Beginner’s Guide on Starting a Childcare Center in Malaysia
The future of any country begins with a child. Children are the future and it is essential for them to receive the necessary education, care, and support to grow into productive members of society. The early years of a child’s life are the most formative years. This is where children begin to develop the foundation they need as they mature and grow.
As society is beginning to recognise the importance of a child’s early years, childcare centers are growing in demand. Not only are childcare centers necessary for a child’s education and development, but the majority of families also use childcare while parents are employed or engaged in other activities. As Malaysia’s leading corporate service provider, 3E Accounting has helped many entrepreneurs launch successful businesses. We can now do the same for you.
Many programs or childcare services include an educational element like enrichment classes that will help the children to grow and learn. In addition, some programs include a parent component designed to educate parents through their participation in children’s activities. The mushrooming of childcare centers reflects the high demands of childcare services, especially in the big city.
Before you begin your childcare center venture, you need to think about several things:
- Operational hours and fee structure of the center.
- The location as well as the size and design of the center.
- The source of funding you intend to use for your childcare center business.
- Activities and curriculum for children at the childcare center.
What the Childcare Center Business Entails
A childcare center provides education and care for young children. The term could also mean supplemental care of children from birth to age eight years by persons other than parents. A childcare center is a place or business providing childcare services for working parents.
There are four categories of child care centers in Malaysia. When starting your own childcare practice, you need to decide which type of center you would like to specialise in. Here are the available niches to choose from:
Government-Owned Childcare Centers
These are referred to as the “Taska Dalam Komuniti” since 2006. MWFCD has been setting up community childcare centers in urban and rural areas to benefit low-income families in urban and rural areas with quality childcare services. Government-owned childcare centers will receive assistance from the Federal Government of the State Government. Families who send their children to community childcare centers will receive a monthly subsidy of RM180 per child if the family’s income is below RM2000 or RM1200 in urban and rural areas respectively. In addition to this, a grant of RM55, 000 will also be given to financially aid the establishment of a community childcare center.
Workplace Childcare centers
MWFCD also encourages the private sector to provide childcare facilities at the workplace for their employees. Incentives include a 10% tax exemption on the cost of building the childcare centers for a period of 10 years. Employers can find out more about the childcare center tax incentives at PEMANDU and the flexWorkLife.mytax incentives page.
Institution-Based Childcare centers
Generally, the Private sector or Non-Governmental Organisations (NGOs) establish this kind of childcare center. It would usually consist of 10 or more children under their care.
Home-Based Childcare Centers
You can carry out this form of childcare service in your own home. These types of centers would usually hold anywhere between four to nine children.
Even if you are starting a childcare center business that is based out of your own home, you must still abide by the regular practices expected of childcare centers.
The Business Registration Process
The Malaysia company registration process for starting a childcare business begins with registering with the Companies Commission of Malaysia. The commission is known locally as Suruhanjaya Syarikat Malaysia (SSM).
The Malaysia company incorporation process also requires every company to have a minimum of two directors who must be at least 18 years or older and residing in Malaysia. These individuals must not have been bankrupt in the past. It is compulsory for companies registered in Malaysia to have a registered office address. The address would need to be a commercial address and not just a PO Box number.
Since you are starting a childcare center business, you will need approval from the local authorities, Fire & Rescue Department, and Health Department for your premises. It is mandatory for all childcare centers to register with the Department of Social Welfare (DSW). The local name for the commission is Jabatan Kebajikan Masyarakat Malaysia (JKM) under the Ministry of Women, Family, and Community Development (MWFCD). Once the business registration process is complete, you will be issued a TASKA Registration Certificate. Here is a detailed guide to the Malaysia company incorporation process.
The Licenses and Permits You Need
The MWFCD is responsible for the approval and establishment of childcare centers in the country. The JKM acts as the main regulator and coordinator of Early Childhood Care & Education (ECCE) programmes. The Childcare center Act 1984 was passed to maintain the standards of childcare centers in the nation. Thus, every established childcare center must operate in compliance with the Act.
The Act covers issues on registration; monitoring and inspection of the childcare centers; and protecting the interests and safety of the children [against any negligence and abuse]. The Childcare center Act 1984 has then been reviewed and passed by the Parliament, giving rise to the Childcare centers (Amendment) Act 2007.
Keen to Starting a Childcare Center Business?
If you’re keen to open your own childcare center and begin nurturing young minds in Malaysia, we can help. For more information about our company incorporation services, contact us for further details.