Malaysia Company Formation
Malaysia Company Formation: Establishing a Business in Southeast Asia’s Strategic Hub Main Characteristics and the basic rules of Company registration in Malaysia
Malaysia Company Formation with BRIS Group
BRIS Group offers professional Malaysia company formation services for entrepreneurs and international investors seeking to establish a strong presence in Southeast Asia. Setting up a company in Malaysia provides access to a dynamic economy, a strategic location, and a business-friendly environment — making it an ideal choice for regional and global expansion.
Our experts handle the complete Malaysia company registration process remotely, including corporate banking support, compliance, and ongoing administration. With BRIS Group, your Malaysian company will be fully compliant and ready to operate efficiently across Asia and internationally.
A Comprehensive Guide for Non-Residents to Register a Company in Malaysia
Malaysia is one of Asia’s most vibrant and business-friendly economies, strategically located in the heart of Southeast Asia. Known for its political stability, robust infrastructure, and open investment climate, Malaysia company formationoffers international investors a gateway to the ASEAN market and beyond.
This guide explores everything you need to know about setting up a company in Malaysia — from business advantages and registration requirements to tax structures and incorporation procedures
Why Choose Malaysia for Company Formation?
Malaysia’s economy is diverse, competitive, and increasingly open to foreign investment. Supported by advanced logistics, English-speaking professionals, and modern digital infrastructure, Malaysia serves as an ideal base for regional operations.
Key benefits of forming a company in Malaysia include:
- Strategic Location:Â Positioned between China, India, and Singapore with excellent air and sea connectivity.
- Pro-Business Environment:Â Transparent legal framework and investor protection laws.
- Attractive Tax Incentives:Â Special economic zones and pioneer status benefits for key industries.
- Skilled Multilingual Workforce:Â English is widely spoken, facilitating easy business communication.
- Cost-Effective Operations:Â Lower setup and running costs compared to Singapore or Hong Kong.
- Comprehensive Double Tax Treaties:Â Agreements with over 70 countries.
- Access to ASEAN Market:Â Duty-free access to 10 ASEAN countries through trade agreements.
Types of Companies in Malaysia
Foreign investors can choose from several entity types depending on their goals and capital structure:
- Private Limited Company (Sendirian Berhad – Sdn. Bhd.)
The most common structure for foreign investors. It offers limited liability and can be 100% foreign-owned in most sectors.
- Labuan Offshore Company
Ideal for international trade and holding activities. Offers low tax rates and flexible ownership rules.
- Representative Office (RO)
For foreign companies wishing to explore the Malaysian market or manage liaison activities without generating revenue.
- Branch Office
Allows foreign companies to conduct business in Malaysia under the parent company’s name.
- Public Limited Company (Berhad – Bhd.)
Suitable for large corporations planning to list on the Bursa Malaysia Stock Exchange.
Advantages of Malaysia Company Formation for Non-Residents
- 100% foreign ownership permitted in many industries.
- No restriction on profit repatriation.
- Modern banking and digital infrastructure.
- Efficient online incorporation process through the Companies Commission of Malaysia (SSM).
- Stable economy and investor-friendly government policies.
- Availability of skilled, English-speaking professionals.
- Access to Islamic finance hub and Labuan’s offshore tax benefits.
Disadvantages of Malaysia Company Formation
- Certain sectors (e.g., logistics, retail, and agriculture) have foreign ownership caps.
- Regulatory requirements can vary by industry.
- Local director requirement — at least one Malaysian resident director is mandatory.
- Approval-based licensing for regulated industries (finance, energy, etc.).
Requirements for Company Registration in Malaysia
To register a Sdn. Bhd. company in Malaysia, you must provide:
- Approved company name via the Companies Commission of Malaysia (SSM).
- At least one director residing in Malaysia.
- Minimum one shareholder (individual or corporate).
- Registered office address in Malaysia.
- Company Secretary licensed by the SSM.
- Paid-up capital (minimum RM 1, though higher capital is recommended for visas).
- Memorandum and Articles of Association.
- Identification documents of all directors and shareholders.
Procedure for Company Formation in Malaysia
- Reserve Company Name:Â Submit proposed names to SSM for approval.
