Company Registration in Malaysia: Complete Guide For Foreigners

Malaysia has established itself as one of Southeast Asia’s most accessible markets for foreign entrepreneurs. According to the Companies Commission of Malaysia (SSM), over 1.59 million companies were registered as of end-2025, with more than 60,000 new incorporations in 2025 alone reflecting sustained investor confidence in the country’s business environment.

Foreign investors benefit from a corporate tax rate of 24% (17% for SMEs on the first RM600,000 of chargeable income), 100% foreign ownership in most sectors, and a fully digitalised registration system. A standard Sdn Bhd can be incorporated within 1-3 working days once all documents are in order.

Whether you are setting up your first ASEAN operation, expanding an existing business, or exploring Malaysia’s investment incentives, this guide covers every step of company registration in Malaysia for foreigners from choosing the right structure to post-incorporation compliance.

 

Why Foreign Investors Choose Malaysia?

Malaysia offers a compelling combination of regulatory clarity, tax efficiency, and regional market access that few jurisdictions in Southeast Asia can match:

• 100% foreign ownership permitted in most industries under Malaysia’s liberalised equity policy
• Corporate tax rate of 24% (17% for qualifying SMEs on the first RM600,000 chargeable income)
• Double Taxation Avoidance Agreements (DTAAs) with 75 countries, protecting foreign businesses from being taxed twice
• No restriction on repatriation of profits, dividends, or capital gains
• Fully digitalised incorporation via MyCoID, no physical presence required
• Strategic ASEAN gateway with direct access to a market of 680 million consumers

What Are The Business Structures Available to Foreigners in Malaysia?

As a foreigner, your options are determined by the Companies Act 2016 and sector-specific regulations. The four primary structures are:

• Private Limited Company (Sdn Bhd): Recommended

The Sdn Bhd is the most common structure for foreign investors in Malaysia under the Companies Act 2016, offering limited liability as a separate legal entity. Foreigners can own 100% in most sectors, with a minimum paid-up capital of RM1 (though RM500,000-RM1,000,000 may be needed for Employment Passes or licences), at least one locally resident director, and 1-50 shareholders with no nationality restrictions. 

A Malaysian or PR company secretary must be appointed within 30 days, and foreigners cannot register a Sole Proprietorship or Partnership unless they hold PR status. 

• Branch Office

A branch office is not a separate legal entity, it is a direct extension of the foreign parent company, which retains full liability for the branch’s obligations in Malaysia. Registration fees are higher and are calculated on the parent company’s nominal share capital (starting from RM5,000 for share capital up to RM1,000,000). 

Suitable for established foreign companies expanding operations into Malaysia on a defined-scope basis.

• Representative Office

A representative office cannot generate revenue or enter into commercial contracts. It is appropriate for market research, liaison activities, and pre-investment feasibility studies. Approved by the Malaysian Investment Development Authority (MIDA).

• Limited Liability Partnership (LLP)

An LLP combines features of a partnership and a company. Foreigners may register an LLP but must appoint a Compliance Officer who is a Malaysian citizen or permanent resident. Typically used by professional service firms; less commonly used for general commercial activities.

What Are The Step For Company Registration Process in Malaysia In 2026?

All Sdn Bhd registrations are processed through SSM’s MyCoID 2016 portal, and the entire process can be completed online.

Step 1: Company Name Search and Reservation

Submit a name application via MyCoID at a cost of RM50 per application. SSM will review the proposed name to ensure it is unique and does not contain restricted words such as “bank” or “insurance” without prior approval. Once approved, the name is reserved for 30 days and can be extended up to 180 days.

Step 2: Prepare Incorporation Documents

After name approval, the company secretary prepares the required documents, including the Super Form under Section 14 of the Companies Act 2016, particulars of directors, shareholders, and company secretary, an optional Company Constitution (unless special provisions are needed), and a statutory declaration confirming directors are not undischarged bankrupts or convicted of relevant offences under Section 201.

Step 3: Submit via MyCoID and Pay Incorporation Fee

The company secretary must submit the incorporation application within 30 days of name approval through MyCoID. The SSM incorporation fee for a company limited by shares is RM1,010, inclusive of applicable levies.

Step 4: Receive Notice of Registration

Once approved, SSM issues a Notice of Registration under Section 15. A Certificate of Incorporation under Section 17 can be requested separately, with a processing time of around 5-10 working days. The typical incorporation timeline is 1-3 working days from submission.

Step 5: Post-Incorporation Compliance

Within 30 days of incorporation, the company must appoint a qualified company secretary, register for a corporate tax file (Form CP 600C) with LHDN, open a Malaysian corporate bank account, register for SST if annual turnover exceeds RM500,000, apply for relevant industry licences such as the WRT licence, and register with the Expatriate Services Division (ESD) if applying for Employment Passes.

What Is a Company Registration Costs in Malaysia for Foreigners In 2026?

