Last year, the Covid-19 pandemic triggered a 5.6 percent drop in economic growth. But to our surprise, more enterprises and companies actually began operations in the second half of 2020 as compared to previous years. Many have overcome adversity to begin their entrepreneurial journey. With the Malaysian economy picking up steadily, here are 4 reasons why entrepreneurs prefer to set up a company in Malaysia as Sdn Bhd in 2021.
Related Read: What is a Sdn Bhd Company in Malaysia »
Table of Contents
1. Malaysia’s economy is rebounding in 2021
As the vaccination programme has started to roll out in Malaysia since late February 2021, signs of improved economic activities are seen where eateries are full, shopping malls are crowded, and the roads are full with traffic again. The Central Bank of Malaysia (Bank Negara) has recently projected a GDP growth between 6% and 7.5% in 2021, having one of the strongest growth potentials in Southeast Asia.
In a nutshell, Malaysians can no longer wait to get out and re-start the pre-MCO lifestyle and these are the signs that the economy is recovering and what better time it is to set up a company in Malaysia to leverage on the recovery.
2. Malaysia tax rebates for newly incorporated Sdn Bhd
As part of the economic recovery plan, the Government has announced an additional RM20,000 tax rebate for companies registered between 1 July 2020 to 31 December 2021. In essence, based on the general tax rate, approx. the first RM117,000 profit that the company makes is tax-free! (note that this figure is for illustration purposes only as actual tax deduction may vary on a case-by-case basis).
3. Malaysia tax deductions on renovation and refurbishment
In addition to the RM20,000 tax rebate, the Malaysian Government has also announced that renovation and refurbishment expenses totaling up to RM300,000 and spent in 2021 can enjoy a special tax deduction, which translates to approx. RM50,000 to RM70,000 in tax savings (depending on the tax bracket of company corporate taxes). In the past, LHDN generally allowed these expenses to be claimed only via capital allowance if these expenses met the conditions.
4. Availability of various grants and loans
Many grants and loans are also given out to Small-Medium-sized Enterprises (SMEs) as part of the efforts to rejuvenate the economy and many of the grant or loan qualifying terms would require the entity to be anf Sdn Bhd in order to be eligible to apply for these grants and loans.
Related Read: Malaysia RM35 billion Short-Term Economic Recovery Plan
In conclusion, for all the aspiring entrepreneurs looking to achieve your next milestone, you can benefit from the perks mentioned when you set up a company in Malaysia online. All it takes is 10 minutes of your time and we will help to take your business to the next level!
- The Malaysian business landscape offers entrepreneurs numerous opportunities to set up a company in Malaysia as a Sdn Bhd due to the following:
- Malaysia economy rebound in 2021
- RM 20,000 tax rebate for newly incorporated Sdn Bhd
- RM 30,000 tax deduction on renovation and refurbishment
- Availability of various grants and loans
- The RM 20,000 tax rebate is for those who have newly set up a company in Malaysia between 1 July 2020 to 31 December 2021.
- The special tax deduction on renovation and refurbishment allows Malaysian companies to enjoy tax savings of about RM 50,000 to RM 70,000. However, this is dependent on the tax bracket of your company’s corporate taxes.
- Most of the grants and loans have qualifying terms that require the company to be a Sdn Bhd to be eligible for the benefits.
WeCorporate content team comprises experienced in-house and freelance writers who share trending and insightful content to empower and aspire entrepreneurs to change their gameplay in their business in Asia.
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