Malaysia represents one of Southeast Asia’s most prosperous economies. Its market-oriented culture and welcoming business policies entice international investors to establish operations in Malaysia. Every company’s incorporation a Company in Malaysia requires it to be registered with the Malaysian Company Commission(MCC). The Malaysian Company Commission permits foreigners to establish private limited companies by shares and allows them to establish 100% foreign-owned companies in specific commercial fields.
Malaysia has lured several foreign investors because of its warm and friendly demeanor. The World Bank’s 2018 Ease of Starting Report ranks Malaysia as being one of the best countries in the world to conduct business.
This article discusses some primary advantages of incorporating a company in Malaysia.
Reduced Corporate Tax
First and foremost, there are several tax advantages to forming a limited liability corporation in Malaysia. Unlike sole proprietorships and partnerships, which pay a greater tax rate, LLCs and LLPs in Malaysia are generally taxed at 24 percent. Any LLP/LLC with a donation of 3 million ringgit pays a lower tax rate of 19%.
You’ll be surprised to know that Malaysian corporate taxpayers aren’t taxed on their complete income since only a fraction of their income is taxed. Regarding individual income tax, there are adjustments in paying only the minimum amount if your income drops below the government-prescribed threshold.
Economic Stability
Malaysia is regarded as the world’s most stable economy. Malaysia’s economy is now growing at a rate of more than 5%. Because of the strong economy, most global brands desire to establish a presence in Malaysia. The nation’s economy’s consistent expansion helps to keep the overall economy stable. Regarding business, if a country’s economic situation is robust, company owners face no dangers.
A proactive government
Malaysia’s government is proactive and encourages various sorts of businesses to set up their offices in the country. The government always attempts to enhance the country’s corporate field. Whether it is modifying corporate regulations and policies or building infrastructure, the government takes all measures to grow the Malaysian economy.
Possibility of establishing a Labuan company
The Malaysian government enables foreigners to establish a Labuan corporation. It is a corporation that may be formed with minimal taxation. With the change in tax legislation in 2019, Labuan will have new options. The trading firm must now refund only 3% tax, while the investment and holding companies are exempt from paying any tax. The increased tax rates, however, do not apply to companies or businesses that own intellectual property or get royalties. For firms that earn rental income from Malaysian properties, the tax rate stays at 24%.
A Well-Educated Workforce
A well-educated workforce is a country’s backbone. A well-educated workforce benefits a nation in every industry. Malaysia’s working population is highly educated. Any corporate firm can acquire a highly educated workforce to operate efficiently.
Expand Capital Funding Access
Every form of business requires a steady source of financial resources and growing cash flow in the event of depletion. Companies may raise capital more efficiently than partnerships or sole proprietors. It can be accomplished by issuing debt or stocks to investors. In terms of credit, a Malaysian company, which is called (Sdn Bhd Business) can borrow more money at cheaper rates than other businesses.
A Changing Business Environment
A favorable tax climate enables many businesses to provide reasonably priced, high-quality items. The Malaysian economy adheres to global manufacturing standards, contributing to the dynamic business climate that keeps Malaysia a favored Asian investment location. This is one of the reasons why you should do company incorporation in Malaysia.
Economic Stability
Malaysia’s strategic location, solid infrastructure, skilled workforce, political stability, & low-cost structure all contribute to a favorable business climate and give it an economically stable environment. Malaysia has a sizable and expanding market for high-end goods. The immense potential is fueled by solid government support and commitment to building a growth economy based on entrepreneurship, technology, and information.
Incorporating a company in Malaysia
The process for incorporating a company in Malaysia is a pretty simple task. All you have to do is to register a company under the Malaysian companies act, 2016. You’ll have to fill in a few details such as the proposed company name, whether you’re establishing a private or public Company, the proposed business type, registered office address, and business address. Paid-Up Capital (minimum of RM1), details of directors(s) and promoter(s), etc.
You will get the notification of registration for proof of formation via email within one working day. If there are any queries about the application, you will be alerted by email. The application may be revised and resubmitted accordingly.
Conclusion
Malaysia’s government offers several business opportunities and facilities to attract foreign direct investment. Malaysia has been a popular destination for international companies due to its strong economy and politically stable situation.
If you wish to expand your business in Malaysian markets, get in touch with PikoHANA, an expert at company formation services in Malaysia. Most foreign companies register as a Sdn Bhd in Malaysia and our experts can help you with the entire process. Regardless of your citizenship or your current location, PikoHANA will take care of all the procedural documentation and form-filling. Get in touch with them as they are one of the best company formation services in Malaysia.
With easy regulations, registering a company in Malaysia is easy compared to several other South Asian countries. And we are here to make your company formation process easy and seamless. We offer a complete package of company formation and incorporation services that help you set up your business in Malaysia. Our team consists of incorporation specialists with a good amount of knowledge, and they can guide you through every step of company formation. We take care that your company formation process in Malaysia goes smoothly.
If you have a sound business strategy and are looking to register your company with the Malaysian Company Commission, then PikoHANA can be your one-stop solution. Whether you are looking to incorporate your business or outsource accounting services in Malaysia to seize prevailing opportunities in the country, we are there to help you! For more details, get in touch with our team today!
