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Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Old Feb 8th 2020, 12:08 pm
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Default Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

I was asked in a Facebook group to share about the experience of setting up a company in Malaysia in order to work under the LTSVP. I thought the information might be useful to some folks on here too so attaching the same post below...




First a bit about why I needed to do this. I had previously worked for an international company under the LTSVP, they have a local office and a local entity (Sdn Bhd company). I was employed by them for about 7 years. When that employment came to an end, I was lucky enough to find a part time contract with an overseas company but they had no local office here in Malaysia.



I enquired about updating my LTSVP to show that I was now working for the new company, but the immigration officer said they couldn’t do it because the employment contract has to be with a local company in Malaysia.



To solve this problem I looked at setting up a local company myself so that the contract could then be carried out by the company and I would pay myself a salary from that contract revenue while also covering company admin costs from the revenues.



I found a good company secretary/accountant who was able to help me. The total setup cost was a few thousand RM, and the ongoing costs for Company Sec etc. are a few hundred a month including subscription to the accountancy software package.



Once the Sdn Bhd company was setup I was able to draft an employment contract and get it stamped. I also had to provide photographs of the companies office (we decided to use the company sec’s office as the main address).



I’m not aware of any minimum salary requirements that had to be met.



There was a checklist of documents that were needed to register the employment status, it included the SSM registration docs (SuperForm) and stamped employment contract.



We dropped the documents at Immigration in the morning and waited quite a while until they closed the office for lunch. So we went off for a while and came back when the office re-opened, we then had to wait a few more hours before getting my passport back with the employment status updated.



Setting up payroll took even longer as we had to visit KWSP and PERKESO offices to get file numbers for the company and then LHDN was all done online.



Setting up bank account(s) was another step that involved some effort as we needed board resolutions done by the company secretary.



All in all I estimate we must have spent a good week or even 10 days of effort getting everything done.



I had my wife also be a company director and shareholder in the company.



We did not need a large amount of ‘paid up’ capital as we are not applying for any Employment Passes.



Let me know if any questions and I’ll try to answer.









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Old Feb 11th 2020, 9:15 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Why didn’t you apply for RP-T?
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Old Feb 11th 2020, 9:22 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Talent Pass is only available to those who are currently on an EP (my friend works at Talent Corp and I checked with her).

As I'd been on the LTSVP for many years I was not eligible for RP-T. I would have to first go back onto an EP for some period of time and then apply.

I don't want to do that through my own company due to the 'paid-up' capital requirements.
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Old Feb 12th 2020, 1:37 pm
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Ah I see
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Old Feb 12th 2020, 1:39 pm
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

If I'd known all this a while ago I would have made different decisions I guess :-D
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Old Feb 14th 2020, 2:44 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Two questions.

Doesn't the establishment of a company require "paid up capital" of a substantial amount?

Doesn't the management have to consist of Malaysians, at least in part. Is your wife Malaysian? Thus you'd have two Malaysian partners (your wife and the accountant)? Don't they own a certain amount of the company?
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Old Feb 14th 2020, 3:04 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Originally Posted by RedApe View Post
Two questions.

Doesn't the establishment of a company require "paid up capital" of a substantial amount?

Doesn't the management have to consist of Malaysians, at least in part. Is your wife Malaysian? Thus you'd have two Malaysian partners (your wife and the accountant)? Don't they own a certain amount of the company?
In our case we didn't have the high paid up capital requirement because we don't need to apply for any Employment Passes (EP). Working under LTSVP is different (and cheaper) than doing so under an EP.

My wife is Malaysian (otherwise I wouldn't be able to get the LTSVP at least not in the "Married to Malaysian" category).

So we only needed 2 shares of 1rm each to give us 50% ownership of the company each. The accountant doesn't own a share.

If we did need to apply for an EP (e.g. if we had to employ another foreigner who is not on LTSVP) then we would need paid-up capital of 350K MYR.

If company is completely foreign owned that goes up to 500K.

Full details below:

https://www.3ecpa.com.my/services/im...s-application/
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Old Yesterday, 1:39 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Thanks clarifies things. Sounds like this would be useful for contract work for foreign-based company. Or simply for creating a company/business.

Are there any restrictions as to the type of work (sector) that you can undertake. I see a lot of expats with local wives running a Guest House, for example. Maybe this is what Andy Davison does with his business (Expat.com and MM2H)? His Malaysian wife is a partner.
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Old Today, 3:51 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Originally Posted by RedApe View Post
Thanks clarifies things. Sounds like this would be useful for contract work for foreign-based company. Or simply for creating a company/business.

Are there any restrictions as to the type of work (sector) that you can undertake. I see a lot of expats with local wives running a Guest House, for example. Maybe this is what Andy Davison does with his business (Expat.com and MM2H)? His Malaysian wife is a partner.
I don't think there is any restriction on sector - mine is in IT consulting - apparently this is eligible for SST if the annual revenue for consulting services exceeds a certain figure - but I'm not above it yet.
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Old Today, 7:27 am
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Had to look up what SST was (I initially though it was a Social Security Tax).
It's a good tax on manufactured or imported items. Not sure how they would do this for consultancy work...where's the "item"?

https://mysst.customs.gov.my/AboutBackground
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Old Today, 1:20 pm
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Default Re: Setting up a company in Malaysia in order to work under LTSVP/Spouse Visa

Originally Posted by RedApe View Post
Had to look up what SST was (I initially though it was a Social Security Tax).
It's a good tax on manufactured or imported items. Not sure how they would do this for consultancy work...where's the "item"?

https://mysst.customs.gov.my/AboutBackground
I think my consultancy falls under the (b) section on that page - services tax. They don't mention the threshold there but I think it is lower than the 500K for sales tax.
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