Start Up Business in Malaysia- Matters to Consider

Businesses in Malaysia are required to be carried out by either these two types of business organisations:

• Business firms (governed under Registrar of Business Act 1956)
• Registered companies (governed under Companies Act 1965)

What is the difference between a business firm and a company limited by shares?

		Business firm	Company limited by shares
1.	Legal standing	·         Not separated from individual/ individuals who own the business	·         Legally separated from owners and individuals who run business
2.	Liability	·         Not limited	·         Limited to remaining unpaid amount on the members' shares
3.	Succession	·         Once identity of individual participants change (eg partners die, resign or new partners or sole proprietor dies or become bankrupt) the sole proprietor is dissolved or the partnership is dissolved	·         There is perpetual succession ·         Company continues to exist unless it is liquidated or deregistered ·         Can transfer interest to other parties by executing share transfer forms
4.	Formation	·         Register with Registrar of Business ·         Some partnerships may have partnership agreements ·         Fee: less than RM100	·         Incorporate under the Companies Act 1965 ·         Lodge statutory forms and memorandum of association and articles of association with the Companies Commission of Malaysia ("CCM") otherwise known as Suruhanjaya Malaysia ·         Fee: RM2,600-2,800 or more
5.	Owner	·         1 for sole proprietor ·         2 to 20 max for partnership	·         2 to 50 max (no limit for PLCs)
6.	Ownership of properties	·         Jointly owned by the individual/ individuals who owns business	·         Owned by the company not the shareholders
7.	Management	·         Managed by individual/ individuals who owns business. ·         All partners are entitled to participate in management of partnership	·         Managed by the Board of Directors. Every company must have at least 2 directors who are principally residing in Malaysia. Directors may or may not be a shareholder of the company. ·         There must be at least 1 company secretary.
8.	Annual returns	·         Not required to submit any report to the Registrar of Business	·         Lodge with Companies Commission of Malaysia returns ·         Lodge annually an Annual Return and audited accounts
9.	Taxation	·         Profits made are added to the individual/ individuals personal income and are individually liable for the profit under personal income tax.	·         Company is subject to income tax at the rate applicable. ·         The corporate tax rate is currently 27%. It will be revised to 26% for the year of assessment 2008 and 25% for the year of assessment 2009 onwards.

(Source: Start Up Business in Malaysia- Matters to Consider )

Step-By-Step to Register a Business

Registreing a business (ROB) is a complete different ball game from registering a company (ROC). Here on ROB is explained in detail - because that is my utmost priority at the moment. 

Registering Online via eLodgement on SSM (Companies Commission of Malaysia)

1. Click on the link above or go to http://www.ssm.com.my/en/services_eLodgement.php - it will take you to a welcome page for the Official Portal of the Companies Commission of Malaysia
2. Click on e-Lodgement SSM - next click on PSP User Registration
3. 
   
   At the sign up page, you may choose INDIVIDUAL if you are entitled as CITIZEN, PERMANENT RESIDENT or as NON CITIZEN.Or you may choose BUSINESS if you presented as business or company to liase with government agencies.Please ensure that you have a valid email address for this registration process.
   
   
   Note: For SSM Registration, I registered as INDIVIDUAL User.
4. Fill in your details on the Update Profile page and click Next
5. If all details are entered correctly, you will see the following landing page.
   
   
6. Click Continue - and check your email.  A confirmation email will be send once your verification of Identification Card and Name with JPN is completed. An activation link (validity 30 days) will be provided. Click on the link to activate your account.