What is Sdn Bhd Company?
Sdn Bhd, is an abbreviation of a Malaysian term Sendirian Berhad, which means a Private Limited company. This type of company is quite popular among businessmen in Malaysia.
According to the Companies Act 2016, Sdn Bhd Company can only be registered unless it has appointed 1 director and 1 shareholder. Meaning thereby, you can easily register a Sdn Bhd company in Malaysia without engaging a business partner.
Below are the noteworthy features of Sdn Bhd Company.
- This type of company is limited by share. Meaning thereby, if an Sdn Bhd company declares a total loss, the shareholders and company secretary of such a company won’t be liable to the company shares.
- Sdn Bhd Company holds the right to conduct its perpetual succession until shareholders, directors, or company secretary dissolves the company.
- All such companies can sue any other individual or company. Similarly, any other individual or company can also sue an Sdn Bhd company.
- Sdn Bhd Company is free to enter into contracts with other companies and perform legitimate business activities.
What is the Difference between Berhad and Sdn Bhd?
If you don’t have any idea as to what are the major differences between a Berhad (Bhd) and a Sendirian Berhad (Sdn Bhd) company, just take a look at the information provided below.
To start with, let’s discuss the names of these companies and their meaning. The term Sendirian Berhad (Sdn Bhd) means a Private Limited Company.
On the contrary, a Berhad (Bhd) company is a Public Company. Normally, public companies are listed on a stock exchange, rendering them as the public listed companies.
Given below are the most prominent differences between Sdn Bhd and Bhd companies.
1. Availability of the shares to the public
A public company (bhd) allows the public to own its shares without any prior permission. On the other hand, people can only own the shares of a private limited company (Sdn Bhd) after the approval or agreement of its existing shareholders.
2. Number of shareholders
A public company (bhd) is permitted to have an unlimited number of shareholders. Whereas, a private limited company (sdn bhd) cannot have more than 50 shareholders.
3. Publication of financial information
The financial information of a public company (Bhd) is accessible to the public. Moreover, public listed companies are also bound to hold quarterly earnings calls.
Such a company needs to answer the queries of its public shareholders. On the contrary, a private limited company (Sdn Bhd) isn’t required to the public its financial information.
4. Standards for financial reporting
The most notable difference between a private limited company (Sdn Bhd) and a Public company (Bhd) is related to their financial reporting standards. Public companies have to follow a higher financial reporting standard as compared to the private limited company.
How to Register a Sdn Bhd Company in Malaysia
Here is a step-by-step instruction about registering an Sdn Bhd company in Malaysia.
Step-1: Go to the online portal of MyCoID and register an account.
Step-2: After activating the account, you will receive an email, which provides essential information for validating the account at the nearest SSM counter.
Step-3: Once SSM validates your account, the next step is to login to the MyCoID portal and start the process of registering your Sdn Bhd company.
Step-4: Next, go to the Direct Incorporation Application to perform the Name Search procedure. To initiate this procedure, you need to provide the three proposed names for the company.
If another company has already taken the proposed name, it won’t be possible to proceed further with the registration process.
Step-5: After that, a Super Form will open on your computer screen. This form allows you to clarify the meaning of the proposed company name.
It is mandatory to fill this form if the proposed name contains the controlled words, names of states, or trademark. In this case, you are also bound to provide an authorization letter from the relevant authority or owner.
Step-6: Now it’s time to choose a business code. This is a code that provides both the business address and registered address of your company.
Step-7: Till this stage, the system will list you as a shareholder or director of the company. However, if you want to add these details manually, you can do it in the next step.
Step-8: Apply after carefully reviewing the information provided by you. From here, you will be directed to the ‘Transaction page’.
Step-9: For completing the registration procedure, you have to pay RM1,000 as a registration. Don’t forget to collect the transaction receipt.
Step-10: Once done, the ‘Notice of Registration’ will be sent to you via email. It would serve as proof of registration. In addition, you can also obtain a Company Certificate by paying the required fee at the SSM counter.
Note: After registering a company with SSM, you are bound to appoint a company secretary within 30 days. You can do it through MyCoID portal. Although it isn’t binding or mandatory to lodge a constitution of your Sdn Bhd company, you can do it via MyCoID portal if you want to.
What are the Requirements to Register a Sdn Bhd Company in Malaysia?
The most essential aspects to consider when registering an Sdn Bhd company in Malaysia are mentioned below:
- Name of the Company
- What type of business activities it would perform
- Must have a registered office in Malaysia
- The company should have one director and one shareholder.
- Need to hire a corporate secretary, who is either licensed by SSM or a member of a prescribed professional body.
- The lowest amount of paid-up capital is RM2
- You have to provide a copy of every essential document. For instance, copies of identification cards or passport of the director and shareholder must be attached to the file.
Eligibility Requirement for a Sdn Bhd Company
In order to run the company, it requires the appointment of at least 1 shareholder and 1 director who lives in Malaysia. Both the director and shareholder could be the same person.
- The age of both the shareholder and the director should not be less than 18 years old.
- Moreover, the person has not been convicted within the last five years.
- Bankrupt or a person not the resident of Malaysia isn’t eligible for such designations.
How long does it take to Register Sdn Bhd Company?
Generally, it takes 1 to 2 weeks for getting your Sdn Bhd Company registered. Below is the estimated time that each process might take for its completion.
- It takes 1 working day for competing for account registration & activation, as well as the “Company Name Search” procedure.
- You require 2-3 days for preparing the registration documents
- The signing of all the relevant documents by shareholders and directors can take 1 working day
- You need 3-5 days for submission of documents to SSM
- Obtaining the Digital incorporation certificate by SSM takes only 1 day
The time mentioned above is an estimated one, which means you may have to face delays if the SSM requires some kind of additional information. For instance, SSM might require additional time to verify the registration documents.
It is binding on the owner of a prospective company to carefully provide the information. This is so, as even the slightest mistake could result in an unexpected delay.
How much it takes to Register Sdn Bhd Company?
Here are the two major expenses of registering a Sdn Bhd company in Malaysia.
- The cost of registering Sdn Bhd RM1499
- The company secretary fee is RM200 per month
Company Secretarial Services
With a view to registering a Sdn Bhd company in Malaysia, you need to appoint a company secretary. A company secretary is responsible for performing a variety of essential tasks.
For instance, a secretary needs to:
- Deal with regulations
- Create company policies
- Handle the aspect related to the following industrial standards
- Follow up of the company’s guidelines and code of ethics
- Take into account any other regulations mentioned in the Malaysia Companies Act 2016
This is all about register a Sdn Bhd company in Malaysia. We hope you enjoyed the read. If you need