Doing it simpler

Many people have been asking us, why is the government making it so hard to get our feet in Malaysia with the need of a local presence and the answer is not that hard to find which is to prevent fraud and to make sure that the business is providing growth to the economy, not bleeding it out.

Company Secretaries do not like or don't provide local presence as a short cut to do things and that they don't want to get into trouble with fraud. Some do offer a local entity to work as a proxy for yourself if you don't intend to stay here long for a hefty fee.

We do have a list of reliable local business persons who are established and act as your introducer and set bail for your Visa requirements and this is on a case-by-case basis. For local Bumiputera compliance, the person must hold 70% of the shares and for someone who is not from Singapore, the company must be paid up with at least RM350,000 or approximately USD120,000 in assets. Stamp duties must be prepaid and this must be done on a double transfer (or even triple transfer) basis which works to about 1.5% of the paid up amount which works to about USD2000 / RM7000 in all. Of course, time is money and KYC requirements of Bank Negara have been tighten since thus many are cussing and swearing at those budget changes.

Bail (non refundable) is set to be at least RM5,000 per person who required Visa and Expatriate Passes though the authorities do say it's 'refundable', in actual fact, they don't. Plus health care insurance requirements enforced this year means they require an additional RM2900 in insurance premiums annually just in case the foreigner have to be admitted to the hospital for an emergency and runs off without paying their bill. The 2011 Immigration Bill reading is putting a strain on many businesses which employs low skilled workers with denials for citizens of Bangladesh, India, Sri Lanka, Pakistan, Indonesia , Myanmar and Philippines. The minimum income requirement has been raised to RM8000 a month now or RM106,000 a year (USD40,000) with proven taxable income which has the Inland Revenue duties paid receipt (works to about 15% or about RM15,000 in tax due). It is cheaper for Muslims due to the lower tax rate imposed paid by tithes in lieu of Income Tax.

So how much will you have to pay to run a company now in Malaysia?
Approximately, these are the breakdown figures:

Local Company Director Fees : RM3000
Local Banking & Licensing Authorisation: RM2000 (plus any Fees by Councils)
Immigration Processing Fees : RM3500
Immigration Bail & Insurance : RM9000 (First Application)
Income Tax Witholding (ANNUALLY) : RM15000
Share Stamp Duties: RM7000
Credit Card Deposit *(Secured) : RM 40,000 (Preferred, so you can buy a car and house later on with good credit report)
Company Setup Fees: RM 15,000 (One Off, RM1 Million Authorised Capital)

It may sound VERY STEEP and EXPENSIVE but if you pay it properly, then there will be no additional fees incurred as many got stung by even the 'top company formation' teams.

To wrap off, here is the GUIDE PRICE:
Company Setup and Licensing: RM 20,000 including Licensing Fees
First Director & Banking Fees: RM5000
Shareholding Stamp Duties (If Proxy is used) : RM7000
Immigration Permits *(If you need them to 'legally work') : RM28,000 (*1st year inc IncomeTax)
Spouse and Family Permits *(If needed) : RM10,000 each (approx)

You see, the proxy is better off than to waste your money paying taxes and stuff like that since eventually, you still need their services. Many who opt to pay the high fees includes those who wish to be in Malaysia for at least 5 years since the expatriate pass will be granted on a 5 year basis and that they would usually be granted Permanent Resident Status for Gold Card holders.