicable | 10 working days |
| Support letter, regulated sectors only | 3 working days fast track, 10 normal |
| EP application | 2 working days fast track, 5 normal |
| Endorsement and i-KAD, in person at the ESC or KLIA for new entries | 1 working day |
Investors, shareholders and owners in MIDA-regulated sectors skip the advertising. Since 1 June 2026 the Revised Expatriate Salary Policy sets higher basic salary floors for its three categories. Categories I and II allow up to 10 years with the same employer, Category III up to 5. All three may bring dependants. Succession plans for Categories II and III start on 1 January 2027, and the 1:3 Internship Policy adds three paid MySIP internships per expatriate.
Banking for Malaysian Companies
A Sdn Bhd is a "Resident" under Bank Negara Malaysia's Foreign Exchange Policy, whoever owns it. Exchange control places no restriction on non-resident shareholders investing, and they may repatriate profits, dividends and divestment proceeds in foreign currency, subject to the bank's normal due diligence. Our bank account opening team prepares the file and makes the introduction.
How do you open a company bank account in Malaysia?
After incorporation, with the bank you choose. Each bank sets its own document list, meeting rules and timeline as part of its due diligence. Exchange control treats the Sdn Bhd as a resident even when every shareholder is foreign. We assemble the file with you first.
Compliance and Reporting Obligations
| Obligation | Rule | Deadline |
|---|---|---|
| Annual return, with beneficial ownership information | s.68 | Within 30 days of each incorporation anniversary; none in the year of incorporation |
| Financial statements | s.248 | Within 18 months of incorporation, then 6 months after each year end |
| Circulation to members, then lodgement with SSM | s.258(1)(a), s.259(1)(a) | Within 6 months of year end, then within 30 days, in ringgit |
| Auditor | s.267(1) | Appointed every year unless exempt |
| Change of beneficial owner, director, secretary or registered office | s.60B(4), s.58, s.46 | Within 14 days |
| Form C income tax return | LHDN | Within 7 months of the accounts closing date |
Audit exemption. Under Practice Directive 10/2024 a private company is exempt if it meets two of three criteria in the current and previous two financial years. For financial years from 1 January 2026 the limits are RM2,000,000 of revenue, RM2,000,000 of total assets and 20 employees, rising to RM3,000,000 and 30 employees from 1 January 2027. Public companies, their subsidiaries, registered foreign companies and exempt private companies that lodged a section 260 certificate are excluded, and members holding 5% can still demand an audit.
Beneficial ownership. Division 8A (ss.60A to 60E), in force since 1 April 2024, requires a register of the natural persons who ultimately own or control the company. SSM's guidelines use criteria including 20% of the shares or voting shares.
Nominee position. Nominee shareholders are lawful, but since 1 April 2024 the definition of beneficial owner "does not include a nominee of any description" (s.2). A false statement in reply to the company's beneficial ownership notice is an offence (s.60C(9)). A nominee director owes the duties of s.213 and must not subordinate the company's interest to the nominator's (s.217, an offence). We do not provide nominee shareholders or nominee directors.
Our accounting and tax compliance service can run this calendar for you.
Forming a Malaysian Company as a Non-Resident
A non-resident can own every share of a Sdn Bhd and sit on its board. The residence test applies only to the minimum number of directors: one director of a Sdn Bhd must have a principal place of residence in Malaysia (s.196(4)). There is no citizenship test and no day count, other directors may live anywhere, and an alternate does not count.
The non-resident founder provides a passport and residential address for the Super Form, with certified translations of anything not in Malay or English. Founders do not file in person; only the CRS account holder, usually the secretary, verifies identity at an SSM counter or kiosk. The Employment Pass endorsement is the step that needs a visit.
For exchange control the company is a resident even when its owners are not, and non-resident shareholders repatriate dividends in foreign currency. Each bank sets its own onboarding rules.
Frequently Asked Questions
Can a foreigner own 100% of a company in Malaysia?
Yes, in most activities. The Companies Act 2016 imposes no equity conditions, and new manufacturing projects may be entirely foreign-owned. Distributive trade is the main exception: several retail formats are closed, convenience stores are capped at 30% foreign equity and hypermarkets need at least 30% Bumiputera equity. Regulators in other licensed sectors may attach equity conditions to their approvals.
How long does Malaysia company registration take?
One working day for the incorporation itself under SSM's client charter, with same-day notification for filings before 12 noon. Name reservation comes first. The secretary follows within 30 days and the beneficial owners within 60 days of that appointment. Hiring expatriates adds ESD registration, 5 working days.
What does the total for registering a company in Malaysia depend on?
Mainly on the activity and the hiring plan. Foreign-owned distributive trade needs KPDN approval, manufacturing a MIDA licence and premises a local authority licence. Expatriates add ESD registration and Employment Pass work, and the secretary, accounting, audit and banking complete the picture. We quote once the activity and staffing are clear.
Do I need to visit Malaysia to register a company?
No. Founders lodge nothing in person; the CRS account holder, usually the company secretary, verifies identity once at an SSM counter or tap.it kiosk. An Employment Pass does need a visit, for endorsement and the i-KAD at the ESC or KLIA. Banks set their own attendance rules.
Is MyCoID still used to register companies?
No. SSM's Corporate Registry System (CRS), reached through SSM4U, replaced MyCoID on 14 July 2026 for name searches, incorporations and lodgements. Some official pages, such as LHDN's tax registration page and SSM's client charter image, still mention MyCoID. Guides that walk you through MyCoID screens describe the old system.
What is an MNC company in Malaysia?
MNC means multinational company, a business term rather than a legal form. A foreign group enters Malaysia through a locally incorporated company, usually a Sdn Bhd, or registers the parent with SSM as a foreign company under s.561. That second route also requires a resident agent in Malaysia.
Get Started: Form Your Malaysian Company
Tell us the activity, the shareholders and whether you plan to hire expatriates. We confirm the licences, the resident director plan and the capital the ESD will expect, then prepare the CRS filing. Call +48 2222 5 2222 or email info@companyformation24.com to start.
Content prepared by Aleksandra Kowalska, Corporate Client Service. Approved by Tomasz Bielski, Managing Director.
