Compliance Requirements for Suruhanjaya Syarikat Malaysia (SSM)

1) Annual Return

After open company in Malaysia, within 30 days from the anniversary of their incorporation date, Private Limited Companies (Sdn Bhd) must lodge an annual return for each calendar year with the SSM consisting of general information for the following:

  • Registered office address
  • Business office address
  • Branch office address
  • Principal business activities
  • Total authorised capital registered
  • Total paid-up capital
  • Charges registered with SSM (i.e. company assets pledged)
  • Company directors
  • Appointed company secretary
  • Shareholders

Failure to comply with this requirement is an offence punishable with a fine not exceeding RM5000.00 and a further fine not exceeding RM1000.00 for each day the offence continues.

2) Audited Financial Statements

Company Directors are to prepare the company’s audited financial statements within 18 months from the date of its incorporation and, subsequently, within 6 months of its financial year end. These audited financial statements must be independently certified by government-approved auditors, and circulated to all Shareholders within 6 months of the financial year end, and, thereafter, be lodged to SSM within 30 days from when these statements are circulated to all Shareholders.

Malaysia has three types of approved accounting standards for the preparation of statutory financial statements:

  • The Malaysian Financial Reporting Standards (MFRS) – This is the MASB approved accounting standards for entities, but this does not include private entities
  • Private Entity Reporting Standards (PERS) – This is the MASB approved accounting standards for all private entities. However, this has been withdrawn effective 1 January 2016
  • Malaysian Private Entities Reporting Standards (MPERS) – This replaces the previous PERS and is in effect from 1 January 2016.

Failure to comply with this requirement is an offence punishable with a fine not exceeding RM5000.00 or imprisonment for a term not exceeding one year or both.

3) Director’s Report

Directors of a company will need to prepare a Director’s Report at the end of each financial year, which is attached to the company’s financial statements. It is basically a document to notify SSM of any material changes pertaining to information regarding:

  • Names and details of all current and past directors of the company.
  • The principal activities carried out by the company.
  • The net amount of profit and loss, basically this is your profit and loss sheet.
  • Shares or debentures
  • Any other information that might be required under the Companies Act 2016

Failure to prepare the directors’ report is an offence for the director(s) and punishable with a fine not exceeding RM500,000.00 or imprisonment for a term not exceeding one year or both. Failure to comply with this requirement is an offence for the company and every officer and punishable with a fine not exceeding RM20,000.00.

Compliance Requirements for Inland Revenue Board Of Malaysia (IRB)

1) Estimate of Tax Payable

Companies registered in Malaysia are required to determine and submit an estimate of their tax payable for a year of assessment 30 days before the beginning of the basis period. For example, if the financial period is 1 January 2018 to 31 December 2018, the estimate must be submitted before 30 November 2017.

Though no longer required to submit an estimate of tax payable from 2014, if they have no basis period for the current year and the following year, SMEs are advised to submit Form CP204 to notify the tax authority of their status to avoid penalty.

2) Revised Estimate of Tax Payable

Companies can revise and submit, if necessary, the estimate of tax payable in the sixth and/or ninth month of the basis period.

3) Income Tax Return

Companies are required to submit their tax return within 7 months from their financial year end, particulars of which include the amount of chargeable income and tax payable by the company. According to the IRB:

  • the estimated tax payable has to be paid in equal monthly instalments beginning from the second month of the basis period for a year of assessment
  • when a company has determined its actual tax payable, balance of tax which is the actual tax payable after deducting total instalments on the tax estimate, has to be paid within 7 months from the close of the accounting period
  • If a company fails to pay the monthly instalment on the tax estimate by the stipulated date, a late payment penalty of 10% will be imposed on the balance of tax instalment not paid for the month
  • If the difference between the actual tax payable and the estimated tax payable (if the revised estimate is not furnished) is more than 30 % of the actual tax payable, a 10% increase in tax will be imposed on that difference

Penalty for Late Payment

If the balance of tax payable is not paid by the due date, a penalty of 10% will be imposed on the outstanding amount. If the tax payable and penalty is still outstanding within 60 days from the due date, an additional penalty of 5% will be imposed on the tax and penalty outstanding.

Register Sdn Bhd

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