Not every company that is incorporated continues trading forever. Some businesses pause operations due to market conditions, restructuring, changes in partnerships, or strategic realignment. When a company becomes inactive and no longer serves a purpose, keeping it registered can lead to unnecessary compliance costs, penalties and administrative burden.
If you are considering striking off a company in Malaysia, it is important to understand the legal process, eligibility criteria, and directors’ responsibilities. The strike-off process in Malaysia is governed by the Companies Commission of Malaysia (SSM) and must be handled carefully to avoid future complications.
In this guide, we explain how to close a dormant company in Malaysia, the documents required, the timelines involved, and common mistakes to avoid.
What is a Dormant Company in Malaysia?
A dormant company in Malaysia is a company that:
- Has stopped carrying on business
- Has no accounting transactions
- Has no assets or liabilities
- Is not generating revenue
Under the Companies Act 2016, a dormant company is one with no significant accounting transactions during the financial year. Even if the company is inactive, it must still comply with statutory obligations unless it is formally closed.
Many directors assume that not operating the business means there is nothing further to do. Unfortunately, this is not correct. Until the company is officially removed from the register, it remains legally in existence.
What Does it Mean to Strike Off a Company Under SSM Malaysia?
Striking off a company means removing the company’s name from the Register maintained by the Companies Commission of Malaysia under Section 550 of the Companies Act 2016.
Once the strike off is approved:
- The company ceases to exist
- It cannot carry out business
- Directors are released from ongoing compliance obligations
However, directors remain responsible for ensuring the company has no outstanding liabilities before applying.
You may refer to the official SSM website for regulatory guidance: https://www.ssm.com.my
Who is Eligible to Apply for a Strike-off in Malaysia?
Not every company qualifies for strike off. To apply for striking off a dormant company in Malaysia, the company must generally meet the following:
- No ongoing business activities
- No outstanding liabilities to creditors
- No pending court cases
- No outstanding charges in the Register
- No outstanding tax liabilities with the Inland Revenue Board
The directors must confirm that the company is not involved in any legal or financial dispute before submission.
What Are the Conditions for Striking Off a Dormant Company?
Below is a simplified overview of the key strike-off conditions in Malaysia:
| Condition | Requirement |
|---|---|
| Business Activity | The company must not be carrying on business. |
| Assets & Liabilities | Must have zero assets and zero liabilities. |
| Tax Status | No outstanding tax, penalties or assessments. |
| Legal Proceedings | No pending litigation. |
| Government Debts | No outstanding government agency dues. |
If any of the above conditions are not met, the application may be rejected.
What Documents are Required for a Strike Off Application in Malaysia?
When applying to strike off a dormant company, the following documents are usually required:
- Application letter signed by directors
- Directors’ resolution approving strike off
- Latest financial statements
- Declaration confirming no assets and liabilities
- Tax clearance confirmation (if required)
Proper documentation reduces the risk of rejection and unnecessary delay.
What is the Step-by-Step Process to Strike Off a Dormant Company?
Closing a dormant company is not a single filing exercise. It is a structured process that requires directors to tidy up the company’s affairs before approaching the regulator. Below is how the process typically unfolds in practice.
Step 1: Clear All Outstanding Matters
Before anything is submitted, the directors must ensure the company is completely “clean” on the financial and legal fronts. In practical terms, this means:
- Settling any remaining debts or payables
- Closing the company’s bank accounts
- Cancelling business licences or permits
- Ensuring all tax filings are up to date and liabilities are fully paid
A strike-off application will not succeed if unresolved obligations remain. Taking time to review this stage properly prevents rejection later.
Step 2: Obtain Internal Approval
Once the company’s affairs are in order, the directors should formally record their decision to proceed. This is usually done through a board resolution confirming that:
- The company is no longer carrying on business
- It has no assets or liabilities
- The directors approve the application for strike off
- Proper documentation at this stage demonstrates that the decision has been made responsibly and collectively.
Step 3: Submit the Application to the Registrar
After internal approval, the application is submitted to the Companies Commission of Malaysia for assessment.
The Registrar will review the submission to ensure that all statutory conditions have been met. If clarification is required, further information may be requested before the process can proceed.
Step 4: Publication of Gazette Notice
If the Registrar is satisfied, a notice of the proposed strike off is published in the Government Gazette.
This step serves an important purpose. It provides creditors, government bodies, or any interested party with the opportunity to raise objections within the prescribed period. If an objection is lodged, the process may be suspended until the matter is resolved.
Step 5: Removal From the Register
If no objections are received within the notice period, the Registrar will issue a final notice and remove the company’s name from the register.
At that point, the company is officially dissolved and ceases to exist as a legal entity. From then on, it cannot carry on business or enter into any contractual arrangement.
How Long Does It Take to Strike Off a Company in Malaysia?
The strike-off process in Malaysia typically takes between 6 and 12 months, depending on:
- Completeness of documents
- Objections received
- Tax clearance timeline
- Internal SSM processing
Delays often occur when companies have unresolved tax or compliance issues.
What are the Costs Involved in Striking Off a Company?
The cost of striking off a dormant company in Malaysia varies depending on the complexity of the case.
| Cost Component | Description |
|---|---|
| Professional Fees | Preparation and submission of documents |
| Government Fees | SSM processing charges |
| Tax Clearance Costs | If tax filing needs to be regularised |
Engaging a corporate service provider ensures accuracy and minimises the risk of rejection.
What Happens After a Company Is Struck Off in Malaysia?
Once the company is struck off:
- The company ceases to operate legally
- Its name is removed from SSM’s register
- Directors no longer need to file annual returns
However, it is important to note that, under certain circumstances, the company may be restored by court order within a specified period.
Conclusion
Striking off a dormant company in Malaysia is a practical solution for business owners who no longer intend to operate the company. However, the strike-off process must be handled correctly to avoid penalties, objections, or future legal exposure.
If your company is inactive and you wish to proceed with a company strike-off in Malaysia, 3E Accounting can assist with documentation, compliance checks, and submission to the Companies Commission of Malaysia.
Contact our team today to ensure a smooth, compliant, and hassle-free strike-off process.
Close Your Dormant Company the Right Way
Avoid penalties and future complications. Let our corporate specialists manage the strike off process efficiently.
Frequently Asked Questions
No, an active company cannot apply for strike off in Malaysia. The company must be dormant and meet the SSM strike off conditions.
Yes, under certain circumstances, a struck-off company in Malaysia may be restored through a court application within the prescribed timeframe.
Strike off in Malaysia is suitable for dormant companies with no liabilities, while winding up is used for companies with debts or insolvency issues.
Yes, Gazette publication is a mandatory part of the Malaysia strike-off process to allow creditors or interested parties to object.
You can check the strike-off status of your company in Malaysia through official searches with the Companies Commission of Malaysia.
Abigail Yu
Author
Abigail Yu oversees executive leadership at 3E Accounting Group, leading operations, IT solutions, public relations, and digital marketing to drive business success. She holds an honors degree in Communication and New Media from the National University of Singapore and is highly skilled in crisis management, financial communication, and corporate communications.
