What Should Be The Right Business Structure As A Startup In Malaysia?

The business entity you choose has operational financial and legal implications. It plays a huge part in company registration in Malaysia for foreigner if you come from a different country. It is prudent to choose the right structure of your business from the start. Discover which one suits your business the best.

 

Sole proprietorship

This kind of business structure you pick impacts the personal liability and the tax you or your business needs to pay. For instance, a sole proprietorship is the easiest to form and comes with fewer government regulations as well as tax obligations when you compare it to other business structures. It happens to be taxed at the personal level as you and your business are considered to be the same legal entity. This indicates that you are entirely responsible for your business capital, operation of the business, responsibilities of the business, and repayment of the debts of the business.

 

Company

When it comes to a company, it enjoys numerous perks and benefits that come with higher operational as well as compliance costs. The same is true with company registration Malaysia. It follows an elaborate and stringent procedure as compared to a sole proprietorship. The company is recognized to have a separate legal entity from its directors and shareholders by law. Unlike a partnership, when it comes to a company, the death of a business partner will not affect the legal personality.


Partnership

A partnership is managed by the partnership act 1961 indicating the maximum number of partners in a partnership should be 20. But, if the partnership is managed by any other written laws, such a limit does not apply. For instance lawyers, accountants, architects, and doctors. When it comes to Malaysia, the businesses making the most out of partnership structures are medium-sized and Small Enterprises. Company registration in Malaysia for foreigner is also simple when it comes to a partnership. They are relatively easy to form with your startup and compliance costs.

 

Limited liability partnership

Over the ages, the business industry has developed and brought new forms of an entity by combining the concepts and features discovered in traditional partnerships for forming a new concept called limited liability partnership. A limited liability partnership needs to have at least two partners but there should be no cap on the maximum partner number. The greatest advantage of forming a limited liability partnership is that it is a corporate body and comes with a separate legal personality when compared to its partners.

 

A limited liability partnership also has perpetual succession where any transformation or changes within its partners will not affect its existence. Even though the partners will not be personally responsible for the liabilities and debts of the limited liability partnership, they will still be liable if they commit a torturous wrong. Another distinctive characteristic of a limited liability partnership is that it exclusively needs to keep a fair and true financial statement.

 

Closure

Hiring a professional for company registration Malaysia can assist you with all the registration procedures and formalities and can also offer you advice for avoiding common mistakes and errors. Business owners will be capable of clarifying matters about taxes, compliance, and structure from the professionals before making a decision on which the business structure has to form.

 

There are various other documents to be prepared and filed with required authorities after registration which are usually unfamiliar by business owners and time-consuming. Thus, it is best to leave those tasks to the professionals so that you can concentrate on your business. So, if you are looking for company registration Malaysia, hiring a professional for choosing the right business structure is essential.

 

Location: Malaysia

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