Thinking of starting a business in Malaysia? Choosing the right business structure is one of the most crucial steps in building a successful and sustainable company. Among the available options, the Private Limited Company (Sdn Bhd) is the most popular and recommended choice for business owners and entrepreneurs.
In this article, we’ll explain what an Sdn Bhd company is, the key benefits of registering one, and why it could be the best decision for your business.
What is a Private Limited Company (Sdn Bhd)?
A Private Limited Company (Sdn Bhd) is a legal business entity incorporated under the Companies Act 2016 in Malaysia. It is a separate legal entity from its shareholders and directors, meaning the company can own assets, enter contracts, sue, or be sued in its own name.
An Sdn Bhd company requires:
- A minimum of one director and one shareholder
- A registered business address in Malaysia
- A company secretary licensed by the Companies Commission of Malaysia (SSM)
Benefits of Registering a Private Limited Company (Sdn Bhd)
1. Lower Tax Rates
Sdn Bhd companies benefit from various tax advantages in Malaysia, including:
- Lower corporate tax rates for SMEs (first RM150,000 taxed at 15%)
- Eligibility to apply for pioneer status, tax exemptions, and other government incentives
2. Limited Liability Protection
The most significant advantage of an Sdn Bhd company is limited liability. Shareholder's personal assets are protected and they are only liable for the company’s debts and losses up to the amount they invested.
3.Separate Legal Entity
Your Sdn Bhd company operates as a distinct legal entity. This ensures clear separation between the company’s finances and your personal assets, providing better legal protection and corporate governance.
4. Better Access to Business Financing
Private limited companies are generally preferred by banks, investors, and government agencies when it comes to business loans, grants, and funding opportunities. This structure increases your chances of obtaining financial support.
5. Professional & Trustworthy Image
An Sdn Bhd status enhances your company’s professional image. It builds credibility and trust among customers, investors, suppliers, and financial institutions, making it easier to secure business deals and partnerships.
6. Perpetual Succession
The existence of an Sdn Bhd company is not affected by changes in ownership or management. This ensures long-term stability and continuity of business operations.
7. Easy Transfer of Ownership
Ownership in an Sdn Bhd company can be transferred by selling shares, making it convenient for business expansion, restructuring, or succession planning.
Is Sdn Bhd Right for You?
If you are serious about growing your business in Malaysia, registering an Sdn Bhd company is a strategic and future-proof choice. It offers the right balance of legal protection, credibility, and financial flexibility to help your business thrive.
How We Can Help?
At TAN ACCOUNTING ADVISORY, we specialize in Sdn Bhd company registration, accounting, and compliance services. Our experienced team will guide you through the entire incorporation process and ensure your business is fully compliant with Malaysian laws.
✅ Free Consultation | ✅ Fast & Hassle-Free Registration |
✅ Professional Advisory & Support
Contact us today and take the first step towards building your successful business.