Starting a Sdn Bhd (Sendirian Berhad) is the Malaysian equivalent of incorporating a private limited company. It's the most common structure for serious businesses — used by tech startups, SMEs, agencies, and anyone who wants to separate personal and business liability.
What Is a Sdn Bhd?
A Sdn Bhd is a private limited company under the Companies Act 2016:
- Limited liability — personal assets are protected
- Separate legal entity — owns property, enters contracts in its own name
- Min 1 director + 1 shareholder — can be the same person (Malaysian residents or work permit holders only for directors)
- Min share capital: RM1 — RM1,000–RM100,000 is typical
- Mandatory Company Secretary — within 30 days of incorporation
Why Sdn Bhd Over Sole Proprietorship?
| Factor | Sole Prop | Sdn Bhd |
|---|---|---|
| Personal liability | Unlimited | Limited to share capital |
| Tax rate | Up to 30% (personal) | 17% first RM600k, 24% above |
| Credibility | Lower | Higher |
| Bank loans | Harder | Easier |
| Setup cost | RM30–60/year | ~RM1,500–3,000 one-time |
For freelancers, sole prop is fine. For serious ventures with employees or investors — Sdn Bhd.
Step-by-Step Registration
Step 1: Check Name Availability
Go to mycoid.ssm.com.my and search your proposed name. Have 2–3 alternatives ready. Names cannot be identical to existing companies or imply government affiliation.
Step 2: Prepare Documents
- IC/passport of all directors and shareholders
- Proposed company name
- Registered physical address in Malaysia
- Business nature description (SSM industry code)
- Share structure (number of shares, price, holders)
Step 3: Register via SSM MyCoID Portal
- Log in to mycoid.ssm.com.my with your MyKad
- Select "Incorporate a Company"
- Fill in company + director + shareholder details
- Upload documents
- Pay RM1,010 registration fee
- Submit — approval takes 1–3 working days
You receive a Certificate of Incorporation electronically. The company exists from that date.
Step 4: Appoint a Company Secretary (Within 30 Days — Mandatory)
Every Sdn Bhd must have a licensed Company Secretary. They:
- Maintain statutory registers
- File annual returns with SSM
- Prepare board resolutions
- Advise on compliance
Typical cost: RM500–1,500/year for a basic compliance package.
Step 5: Draft the Constitution (Optional but Recommended)
The Constitution governs internal company operations. Without one, the Companies Act 2016 default rules apply — fine for simple structures. Custom constitutions recommended for multiple shareholders or complex share classes.
Step 6: Open a Business Bank Account
Required documents:
- Certificate of Incorporation
- Constitution (if any)
- Directors' Resolution authorising account opening
- IC of all authorised signatories
Popular banks: Maybank, CIMB, RHB, Hong Leong, AmBank. Processing: 1–2 weeks.
Cost Summary
| Item | Cost |
|---|---|
| SSM registration fee | RM1,010 |
| Company Secretary (year 1) | RM500–1,500 |
| Constitution drafting | RM0–500 |
| Business bank account | RM0–50 |
| Total | ~RM1,500–3,000 |
Annual recurring: Company Secretary retainer (RM500–1,500) + SSM Annual Return (RM200).
Post-Registration Obligations
- Appoint Company Secretary within 30 days
- Register for PCB (monthly tax deduction) when hiring
- Register EPF, SOCSO, and EIS within 7 days of first hire
- Register for SST if annual taxable revenue exceeds RM500,000
- File Annual Return with SSM every year
- Hold AGM or pass written resolution annually
Common Mistakes
- Wrong business classification — affects tax incentives
- Residential address without property owner's written consent
- Not appointing company secretary within 30 days (fines)
- Ignoring annual return filing (late penalties compound fast)
- Mixing personal and company bank accounts
Key Links
- SSM MyCoID Portal: mycoid.ssm.com.my
- LHDN e-Daftar: ezhasil.hasil.gov.my
Part of Sorted — plain-language guides to every major life admin task in Malaysia. Information verified March 2026. Not legal advice.
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