Can Singaporeans Own a Company in Malaysia?

Yes. Singaporeans can legally own 100% of a Malaysian company in most industries.

Malaysia does not impose general shareholding restrictions on foreign nationals for standard commercial activities such as:

  • Trading

  • Consulting

  • Technology services

  • E-commerce

  • Manufacturing (subject to licensing)

However, ownership is only one part of the setup. Control, compliance, and operations require careful planning.

What Type of Company Should Singaporeans Register?

For Singaporeans, the most common and practical structure is:

✔ Sdn Bhd (Private Limited Company)

A Malaysian Sdn Bhd allows:

  • 100% foreign shareholding

  • Limited liability

  • Local operational presence

  • Ability to hire staff and apply for Employment Passes

  • Contracting with Malaysian customers and suppliers

Other structures (branch office, representative office) are more restrictive and less flexible for revenue-generating activities.

Key Legal Requirement: Local Resident Director

While Singaporeans can own 100% of the shares, Malaysian law requires:

👉 At least one director who is ordinarily residing in Malaysia

This is a statutory requirement under the Companies Act 2016.

What This Means for Singaporeans

  • You do not need to relocate to Malaysia immediately

  • You cannot use a Singapore address to satisfy the director residency rule

  • You must appoint:

    • A Malaysian resident director, or

    • A professional nominee director

Nominee Director: What Singaporeans Need to Know

Many Singaporean companies use nominee directors, but this must be done carefully.

Purpose of a Nominee Director

  • Fulfil legal residency requirement

  • Allow incorporation without relocating

  • Support interim operations

Important Risks

  • Directors carry legal duties and liabilities

  • Improper arrangements may expose shareholders to disputes

  • Poorly structured nominee agreements are a common mistake

💡 A professional firm ensures nominee arrangements are legally documented, transparent, and risk-managed.

Paid-Up Capital: What Works for Singapore Businesses

Legally, Malaysia allows incorporation with RM1 paid-up capital.

However, for Singapore-owned companies:

  • Banks expect realistic capitalisation

  • Employment Pass applications assess capital strength

  • Regulators and partners assess credibility

Practical Guidance for Singaporeans

  • RM10,000 – RM50,000: Small operating companies

  • RM100,000+: Companies hiring staff or applying for visas

Paid-up capital can be increased later, but starting too low often causes delays.

Do Singaporeans Need to Live in Malaysia?

No — but there are important distinctions.

Scenario 1: Shareholder Only

  • No need to live in Malaysia

  • No visa required

Scenario 2: Director / Active Management

  • Employment Pass or appropriate visa required

  • Subject to immigration rules

Operating without the correct visa can result in serious penalties.

Banking Challenges for Singapore-Owned Companies

Corporate bank account opening is often the biggest challenge for Singaporeans.

Common issues include:

  • Low paid-up capital

  • Lack of local presence

  • Unclear business activities

  • Incomplete documentation

💡 Proper structuring at incorporation stage significantly improves banking success rates.

Tax Considerations for Singaporeans

A Malaysian Sdn Bhd:

  • Is taxed as a Malaysian resident company if management is exercised in Malaysia

  • Must comply with Malaysian corporate tax laws

  • May trigger cross-border tax considerations

Singapore companies expanding into Malaysia should consider:

  • Transfer pricing

  • Withholding tax

  • Double taxation agreements (DTA)

Professional advice is strongly recommended.

Common Mistakes Singaporeans Make

❌ Assuming Malaysia rules are the same as Singapore
 ❌ Using RM1 paid-up capital for active operations
 ❌ Appointing informal nominee directors
 ❌ Ignoring post-incorporation compliance
 ❌ Underestimating banking and visa requirements

These mistakes often lead to delays, account rejections, or compliance exposure.

Why Singapore Companies Choose iComSec

iComSec specialises in cross-border Malaysia–Singapore company setups, offering:

  • Singapore-friendly incorporation solutions

  • Licensed company secretaries

  • Nominee director services

  • Ongoing compliance management

  • Practical, not theoretical, advice

We understand how Singapore businesses operate — and how Malaysia regulates.

 

Frequently Asked Questions (FAQ)

Can a Singapore company own a Malaysian Sdn Bhd?
 Yes. Corporate shareholding is allowed.

Do Singaporeans need a Malaysian partner?
 No, not for most industries.

Can everything be done remotely?
 Yes, with proper documentation and professional support.

 

👉 Are you a Singaporean planning to set up a company in Malaysia?
 Speak to iComSec today for a confidential consultation and get a Malaysia structure that works for your business  legally and commercially.