How To Register a Sole Proprietorship or Partnership in Malaysia

Wondering how to register your business with Suruhanjaya Syarikat Malaysia (SSM)? So, to help you with this, below is a useful guide. By using registered business then we mean to segregate the same from the company and there after, look at its details in a better way for clarity.

Understanding the Basics ROC vs ROB

SSM has two entities that are responsible for registration and supervisory roles of different types of businesses. They are ROC (Registrar of Companies) and ROB (Registrar of Business).

• ROC (Registrar of Companies): The registry Sdn Bhd companies department ensures that all Sdn Bhd companies are registered correctly and keeps records of all corporate entities and their activities according to law.
• ROB (Registrar of Business): However, the ROB deals in the incorporation of firms, sole proprietorships, and partnerships. It concentrates on those business organizations which are of other nature than a corporation and keeps books for them.

Distinction in Registration:

• Sdn Bhd: Registered by the registrar of companies (ROC).
• Enterprise, Sole Proprietorship, or Partnership: Registered with Registrar of Business (ROB).
• SSM oversees all the registered businesses and companies on both ROC and ROB that operate under it.

Eligibility:

Registration of sole proprietorship and partnership with SSM is exclusively open to Malaysian Citizens and PR holders.

Compare Sole Prop vs Sdn Bhd

Registration Process

You can initiate the registration process for your business through either an SSM branch office or the convenient online platform at www.ezbiz.ssm.com.my.

For a more thorough and detailed comprehension, delve into the resources available for How to Create EzBiz Account & SSM Business Online Registration.

Necessary Documentation

To facilitate the registration, prepare the following documents:

• Photocopies of IC (front and back) for yourself and partners if applicable.
• For Sole Proprietorship: Solely your IC is required.
• For Partnership: IC copies of all partners.
• Fee Structure:
  • RM 30: Sole Proprietorship using your name as per IC.
  • RM 60: Sole Proprietorship with a trading name or Partnership.
  • RM 5 per additional branch (HQ not included).
  • RM 10: Printout of 1 Company Information copy (essential for bank account application).

Clarifying Common Queries

Obligation to Register:

• Operating a business without SSM registration is considered an offense, liable to fines up to RM 50,000 or a maximum of 2 years’ imprisonment, or both.

E-commerce Sellers:

• Selling on platforms like Shopee or Lazada constitutes a business activity, mandating registration.

Selling Used Items:

• Trading second-hand items as a business requires registration. Casual disposal of old items does not necessitate registration.

Sole Proprietorship and Partnership: Pros and Cons

Advantages:

• Low Cost: Cost-effective startup and maintenance.
• Easy setup: Hassle-free and straightforward process.

Disadvantages:

• Unlimited Liability: Personal liability for business debts, loans, and lawsuits.
• No Support System: Lack of guidance for tax filing and compliance. As it is not compulsory to appoint company secretary, auditor and tax agent.

Contrasting with Sdn Bhd Companies

• Costlier Registration: Sdn Bhd registration incurs higher expenses.
• Limited Liability: Company liability distinct from personal assets.
• Expert Advisory: Access to professionals for compliance and business optimization.

Making an Informed Choice

• Easy Registration vs. Credibility: The easy registration of sole prop and partnership might potentially diminish the perceived credibility of the business’s image.
• No paid up capital requirement: There is no paid up capital required for sole prop and partnership in Malaysia.

To learn more: Sole Prop vs Sdn Bhd

Conclusion

It is fundamental for your business to be registered as this is one crucial process which makes it legitimate and compliant. Choose what is right for your company’s prosperity. Come register via EzBiz SSM or contact FastLane Group now.