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Common Problems Foreigners Face When Doing Business in Malaysia
Due to its booming economy and low business costs, Malaysia has become one of the favorite investment locations for foreign investors. However, doing business in Malaysia may not be as easy as we think, and some procedures and steps must comply with Malaysian laws. The following is a list of problems that foreigners often encounter when starting a business in Malaysia:
FAQ 1: It is difficult for foreigners to open a corporate bank account
Generally speaking, foreign companies or foreign investors can open a company bank account in Malaysia. This should not be difficult technically, but different banks may have different rules and requirements. If you plan to invest or start a business in Malaysia, we recommend that you work with a reputable company (such as our accounting company) to help you open a company bank account.
Common problem 2: It is difficult for a new company to apply for a work permit
Another common problem is that foreign investors find it difficult (or impossible) to apply for a work pass under the name of their new company. In fact, the Malaysian Investment Development Authority has developed several different visa options for entrepreneurs, depending on the specific situation. If you are only in Malaysia for pre-opening investigations and exploring business options, you can apply for a short-term visit pass (social). If you are sure you will stay in Malaysia for two years, you can apply for a visit pass (temporary employment).
If you plan to stay in Malaysia for a long time, the Malaysia My Second Home (MM2H) program is a good choice.
FAQ 3: Confused about the requirements for setting up a 100% foreign-owned company
In Malaysia, foreigners can fully control 100% of a foreign-owned private limited company (Sdn. Bhd.), but there are some restrictions when setting up the company.
Below is a snapshot of the minimum requirements for setting up a 100% foreign-owned private limited company (Sdn. Bhd.):
Paid-up capital: RM1 million
License requirements: Retailers, traders (import and export), distributors, restaurants, franchisees, service and consulting operators Service and consulting operators are required to apply for a Wholesale and Retail Trade (WRT) license.
If you set up a consulting company, the paid-up capital is only RM1 and there is no need to apply for a WRT license.
However, we understand that the road to starting a business is difficult. If you do not have the required paid-up capital to start a business in Malaysia, don’t worry, we can help you with the issues and licensing requirements. In fact, we have helped many clients start a business in Malaysia with only RM1 paid-up capital. Some foreign investors may face difficulties in increasing their paid-up capital. With our assistance, you can easily increase your paid-up capital to RM1 million or more.
In addition, all companies doing business in Malaysia are required to file tax returns, regardless of whether they are resident entities. A foreign-owned private limited company (Sdn. Bhd.) can hire a licensed tax agent to assist in filing returns, depending on the year of assessment.
A company is a Malaysian tax resident if at any time during the year of assessment, its management and control is exercised in Malaysia. Regardless of where the company is registered, the directors are deemed to be exercising management and control when they meet to discuss the company's business (or affairs). The management and control of a company's business depends on how the company is managed. In short, obtaining a certificate of residency is not as difficult as many people think. What's more, our professional team can help you apply for a Malaysian certificate of residency in a hassle-free manner.
Finally, no matter what your nationality is, you can easily run a business in Malaysia and fully manage your company and corporate bank accounts. Our job is to provide the best service to help your Malaysian company succeed!