HomeResourcesQuick guide to investing in Malaysia
Quick guide to investing in Malaysia

Quick guide to investing in Malaysia

Malaysia’s export-driven economy has benefited from not just a skilled, multilingual workforce, but also from its array of advanced, knowledge-based, and capital-intensive industries.

Top exports

Electrical and electronic products

Electrical and electronic products

Petroleum products

Petroleum products

Chemicals and chemical products

Chemicals and chemical products

Liquified natural gas

Liquified natural gas

Palm oil and palm oil agriculture products

Palm oil and palm oil agriculture products

Rubber products

Rubber products

How to set up a business in Malaysia

  • Steps
  • Details
Steps Details
Apply for incorporation under Suruhanjaya Syarikat Malaysia (SSM) and appointment of company secretary

Register the company name with the SSM. After approval, it will be reserved for 30 days from the day of confirmation.

Necessary documents and information needed:

  • Proposed type of business
  • Business address
  • Registered office
  • Complete details of directors

If successful, notices of approval and registration will be issued.

A company secretary will then be appointed.
Open a bank account

Documents required:

  • Completed bank forms
  • Incorporated company's rubber stamp
  • Photocopy of directors' and authorised signatory's identification cards
  • Certified true copy by the company's secretary, of resolution from the board of directors to open an account and a list of authorised signatories
  • All company incorporation forms
Application of necessary licences and permits from relevant authorities

Types of business licences:

  • General licences
  • Sector/industry-specific issues
  • Activity-specific licences
Start business

Commence business upon approval.
Steps
Apply for incorporation under Suruhanjaya Syarikat Malaysia (SSM) and appointment of company secretary
Open a bank account
Application of necessary licences and permits from relevant authorities
Start business

Taxes and incentives

Taxes
chevron

In Malaysia, the personal income tax stands at 15% while the standard corporate tax is at 24%. For SMEs, the standard corporate tax is at 17%.

Incentives that businesses receive are based on sectors, locations and company size – in various amounts and periods of time. Some of these incentives include:

Pioneer Status (PS)

  • For high-value tech manufacturers
  • Income tax exemption - ranging from 70% to 100% on statutory income for 5 to 10 years



Investment Tax Allowance (ITA)

  • Allowance of 60% to 100% on qualifying capital expenditure, to be used for approved projects incurred within 5 to 10 years



Pharmaceutical manufacturers in high-tech products

  • Income tax rate of 0% to 10% for the first 10 years
  • Income tax rate of 10% for the subsequent period of 10 years



Principal Hub

New company

  • Tier 1 – 0% tax rate for up to 10 years (5+5)
  • Tier 2 – 5% tax rate for up to 10 years (5+5)

Existing company

  • 10% tax rate for up to 5 years



MSC Malaysia Status

  • 100% tax exemption for 5 years (Tier 1 and 2) and extendable for another 5 years
  • 70% tax exemption for 5 years (Tier 3), extendable if a company is changed to Tier 1 or 2 and fulfils the conditions imposed



National Economic Recovery Plan

New company in manufacturing sector with fixed assets of:

  • MYR300–500 million: 0% tax rate for 10 years
  • >MYR500 million: 0% tax rate for 15 years

Further resources

Relevant government agencies
chevron

Malaysian Investment Development Authority (MIDA)
The government's principal agency to oversee and drive investment into the manufacturing and services sectors in Malaysia.

Visit MIDA’s website

Malaysia External Trade Development Corporation (MATRADE)
The national promotion agency under the Ministry of International Trade and Industry (MITI) to develop and promote Malaysia’s export to the global market.

Visit MATRADE’s website

Malaysia Digital Economy Corporation (MDEC)
The government agency under the Ministry of Communications and Multimedia Malaysia entrusted to lead the nation's digital economy forward.

Visit MDEC’s website

This fact sheet is given on a general basis without obligation and is strictly for information only. Nothing in this fact sheet constitutes accounting, legal, regulatory, tax or other advice. This fact sheet is not intended as an offer, recommendation, solicitation, or advice to purchase or sell any investment product, securities or instruments. Although reasonable care has been taken to ensure the accuracy and objectivity of the information contained in this fact sheet, UOB and its employees make no representation or warranty, whether express or implied, as to its accuracy, completeness and objectivity and accept no responsibility or liability for any error, inaccuracy, omission or any consequence or any loss or damage howsoever suffered by any person arising from any reliance on the information in this fact sheet.