Guide to Starting a Business in Malaysia

Are you considering expanding your business into Malaysia? Home to over 34 million consumers, Malaysia ranks 12th for ease of doing business globally. However, the country ranks 126th for starting a business, indicating that the initial setup process can be quite complex.

In this comprehensive guide, we will walk you through the essential steps to start your business in Malaysia.

Requirements to Register a Business in Malaysia

To register your business with the Companies Commission of Malaysia (SSM), you need to provide the following documents:

1. Identification documents for all directors and shareholders
2. Proposed company name options and business activity description
3. Incorporation documents (e.g., Memorandum and Articles of Association)
4. Details of directors, shareholders, and company secretary
5. Proof of address such as a rental agreement or utility bills

How to Start a Business in Malaysia

1. Choose the Right Business Structure

When starting your business in Malaysia, the first step is to choose an appropriate business structure. There are 8 types of business entities in Malaysia. However, the most popular and suitable option for most foreign investors is a Private Limited Company (Sdn Bhd). An Sdn Bhd offers limited liability and can have up to 50 shareholders.

It is recommended to consult with a qualified business advisor such as Emerhub to determine the most suitable structure for your specific needs and goals.

2. Reserving a Company Name

After determining the business structure, the next crucial step is reserving the company name with the Companies Commission of Malaysia (SSM). The name must adhere to strict business name registration guidelines provided by SSM.

Emerhub handles the name reservation process for you, ensuring compliance with naming regulations and obtaining the necessary approvals. Simply provide us with your preferred company names and we will handle the rest.

3. Business Registration with SSM

After the business name reservation, the next step is to apply for company registration in Malaysia with the SSM within 30 days.

Emerhub takes care of the entire business registration process with SSM. Our business advisors help you prepare and submit all required documents to the SSM. Once the application is approved, the SSM provides the certificate of incorporation for the company along with the business registration number. 

4. Obtaining the Necessary Licenses and Permits

Depending on your business activities, you may need to obtain various licenses and permits from different government agencies. For instance, if you plan to sell food products to the Muslim population in Malaysia, you will need to obtain a Halal Certificate from JAKIM.

Emerhub’s team has in-depth knowledge of the licensing requirements across industries in Malaysia. We will identify and obtain the necessary licenses and permits for your business so you can start your business operations in compliance with local regulations.

5. Opening a Business Bank Account

To manage your business finances effectively, you’ll need to open a corporate bank account in Malaysia. Most banks require the following documents to open a business bank account:

• Certificate of Incorporation
• Board Resolution
• Identification documents of directors and signatories
• Business registration documents
• Relevant licenses or permits (if applicable)

6. Tax Registration

As per Malaysian regulations, all companies must register for corporate income tax within three months from the date of starting their operations. For that, companies need to submit the application to the Inland Revenue Board of Malaysia (LHDN) and obtain their tax ID.

Minimum Paid-up Capital Requirements for Business Registration in Malaysia

In Malaysia, the minimum paid-up capital requirement is RM 1 (USD 0.21) for locally owned private limited companies.

For 100% foreign-owned companies, the paid-up capital requirements vary depending on the industry and nature of business activities. 

For example:

• A minimum paid-up capital of RM 500,000 is required to set up a consultancy firm
• Businesses engaged in import, export, restaurants, wholesale, trading, and retailing must have a minimum paid-up capital of RM 1 million

It’s important to note that certain regulated industries or activities may have higher minimum paid-up capital requirements set by their respective regulatory bodies. Emerhub’s business advisors can provide you with the latest requirements and guide you in meeting the capital requirements. 

Start Your Business in Malaysia with Emerhub

When planning to start your business in Malaysia, consulting with experienced business advisors helps you navigate the complexities of the market. Emerhub helps entrepreneurs and investors to expand their business operations in Malaysia and other Southeast Asian markets. 

In the past year alone, we have helped more than 2200 investors and businesses to establish and grow their business in new markets. Our team of local experts in Malaysia is well-versed in regulations and requirements and makes the entire business registration process hassle-free.

For a more tailored consultation, fill out the form below and we will put you in touch with one of our business registration experts.