Why choose Sole Proprietorship amongst others?
A sole proprietorship is a structure most local businessmen tend to venture into. The reasons for this are:
1. Easy formation
The structure itself is simple to form. There are four steps to form the sole proprietorship in Malaysia:
Visit any Companies Commission of Malaysia (SSM) branch to complete the registration form
The SSM officer will assist to check the availability of the proposed name
If the name is available, the form is completely filled, then the officer will assist to register the sole proprietorship with a fee of MYR 60 per annum for using a trade name or MYR 30 per annum for using personal name. If you’re opening another branch, the fee is only MYR 5 per annum
The business registration certificate will be available at SSM counter within 1 hour after the payment is made
2. Becoming your own boss
A sole proprietor business owners have the power to make their own decision without wasting their time involving other parties. Hence, if the decision made lead to a profitable path, the owner would greatly gain the income without the need to share with others.
Since the profit and losses generated by the business will directly go into the owner’s pocket, hence they are only required to file them as business income as part of their personal tax computation. No separate corporate tax filing is required. The tax rate is between 0% to 30%.
4. Lowest annual cost
Another benefit of venturing into sole proprietorship is because they have the lowest annual maintenance cost. Business owners are only required to pay their annual registration fee which cost between MYR 5 to MYR 60 per annum. They can do so by visiting any SSM branch available
5. Winding up easily
The process to close down a sole proprietorship is also the easiest and fastest. The business owners may visit any SSM branch available to immediately close their business. Another option is to stop paying the annual registration fee altogether.