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Sole Proprietorship

What is Sole Proprietorship?

Sole Proprietorship registration is the most common and simplest legal business structure option in Malaysia. Sole Proprietorship is governed by Companies Commission of Malaysia (Suruhanjaya Syarikat Malaysia) and  Registration of Businesses Act 1956 .
A Sole Proprietorship is a business wholly owned by a single individual using personal name as per his / her identity card or trade name. To register a Sole Proprietorship, the business owner must be Malaysian citizen or permanent resident. Foreigner and corporate legal entity are not allowed to register sole proprietorship in Malaysia.
Unique features of a Sole Proprietorship like fast and easy registration, no corporate tax payments, less formal business requirements, winding up easily and lowest annual maintenance (Compare to other business vehicle such as Private Limited Company (Sdn. Bhd.) or Limited Liability Partnership).
It is suitable for newly start up business owners to try their new business strategy or explore into new market. Business owners may subsequently transform their business into Private Limited Company (Sdn. Bhd.) if they feel their businesses are stable/ aim to do bigger business. Sole Proprietorship will transform to Partnership if there are additional partners joined the Sole Proprietorship.

Procedures for Sole Proprietorship Registration

All business owners must visit Companies Commission of Malaysia (SSM) personally to register their Sole Proprietorship. Secretarial firms are not able to register Sole Proprietor / Partnership on behalf of business owners/partners.
Business owners shall personally visit Companies Commission of Malaysia (SSM) too if they wish to change their business details / renew or close their Sole Proprietorship and Partnership. As such, we are not able to help you register your Sole Proprietor or Partnership on behalf in Malaysia.
The following are the procedures to register Sole Proprietorship in Malaysia:
Complete SSM Form Conduct Name Search Pay Annual Fee Your Company Is Ready
You need to visit nearest SSM with your photocopy IC and fill in the business registration form. It can be obtained at SSM counter SSM officer will check on availability of your proposed business name Once everything confirmed, you need to pay your annual fee as follow:
a) Trade name – RM60 per year
b) Personal name – RM30 per year
c) Branch (s) – RM5 per year each
The business registration certificate can be obtained at SSM counter within 1 hour after payment made

Information Required for Sole Proprietorship Registration

  • Copy of business owner identity card (I/C)
  • Proposed business name
  • Proposed nature of business of the proposed business
  • Proposed business address
  • Letter of approval from Government Agency (if applicable)

Advantages of Sole Proprietorship

There are multiple reasons to choose Sole Proprietorship:
You are the Boss No Corporate Tax Payments Lowest Annual Cost
A Sole Proprietor has complete control and decision-making power over the business. All profit will go to business owner pocket directly. Sole Proprietorship is not a legal entity, all its chargeable income will be taxed at business owner personal income tax. Compare to Private Limited Company (Sdn. Bhd.),Limited Liability Partnership or Partnership, Sole proprietorship has the lowest annual maintenance cost.
Less Formal Business Requirements Winding Up Easily Minimum Entry Requirements
Most of the Sole Proprietorship are micro or small business owners, there are lesser rules & regulations need to be complied by Sole Proprietorship (e.g. Exempt from preparing audited report). You can visit SSM to close your Sole Proprietorship immediately or your Sole Proprietorship will be closed automatically if you did not pay your annual fee on time. Sole Proprietorship is the most common and simplest business vehicle in Malaysia, any Malaysian citizen or Permanent Resident can register it themselves easily.

Factors to Consider in Sole Proprietorship Name Selection

The name of your company is very important. It is the first impression to your buyers, suppliers and stakeholders. It should, therefore, be relevant, suggestive and attractive. There are various factors that you should keep in mind while naming for your company
Short & Simple
The name should be concise and not be too long. People should be able to pronounce it easily and they should be able to remember your company’s name the first time they hear or read it.
The name of your company should be related to your business. It should fit the company’s branding and corporate identity.
Name of your company should not be same or identical to an existing company or trademark. You can go to to check if your company name is identical to others. You should ideally avoid plural or changing just letter Case, spacing or punctuation marks in an existing company name.
Should not be illegal / offensive
The name of your company should not be against law. It should not be abusive or against the customs and beliefs of any religion.

What We Can Help You?

We are one of the recognized accounting firm located at Johor Bahru (Johor), Wilayah Persekutuan (Kuala Lumpur) and Penang Island (Penang), Malaysia that provide one-stop financial report compliance services, which includes bookkeeping, accounting, company secretarial services, tax preparation services, business consultancy and etc.
Our group of companies include licensed Secretarial Firm that registered with Chartered Secretaries Malaysia (MAICSA) in Johor Bahru (Johor), Wilayah Persekutuan (Kuala Lumpur) and Penang Island (Penang), Malaysia. This allow company (e.g. Sdn. Bhd.) registered in Malaysia engage us as their company secretary to assist them in compliance with Malaysia statutory requirements.
Our experienced staff will assist client with:
  • Act as named company secretary for your company to communicate, prepare, submit of statutory returns with the Companies Commission of Malaysia (SSM) in compliance with statutory requirements under Companies Act 2016.
  • Prepare resolutions required by company board of directors and attend your board meeting if required.
  • Prepare your company financial report compliance with Malaysia rules and regulation, include GST, MPERS, MFRS and etc.
  • Provide professional advice related to your business set up, operation and Malaysia rules compliance, include company incorporation, accounting, payroll and etc.
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What Our Client Say

L & Co always carry their services in professional way – well planning, in time, precise, friendly and professional. While we are stuck with problems, they can always advice us with industrial best practices and their views.
YM Tan
ICT Automation (M) Sdn Bhd

L & Co Plt.

18A & 20, Jalan Sasa 2,
Taman Gaya,
81800 Ulu Tiram,
Johor, Malaysia.

Tel +607-859 0410
Fax +607-863 1003
Kuala Lumpur
15-2, Dinasti Sentral,
Jalan Kuchai Maju 18,
Off Jalan Kuchai Lama,
58200 Wilayah Persekutuan,
Federal Territory of Kuala Lumpur.
Tel +603-2780 3885
Fax +603-7972 0007
S1-3, 1-21-01,
Suntech @ Penang Cybercity (1575),
Lintang Mayang Pasir 3,
11950 Bayan Baru,
Penang, Malaysia
Tel +604-377 7075
Fax +604-619 2699
  External Audit   Income Tax Submission   GST Consultancy   Tax Incentive Application   Corporate Advisory   Income Tax Audit   GST Submission  
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