The Government fees are fixed but the professional service fees vary by provider and scope. The cost structure is as follow:

Item	Cost	Payable To
Name reservation (per application)	RM50	SSM
Sdn Bhd incorporation fee (limited by shares)	RM1,010	SSM
Certificate of Incorporation (Section 17, if requested)	~RM100	SSM
Company secretary (first year)	RM600-RM1,500	Service provider
Registered office address (virtual, per year)	RM600-RM1,200	Service provider
Nominee resident director (per year, if required)	RM3,000-RM6,000	Service provider
Corporate bank account opening	Free-RM500	Bank
Professional incorporation service fee	RM1,000-RM3,000	Service provider
Estimated total (first year)	RM6,000-RM13,000	Mixed (SSM, bank & service providers)

Which Industries Allow 100% Foreign Ownership in Malaysia?

Malaysia’s liberalised equity policy generally permits 100% foreign ownership. However, certain strategic sectors require Malaysian equity participation or government approval prior to incorporation. As a rule of thumb:

Generally, 100% foreign ownership is permitted in technology, e-commerce, consulting, trading, manufacturing (most categories), financial technology, logistics, and professional services (engineering, accounting, and architecture, subject to professional body requirements)

Restricted or regulated sectors (require local equity or prior approval):

• Telecommunications and broadcasting
• Banking, insurance, and financial services
• Oil and gas (upstream)
• Education (private)
• Healthcare (hospitals and clinical services)
• Wholesale, Retail, and Trade (WRT) 

100% foreign-owned companies must obtain a WRT licence from the Ministry of Domestic Trade and Cost of Living (KPDN); approval is granted only for business concepts deemed unique or beneficial to Malaysia’s economy

For sector-specific equity requirements, refer to the Malaysia Investment Development Authority (MIDA) or consult a licensed corporate advisory firm.

What Are Resident Director and Company Secretary Requirements?

Under Section 196(4) of the Companies Act 2016, every Malaysian company must have at least one director who is ordinarily resident in Malaysia. “Ordinarily resident” means the person’s principal place of residence is in Malaysia. The director may be:

• A Malaysian citizen
• A Permanent Resident (PR)
• A holder of a valid long-term pass (e.g., Employment Pass, Malaysia My Second Home (MM2H), or Resident Pass – Talent)

Foreign founders who do not yet reside in Malaysia may appoint a professional nominee resident director through a licensed corporate services firm to fulfil this statutory requirement.

A qualified company secretary must be appointed within 30 days of incorporation (Section 235, Companies Act 2016). The secretary must be either a member of the Malaysian Institute of Chartered Secretaries and Administrators (MAICSA) or licensed by SSM.

What Are The Work Pass Requirements for Foreign Business Owners In 2026?

To legally work and manage your Malaysian company from within Malaysia, you will need the appropriate pass from the Immigration Department:

Pass Type	Best For	Key Requirement
Employment Pass (EP) Category I	Foreign professionals in managerial/executive roles	Minimum monthly salary RM10,000; company must have minimum paid-up capital per ESD guidelines
Employment Pass (EP) Category II	Technical/skilled roles	Minimum monthly salary RM5,000
Malaysia Tech Entrepreneur Programme (MTEP)	Tech founders in AI, fintech, agritech	Approved via MaGIC
Malaysia My Second Home (MM2H)	Long-term residency without employment	Subject to revised MM2H criteria

Employment Pass applications are submitted to the Expatriate Services Division (ESD) via the ESD portal. Most applications take 4-8 weeks from submission.

What Are the Annual Compliance and Filing Obligations for Foreign Companies in Malaysia?

Once incorporated, a Malaysian Sdn Bhd has the following mandatory annual obligations under the Companies Act 2016 and the Income Tax Act 1967:

• Annual Return: Must be submitted to SSM within 30 days of the anniversary of incorporation. Failure attracts a penalty of up to RM50,000 for the company and its officers.
• Audited Financial Statements: All Sdn Bhd companies must file audited accounts unless they qualify for audit exemption, which applies if annual revenue and total assets are ≤ RM3 million and the company has fewer than 5 employees (including dormant or zero-revenue companies). 
• Corporate Income Tax Return (Form C): Must be filed with LHDN within 7 months of the financial year-end.
• Estimated Tax Payable (Form CP 204): Must be submitted 30 days before the commencement of the basis period.
• SST Return: Quarterly submission if the company is registered for Sales and Services Tax.
• EPF and SOCSO: Mandatory employee contributions if the company employs Malaysian staff.

Conclusion

Malaysia continues to be one of the most accessible and commercially viable destinations in Southeast Asia for foreign investors. With 100% foreign ownership permitted in most sectors, a fully digitalised registration process, and a competitive tax environment, establishing a legal business presence in Malaysia is more straightforward than ever, provided you understand the regulatory framework and work with the right advisors.

3E Accounting has been assisting foreign entrepreneurs and multinational corporations with company registration, corporate secretarial services, and tax compliance in Malaysia for over two decades. 

Whether you are setting up your first Malaysian entity or restructuring an existing one, our team provides the expertise and on-the-ground support to ensure your incorporation is done correctly, efficiently, and fully in compliance with Malaysian law.

Frequently Asked Questions