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PRIVATE LIMITED COMPANY

July 28, 2023

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PRIVATE LIMITED COMPANY

What is Private Limited Company (Sdn. Bhd.)

Private Limited Company is the popular choice among company owner for formation of company. Specialty about Private Limited Company is the creation of separate legal entity between owner and the company. In the absence of a dissolution by the Board of Directors or Shareholders of the Company, the Company may acquire property, incur debt, enter into contracts, file or receive legal proceedings on its behalf, and continue in existence in perpetuity.

Advantages of starting a Private Limit Company in Malaysia

  • Limited liability. Company owner assets are saved from company debts or loss.
  • Foreign ownership. For the majority of company activity, foreign equity can own a corporate entity at 100%.
  • Transferable shares. Directly can issue additional share to existing or new shareholder.
  • Attractive tax rate. Low corporation tax rates are applied to Private Limited Companies.
  • Reputation. In Malaysia, a limited corporation has greater credibility than other types of organizations.

 

What is required to form a Private Limited Company

  • A unique company name. The firm name must be original and unheard of elsewhere.
  • At least one shareholder. There must be a foreign or local individual or corporate entity.
  • A resident director. A minimum of one director with a primary residence in Malaysia.
  • A company secretary. The applicant must be a Malaysian citizen who meets the requirements.
  • Address in Malaysia. A local registered business address (Company operation office address).

 

Steps to starting a Private Limited Company

  1. Name search. Performing a name search for a firm at SSM to see if the suggested company name is available.
  2. Company registration. Registering a company in Malaysia with assistance of licensed company secretary recognized by SSM.
  3. Opening a corporate bank account. In Malaysia, you can open a bank account with any local or foreign bank.
  4. Obtaining permits and licenses according to the business nature (Depending on the nature of your services and products, this may or may not apply to your firm).
  5. Obey the corporation tax filling requirement with licensed tax agent recognized under Inland Revenue Board (LHDN).
  6. Perform annual filling to government such as SSM Annual Return (AR), Financial Statement (FS).

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CP 58

February 2, 2024

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What is CP58 ?   CP 58 form is not a tax filing form. It is an income statement that shows the income of incentives, allowances, bonuses, etc. for agents, dealers and distributors, similar to the EA form received by employee. Pursuant to Section 83A(1) of the Income Tax Act of 1967, as of January 1, 2012, each company must prepare and provide the CP 58 form to its agents, dealers and distributors (hereinafter referred to as agents) by March 31 of each year in accordance with the format required by LHDN.   Who are required to file CP58 form? The Inland Revenue Board of Malaysia (IRBM) stipulates that if the company pays more than RM5,000 in cash or non-monetary incentives to the agent during the calendar year, they must prepare the CP58 form for each agent. These forms do not have to be submitted to the tax office, but if the tax office requires all information on the rewards paid, the company must provide all incentive payment information, including awards worth less than RM5,000.   What rewards must be reported? The agent’s reward payments for achieving performance are mainly divided into two categories: cash reward & non-cash incentives. Cash Reward includes basic allowances, commissions, or bonuses. If the company provides cash incentives to the agent, it must report the actual amount paid in the CP 58 form. Material non-cash incentives includes incentives, tour packages, tickets accommodation, car, house and so on. For non-cash rewards, the company must prepare the CP 58 form based on the actual cost.   Which rewards do not have to be reported? Trade discounts and bulk discounts provided by the company Promotional items or gifts which are not stated in the agency contract Incentives given for an open invitation to encourage the public or customers to introduce more customers Provide special discount rates to independent agents Subcontract payment Handling fee Credit rebate Free items that are not based on performance, such as umbrellas, pens, and calendars   When is the due date to provide CP 58 form? The Form CP 58 shall be provided to the agent, dealer, or distributor not later than 31 March in the year immediately following the year in which the incentives mentioned above are paid.

股东协议

January 26, 2024

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什么是股东协议? 股东协议是一份拥有法律效应的合同,规定了公司的运作,并明确了该特定公司股东的权利和责任。 是否必须拥有股东协议? 在马来西亚,是否得拥有股东协议并不是法律上的要求,但建议公司制定一份股东协议,以保护所有股东的利益,并确保公司的顺利运营。此外,拥有股东协议可以更容易吸引潜在投资者,因为它表明公司拥有清晰和有组织的结构。 拥有股东协议的重要性 股东有能力审查公司的财务记录,因此股东可以在企业事务上做出明智的决策,而不是凭空做出可能对企业有害的判断。 股东投票权的透明度。 确保股份的所有权得到适当的管理。 安排业务的运作方式。   为什么公司需要股东协议? 提供股份转让的规定。 保护多数股东和少数股东的权益。 提供红利政策。 明确所有权和控制权。 设定决策程序。 管理红利和分配。   如果一家公司没有股东协议会有什么后果? 股东和公司都会面临未来的潜在纠纷。 缺乏协议可能导致僵局情况,导致股东无法解决分歧。 如果其中一位股东表现不合理,或者是其不当行为而引发争议。

Depreciation

January 18, 2024

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What is Depreciation ? Accumulated depreciation is the total depreciation for a fixed asset that has been charged to expense since that asset was acquired and made available for use. The intent behind doing so is to approximately match the revenue or other benefits generated by the asset to its cost over its useful life Types of Depreciation ? 1.Straight-Line  It reports an equal depreciation expense each year throughout the entire useful life of the asset until the entire asset is depreciated to its salvage value.   2. Declining Balance This method where assets are depreciated at a higher rate in the initial years than in the subsequent years. Under this method, a constant depreciation rate is applied to an asset’s (declining) book value each year.   3. Double-Declining Balance  This method is an approach to accounting that involves depreciating certain assets at twice the rate outlined under straight-line depreciation. This results in depreciation being the highest in the first year of ownership and declining over time.   4. Sum-of-the-Years’ Digits (SYD) Under the SYD method, the depreciation rate percentage for each year is calculated as the number of years in remaining asset life for the same year divided by the sum of remaining asset life every year through the asset’s life.   5. Units of Production This method requires an estimate of the total units an asset will produce over its useful life. Depreciation expense is then calculated per year based on the number of units produced.   What is Accumulated Depreciation ? Accumulated depreciation is the total depreciation for a fixed asset that has been charged to expense since that asset was acquired and made available for use. Presentation of Accumulated Depreciation Accumulated depreciation appears on the balance sheet as a reduction from the gross amount of fixed assets reported. It might be list in several accumulated depreciation accounts, one for each fixed asset type.