- Prepare Incorporation Documents:Â Draft company constitution and complete statutory forms.
- Appoint Company Secretary:Â Must be done within 30 days of incorporation.
- File Incorporation with SSM:Â Submit application online through the MyCOID 2016 system.
- Obtain Certificate of Incorporation:Â Issued upon successful registration.
- Register for Tax (LHDN):Â Obtain a company tax file number.
- Open Corporate Bank Account:Â Required for capital injection and transactions.
- Apply for Relevant Business Licenses:Â Industry-specific permits if required.
Timeframe for Company Formation in Malaysia
|
Stage |
Estimated Duration |
|
Name Reservation |
1–2 business days |
|
Document Preparation |
2–4 business days |
|
Company Registration with SSM |
3–5 business days |
|
Tax and Bank Account Setup |
3–7 business days |
Total Estimated Time: 1–2 weeks for a complete company setup in Malaysia.
Corporate Tax System in Malaysia
Malaysia’s corporate tax regime is straightforward and investor-friendly, with various incentives for specific industries and locations.
|
Tax Type |
Rate |
Notes |
|
Corporate Income Tax (CIT) |
24% |
Standard rate for resident companies. |
|
SME Corporate Tax Rate |
15%–17% |
For small and medium enterprises with revenue under RM 50 million. |
|
Labuan Offshore Tax |
3% or flat RM 20,000 |
For qualifying Labuan offshore companies. |
|
Withholding Tax |
10%–15% |
On dividends, royalties, and interest to non-residents (treaty-based). |
|
Sales and Service Tax (SST) |
6% |
Applies to goods and services. |
Incentives:
- Tax exemptions for pioneer status companies.
- Investment tax allowance for manufacturing and green projects.
- Double tax relief under Malaysia’s DTA network.
- Labuan offshore companies enjoy flexible tax options and confidentiality benefits.
How We May Help You with Our Professionals
Our dedicated professionals simplify the Malaysia company formation process for foreign investors, ensuring smooth compliance and efficient business setup.
Our services include:
- Business structure and ownership consultation.
- Name reservation and SSM registration.
- Drafting incorporation and compliance documents.
- Local director and registered office provision.
- Bank account setup support.
- Tax and SST registration.
- Legal, accounting, and compliance services.
- Ongoing corporate secretarial assistance.
Start Your Malaysia Company Formation Journey Today
With its strong economy, pro-investment policies, and strategic location in Asia, Malaysia provides a solid foundation for international expansion. Whether you’re a startup, SME, or multinational, incorporating in Malaysia opens doors to one of the region’s most promising business destinations.
Our experienced consultants can manage your entire Malaysia company formation process — from documentation to registration and post-incorporation compliance.
Contact us today to establish your presence in Malaysia and begin your journey toward success in Southeast Asia’s thriving market.
Questions & Answers
1. What is Corporation Tax in Malaysia?
Corporation tax in Malaysia is levied on the income of resident companies at a standard rate of 24%. Small and medium-sized enterprises (SMEs) with paid-up capital of RM2.5 million or less benefit from a reduced rate of 17% on the first RM600,000 of chargeable income. The tax is applicable to both local and foreign companies operating in Malaysia.
2. How is Income Tax calculated in Malaysia?
Individual income tax in Malaysia is progressive, ranging from 0% to 30% based on income brackets. Tax residents must file their returns annually and can claim various deductions, such as for education, medical expenses, and investments. The personal tax rate for income up to RM5,000 is 0%, while income exceeding RM2 million is taxed at 30%.
3. What is VAT in Malaysia?
Malaysia implements a Goods and Services Tax (GST), known as VAT in other countries, at a standard rate of 6%. However, as of September 2018, the country has suspended GST in favor of Sales and Service Tax (SST), which consists of two components: a sales tax of 5% to 10% on goods and a service tax of 6% on certain services.
4. What is Dividends Tax in Malaysia?
Dividends distributed by Malaysian companies are generally exempt from withholding tax for residents, under the single tier system. However, foreign investors may face a withholding tax rate of 15% unless reduced by treaties. Corporate shareholders are also exempt from tax on dividends received from resident companies.
