What are the advantages of having new sdn bhd in Malaysia?

It is important to know the benefits and advantages of having new sdn bhd company  in Malaysia before making any decision.

The following are the advantages of having new sdn bhd company in Malaysia: 


Limited liability – personal wealth is protected

You, as the shareholder, is the partial owner of the company (depending on your shares) and do not responsible or liable for any liabilities of the company. The worst case scenario is you will lose all of your capital invested in the company, nothing more than that. (unless you have given any personal guarantee to any liability of the company) As such, start  your business by registering new sdn bhd in Malaysia without risking your personal wealth and assets.


Separate entity – Continuous existence

A company has the same rights and obligations as a natural person and it can acquire assets, enter into contracts, sue or be sued. Its separate legal allow it continue to exist even if founder, one or more shareholders or directors sell their shares, die or leave the company, until such time that the company is dissolved. While a partnership or sole proprietorship ceases to exist upon the death of its owner(s), the continuous existence of a company will give greater stability and ability to plan for longer term business goals.


Separate entity – Ownership transferable

You, as a shareholder of a sdn bhd company, can opt to sell or transfer, partially or entirely, your shares to any one (including your wife, family members or somebody who is willing to pay high price). You will be unable to sell or transfer your partnership or sole-proprietorship to anyone except selling the business. You will not be able to sell goodwill of a good business as the partnership or sole-proprietorship will be discontinued after the sale of business.


Lower corporate tax rates

Because sdn bhd company is taxed separately from their owners, and the corporate tax rate is generally lower than the individual tax rate. Currently, the corporate tax rate for companies (have less than 2.5 million share capital) are as follows:

  1. First RM500,000 profit – 20%
  2. Above RM500,000 profit – 25%

Maximum tax rate for individual is 26%.


Greater access to capital/fund

It is often easier for companies to raise money than it is for other forms of business. For example, while sdn bhd/berhad have the option of issuing bonds or share certificates to investors, sole-proprietorship/partnership must rely solely on their own money and loans for capital. This can limit the ability of a business to expand. Sdn Bhd Company is also often able to borrow money at lower rates than those paid by other types of businesses, simply because financial institutions and others tend to see loans to companies as less risky than those given to other forms of enterprise.


Comment from Author:

It is important to know the benefits and advantages of having new sdn bhd as compared to those of sole-proprietorship/partnership. In order to achieve in greater height and long term goals in your business, it will be wise to get one today!


Register New Sdn Bhd Company at RM1,060 only! Call us now!