Opening a Business in Malaysia
Become a key player in Southeast Asia's economic dynamism. A complete guide to structuring, registering, and propelling your business in Malaysia.
Partners & Key Institutions
Why Malaysia is the strategic hub of 2026?
In 2026, Malaysia has established itself as the essential pivot of ASEAN. Its central geographical position, between China, India, and Australia, makes it an unparalleled logistical and commercial platform. With stabilized GDP growth at 4.8% and controlled inflation, the country offers a stability that few neighbors can match.
The Malaysian entrepreneurial ecosystem has benefited from massive reforms aimed at the complete digitalization of public services. Today, administrative procedures are smoother than ever, attracting a new wave of international entrepreneurs eager to combine quality of life and professional opportunities.
- ✓ Market Access: Direct access to more than 660 million consumers through ASEAN free trade agreements.
- ✓ Infrastructure: State-of-the-art technology parks and generalized 5G connectivity.
Choosing the Right Legal Structure
The success of your project begins with a legal foundation tailored to your ambitions and capital.
Sdn Bhd (Private Limited)
This is the most common structure. It offers limited liability protection and full credibility with Malaysian banks and clients. Ideal for trade, services, and technology.
Labuan Company
"Asia's regulated tax haven."
- ● Reduced tax rate (3%)
- ● Easy 100% foreign ownership
- ● No tax on dividends
Sole Proprietorship
Reserved for citizens or permanent residents (PR). For expatriates, it is often inaccessible except in specific cases of spouse visas.
Representative Office
Test the market without direct commercial activity. Ideal for market research and prospecting before heavy investment.
Calculate prospecting costs
The Creation Journey: 7 Key Steps
01. Name Reservation
Your company name must be approved by the SSM (Suruhanjaya Syarikat Malaysia). It must be unique and not contain protected terms.
02. Appointment of Directors
A Sdn Bhd requires at least one director physically residing in Malaysia. In 2026, residency criteria are more flexible for holders of certain visas.
03. Share Capital
Although the legal minimum is 1 RM, a capital of 500,000 RM to 1,000,000 RM is often required to obtain work permits for expatriates.
04. MyCoID Registration
Registration is now done entirely via the MyCoID portal. Validation generally takes between 3 and 5 business days.
05. Bank Account Opening
Consult our guide on banks in Malaysia. This step requires the physical presence of the directors.
06. Specific Licenses (WRT)
If your activity involves retail or wholesale trade, a WRT license is mandatory for companies with majority foreign capital.
07. Taxation & Immigration
Finalize registration with the IRB (LHDN) for corporate tax and launch Employment Pass (EP) applications for your expatriate employees.
2026 Cost & Taxation Simulator
Estimate your initial investment and projected taxes.
Fee Estimation
*The SME rate is 17% on the first 600,000 RM of profit. Estimation based on 2026 tax laws.
The Tax Regime: Attractiveness and Equity
Malaysia practices a territorial tax system. Generally, only income generated in Malaysia is taxable. For a Sdn Bhd company, the standard Corporate Income Tax (CIT) rate is 24%. However, the government has maintained strong measures for Small and Medium-sized Enterprises (SMEs):
- Reduced Rate of 17%: Applicable on the first slab of 600,000 RM of annual profit.
- Sectoral Incentives: Companies operating in high technology, the circular economy, or agri-food can benefit from "Pioneer Status," offering a total tax exemption for 5 to 10 years.
- R&D Deductions: Double tax deduction for expenses related to certified research and development.
Note on Sales and Service Tax (SST)
In 2026, the SST is set between 5% and 10% depending on products and 6% for services. Registration is mandatory once your annual turnover exceeds 500,000 RM.
Where to invest in 2026?
Digital & Fintech
With the massive deployment of digital identity, payment solutions and cybersecurity are booming.
Global Halal Industry
Malaysia remains the world leader in Halal certification. An opportunity for exports to the Middle East.
Green Energy
The "National Energy Transition Roadmap" plan opens massive funding for solar and hydrogen.
Medical Tourism
The country welcomes more than 2 million foreign patients per year. See our Health in Malaysia section.
Recruitment and Social Obligations
💼 The Labor Framework
The Malaysian labor market is known for its flexibility. However, the Employment Act rigorously protects employees earning less than 4,000 RM/month. It is crucial to understand the local work culture to succeed in recruitment.
- Maximum 45 working hours per week.
- 11 mandatory public holidays per year.
🛡️ Social Contributions
Mandatory retirement fund for locals. Employer: ~13% / Employee: ~11%.
Workplace accident insurance. Mandatory for everyone, including foreigners since 2019.
Unemployment insurance managed by SOCSO.
Frequently Asked Questions (FAQ)
Can I own 100% of my company as a foreigner? ▼
What is the minimum capital required for a work visa? ▼
How long does it take to open a bank account? ▼
Do I need to have a physical office? ▼
What is a Company Secretary? ▼
Are there tax treaties with France, Belgium, or Switzerland? ▼
"After 10 years in Paris, I opened my tech consulting firm in Kuala Lumpur in 2024. The MyCoID process was disconcertingly simple. The hardest part? Choosing the neighborhood! But today, my team of 12 people reaches the entire Singaporean market from KL for a third of the operating cost."
Marc L.
Founder of Nexus Digital Solutions
Read other testimonialsReady to conquer the Malaysian market?
Don't let administrative doubts slow down your ambition. Download our complete checklist or contact our local experts.
Disclaimer: The information on this page is provided for general guidance and does not replace the advice of a licensed legal or tax expert in Malaysia.