Sole Proprietorship | Partnership | Limited Liability Partnership | Limited Liability Company (Sdn Bhd) |
Owned by 1 individual | Jointly owned by 2 – 20 individuals | Owned by at least 2 individuals | Owned by 1 – 50 shareholder(s) The ownership is transferable |
Liability extend to owner’s personal assets | Liability extend to each member’s personal assets | Members’ personal assets are protected from liabilities | Liabilities borne by director or shareholder are to the extent of unpaid shares only |
Less paperwork and less additional legal formalities (compare to LLP and Sdn Bhd) | Less paperwork and less additional legal formalities (compare to LLP and Sdn Bhd) | Must lodge annual declaration and solvency statement with SSM | Must file Annual Return and Financial Statement every calendar year |
No need to be audited | No need to be audited | Not compulsory to be audited | Need to be audited |
The business will be terminated if the owner died | The business continuity will be affected if one of the partners died | The company will exist even if the partner passed away | The company will exist even if the key director/ shareholder passed away |
Cannot enjoy the preferential tax rate given for small companies | Cannot enjoy the preferential tax rate given for small companies | Preferential tax treatment on first RM500,000 of chargeable income | First RM500,000 : 17% Subsequent : 24% * If Paid Up Capital less than RM2.5 Million |
Anyone doing business in Malaysia should register either in the form of Enterprise or Company with SSM not later than thirty (30) days from the date of commencement of business.
There is two (2) common forms of Enterprise and two (2) common forms of Company which are Sole Proprietor and Partnership as well as Limited Liability Partnership (LLP) and Private Limited Liability Company (Sdn Bhd).
The pictures above show the major different between each form of enterprise or company as well as the advantages and disadvantages for a SDN BHD.
For more information, you may refer to http://www.ssm.com.my/Pages/Home.aspx.
We do provide the service for incorporating a Company in Malaysia. Kindly refer to https://www.ycsaccounting.com.sg/our-services/malaysia/corporate-secretarial for details information. Please feel free to contact us at +607 – 225 4911 should you need more clarifications. Or you can just click HERE to contact us.