5. Are there other taxes in Malaysia?
Yes, Malaysia has various other taxes, including property tax, stamp duty, and excise duties. Property tax is levied at varying rates depending on local council policies. Stamp duty applies to property transactions and is calculated based on the value of the property. Excise duties target specific goods, such as alcohol and tobacco, and vary by product type.
Learn more: Visit our Full FAQ HUB page
or contact our tax and company formation team at[email protected]
What is the process for company formation in Malaysia for non-residents?
The process for non-residents to form a company in Malaysia involves several steps. First, you need to decide on the type of company you want to establish, typically a private limited company (Sdn Bhd). Next, you must choose a unique company name and submit it for approval. After that, you will need to prepare the necessary documents, such as the Memorandum and Articles of Association, and appoint a local director. It’s essential to register your company with the Companies Commission of Malaysia (SSM) and obtain necessary licenses depending on your business activities.
Do I need a local director for my company in Malaysia?
Yes, according to Malaysian law, all companies must appoint at least one resident director who is a Malaysian citizen or a foreigner with a valid work permit. This local director will be responsible for managing the company and ensuring compliance with local regulations. This requirement is crucial for non-residents looking to establish a business in Malaysia.
What are the costs associated with forming a company in Malaysia?
The costs for forming a company in Malaysia can vary based on several factors, including the type of business entity and the services you choose. Typical costs include registration fees, local director fees, company secretary fees, and additional expenses for licenses or permits. On average, the total cost can range from RM1,500 to RM5,000 or more, depending on the complexity of your business.
How long does it take to register a company in Malaysia?
The registration process for a company in Malaysia usually takes between 1 to 2 weeks if all documents are in order. The timeline can vary based on the completeness of your application and the efficiency of the relevant authorities. It is advisable to work with a professional service provider to ensure a smooth registration process, especially for non-residents unfamiliar with local laws.
What are the tax implications for non-resident companies in Malaysia?
Non-resident companies operating in Malaysia are subject to various tax obligations, including corporate income tax on income derived from Malaysia. The standard corporate tax rate is 24%, but there may be lower rates for resident companies with a new venture. Additionally, non-residents may be subjected to withholding taxes on certain types of income. It is recommended to consult with a tax advisor to understand your specific obligations and any applicable tax treaties.
Can a foreign company operate in Malaysia without registering?
No, a foreign company cannot operate in Malaysia without registering it as a legal entity. Engaging in business activities without proper registration can lead to legal repercussions and penalties. To operate legally, non-residents must follow the company formation process and ensure compliance with Malaysian laws, including securing necessary licenses and permits for their business activities.
or contact our tax and company formation team at
This publication is provided for information purposes only. This info should not be treated as a substitute for a tax or legal consultation or legislation. You should not act on the basis of the information contained in this publication without having obtained individual advice from the professional expert.
BRIS GROUP does not assume responsibility for any damage resulting from decisions made by the reader on the basis of this publication.
About Malaysia
Capital: Kuala Lumpur
Region: is a Southeast Asian country occupying parts of the Malay Peninsula and the island of Borneo.
Currency: The Malaysian Ringgit (MYR)
Time Zone: GMT+8
Dial Code: +60
Abbreviations: MY
Helping Your Company Thrive in Malaysia With us, starting and running a business in Malaysia will be easy and efficient!
- Full support of the company’s registration in Malaysia: from the preparation of documents to their submission.
- Remote registration: all processes are online, wherever you are.
- Secretary and Treasurer: we can take on these important roles.
- Nominal directors and shareholders: we will ensure the confidentiality of your information.
- Help in opening a bank account: we will simplify this complex process.
- Registration for taxes, VAT and EORI: ensure all requirements are met.
- Website development: we will create a professional online representation for your business.
- Logo creation: we will design a unique and memorable logo for your brand.
- Full administrative support of the company: we will take over routine tasks.
- Mailing address organization: we provide a reliable mailing address for your business.
- Organization of the virtual office: we will ensure the professional image of your company.
- Telephone answering service: we will answer calls on behalf of your company.
- Accounting, audit and reporting: ensure accurate and timely accounting.
- Preparing and filing a VAT declaration: let’s save you the trouble.
- Interaction with local authorities: take over communication with state institutions.
- Trademark registration: protect your brand.
- More Emphasis on Customer Input.