Company formation in Malaysia is a secure way to conduct business in Malaysia and the Asia Pacific region. The following information will help you determine whether company formation in Malaysia is the optimum solution to meet your business objectives.

100% foreign ownership is permitted with company formation in Malaysia. Corporate directors are also allowed for company formation in Malaysia.

To support company formation in Malaysia, the country has signed double taxation treaties with almost 68 countries (see the Inland Revenue Board of Malaysia website).

Company formation in Malaysia is an ideal way to operate in the expanding Malaysian economy.

It is relatively easy to open a corporate bank account to support company formation in Malaysia. Healy Consultants works with internationally recognised banks such as HSBC, Standard Chartered and Citibank to provide corporate bank account services.

Laws have now been relaxed with regards to certain types of companies, in line with the Malaysian government’s efforts to attract foreign investment, making certain types of company formation process easier. Full (100%) foreign control in wholesale fund management firms is now allowed. The limit in foreign ownership for unit trust companies has been increased to 70%, and this limit for stock brokerages will be increased to from 49% to 70%.

Company formation in Malaysia attracts withholding tax of between 10% and 20%. For more information, refer to tax planning in Malaysia.

Under Section 145 (1) of the Malaysia Companies Act 1965, every Company must have two resident directors.

With company formation in Malaysia, a Company pays corporation tax of 25% on Malaysia-sourced income.

Following company formation in Malaysia, the Company must submit an annual tax return and audited financial statements.

Malaysia company formation is difficult for foreign investors, who are required to apply for Foreign Investment Committee approval when taking a Malaysian company shareholding exceeding 30%. As such, Malaysia is perceived negatively as the world’s 53rd freest economy in the Heritage Foundation’s 2012 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets.

Malaysia is negatively perceived as the world’s 60th least corrupt country, according to the 2011 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians.