Variations Between SDN BHD and Enterprise for New Company Registration Malaysia

Acknowledging the variations between SDN BHD and enterprise assistance to make the best decision that suits your business after new company registration Malaysia.

One of the commonly asked questions to the entrepreneurs looking forward to starting a new company or company registration Malaysia is whether or not to register as an enterprise or to add as SDN BHD.

In regular practice, it is popular for various entrepreneurs to begin their business utilising enterprise title before choosing to set up an SDN BHD various years later. Let us consider that you have registered your business as an enterprise and you are not sure of the benefits of an SDN BHD. Here are the points you need to follow.



Rules and regulations for Both Concerning Company Registration Malaysia

Considering from a legal point of view, an enterprise happens to be regulated under the registration of the Business Act 1956. It comes with no legal status and the business and the owner are considered as a single entity. Therefore, you personally will be liable for the debts incurred within your business.

Alternatively, when it comes to an SDN BHD, it happens to be regulated by the companies act 2016. It is considered like a separate legal entity with restricted liability and is able to earn incomes, sign contracts, own properties as well as sue and gets sued. This separates your liabilities.

Compliance with rules and regulations

An enterprise needs daily renewal with the registrar of business for keeping the business operating smoothly. But when it comes to SDN BHD no renewal is needed as there are further compliance requirements from SSM like:

●       Lodging the annual returns along with audited financial statements each year.

●       Appointing the company secretary within a month of sdn.bhd incorporation.

●       Updating company data like shareholders and directors details, registered address and paid up capital.

 Apart from that both SDN BHD and enterprise are needed to adhere to the statutory requirements of governmental authorities like EPF, business licence application, tax filing and more after new company registration Malaysia. 

Management and ownership

When it comes to an enterprise you can either manage and own a sole proprietorship or share the ownership as well as responsibilities with twenty business partners. Apart from the business owners, you can also higher professionals to manage your business under the enterprise.

As far as an SDN BHD is concerned it is owned by shareholders who add to the paid up capital of your company and the directors manage the same. You happen to be the sole shareholder as well as director of the SDN BHD company without a business partner.

For company registration Malaysia it is important to keep this in mind if you are going to register your company as an SDN BHD. The limit of the shareholders can also be increased by converting the structure of the SDN BHD into a public company.

These are some of the rules and regulations and the points you need to keep in mind for new company registration Malaysia that will help you differentiate between enterprise and an SDN BHD.


Location: Malaysia

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