In fact, registering as a sole proprietorship can be as low as RM 60! But what is a sole proprietorship and why is it so popular? A sole proprietorship can be defined as a business that is owned and managed fully by one person. The owner, however, is at full liberty to hire employees as they please. In order to gauge why this legal structure is as popular as it is, it is good to look at the advantages it has. We will also take a look at the disadvantages in order to make a fair judgment.
Advantages of a sole proprietorship.
- It is easy to set up and takedown
- Has no corporate tax imposed?
- Owners have all the rights to management
- Registration fee is low
Disadvantages of a sole proprietorship.
- All debts incurred fall unto the owner
- The business is automatically shut down once the owner passes
Steps for registering a sole proprietor in Malaysia
As mentioned above, registration for this legal structure is very simple in Malaysia. In fact, not only can it be done online, it also requires only four steps!
Step 1- The business name
Naturally, the first step is to choose a name for your business. This can be the same name as presented on your identity card, or you may fill in a form for an official trade name. The latter requires RM 30 and the Form PNA 42 to be submitted.
Step 2- completing Form A
Once your name is approved, you will only need to file your application. This is done by filling in Form A. This requires all details pertaining to business registration Malaysia.
- The name of the business
- The type of business
- The date set in which the business is to begin commencement
- The official operating address of the business
- Owner’s details and information
Step 3- Filing the application
Now that you have completed the form, you may attach clear copies of your identification card to submit it. In addition, you will also need a document detailing your proposed activities for your business. If you have chosen to use a trade name, you must attach the approval certificate of it as well.
Step 4- Payment of Fees
Once you pay the stipulated fees, you will receive your license within a short period of time. Thus, officially making you an entrepreneur in Malaysia!
Now that we have covered the basics of registration, we may move on to the topic at hand. That is, Starting a business in Malaysia- Guidelines for the beginner!