Often many did not consider the eventual closure of the business, but it is an important area being overlooked as closing or exiting a business in Malaysia requires to follow proper legal procedures to ensure compliance with the Companies Act 2016, tax regulations, and relevant licensing authorities. Whether you are shutting down a Private Limited Company (Sdn Bhd), Sole Proprietorship, Partnership, or Limited Liability Partnership (LLP), following the correct process is essential to avoid penalties and legal complications.
At Amaze Advisory, we specialize in business closure, liquidation, and compliance services to help businesses exit smoothly and legally.
Why Proper Business Closure is Important?
- Avoid Legal & Financial Liabilities:
Failure to close a business properly can result in penalties, legal actions, or outstanding debts. - Protect Directors & Shareholders:
Proper deregistration ensures directors are no longer liable for company obligations. - Comply with Tax & Regulatory Authorities:
Closing a company requires clearance from LHDN (Inland Revenue Board), SSM, EPF, Perkeso and other agencies. - Prevent Unnecessary Future Costs:
Keeping an inactive company may lead to annual fees, compliance costs, and penalties.
Step-by-Step Guide to Closing a Business in Malaysia
1. Choose the Right Business Closure Method
The method of closing a business depends on its legal structure and financial status. Common options include:
| Business Closure Method | Suitable For | Key Features |
|---|---|---|
| Voluntary Strike-Off | Sdn Bhd with no assets/liabilities | Quick process; No liquidation needed; Lower cost |
| Members’ Voluntary Liquidation (MVL) | Solvent companies (assets > liabilities) | Longer process (between 6 months to 12 months); Requires liquidator & tax clearance |
| Creditors’ Voluntary Liquidation (CVL) | Insolvent companies (liabilities > assets) | Liquidator appointed to pay creditors |
| Compulsory Winding Up | Court-ordered closure | Legal action due to unpaid debts |
| Deregistration of Sole Proprietorship | Small businesses & partnerships | Submit deregistration to SSM |
| Closure of Limited Liability Partnership (LLP) | LLP with no assets/liabilities | Quick process; No liquidation needed; Lower cost |
Unsure which option suits your business? Amaze Advisory can assess your business and recommend the best exit strategy.
2. Settle All Outstanding Debts & Liabilities
Before closing your business, ensure all outstanding debts, taxes, and employee obligations are cleared, including:
- Tax Clearance form LDHN and RMCD – Settle corporate tax, SST, and other tax liabilities.
- EPF, SOCSO & HRDF Payments – Pay all outstanding employee contributions.
- Supplier & Creditor Settlements – Clear unpaid invoices and contractual obligations.
Amaze Advisory ensures a smooth debt settlement and tax clearance process for businesses exiting Malaysia.
3. Apply for Company Strike-Off or Liquidation
Strike-Off (for Sdn Bhd with No Liabilities)
- Submit an application to SSM (Suruhanjaya Syarikat Malaysia) under Section 550 of the Companies Act 2016.
- Requires company to be inactive, debt-free, and with no pending legal cases.
- Approval takes 3-6 months.
Liquidation (for Companies with Assets or Liabilities)
- Appoint a licensed liquidator to manage the winding-up process.
- Sell company assets to settle debts and employer’s obligations.
- Distribute remaining assets to shareholders.
- Obtain final tax clearance before official dissolution.
Amaze Advisory assists with company strike-off, voluntary liquidation, and winding-up procedures for smooth business closure.
4. Notify Relevant Authorities & Stakeholders
Closing a business requires notifying relevant regulatory bodies, including:
- SSM (Companies Commission of Malaysia) – Submit the business closure application.
- LHDN (Inland Revenue Board) – Obtain tax clearance and de-register tax files.
- EPF, SOCSO & HRDF – Terminate employee contributions and benefits.
- Royal Malaysian Customs Department – Obtain clearance and de-register company files.
- Business Licenses & Permits Authorities – Cancel or transfer necessary licenses.
- Bank & Financial Institutions – Close corporate bank accounts and settle outstanding loans.
Amaze Advisory handles all deregistration and legal formalities to ensure a seamless exit.
5. Close Business Bank Accounts & Finalize Tax Matters
- Close all corporate bank accounts once financial obligations are cleared.
- Submit final tax returns and obtain tax clearance from LHDN.
- Retain business records for at least 7 years, as required by law.
Need help managing your final tax filings? Amaze Advisory’s tax consultants will ensure everything is handled properly.
6. Finalize Business Closure & Receive Official Confirmation
Once all procedures are complete, you will receive:
- SSM Strike-Off Approval or Winding-Up Certificate
- Tax Clearance Confirmation from LHDN
- Bank Account Closure Confirmation
Amaze Advisory ensures you receive official confirmation of your business closure, so you can move forward with confidence.
Common Challenges & How Amaze Advisory Can Help
| Challenge | Solution by Amaze Advisory |
|---|---|
| Complex legal procedures | We handle all documentation & filings |
| Unsettled tax or financial obligations | We assist in tax clearance & debt settlements |
| License and business deregistration | We manage SSM, LHDN, RMCD and permit cancellations |
| Employee terminations & settlements | We ensure compliance with labour laws & EPF/SOCSO |
Conclusion
Closing or exiting a business in Malaysia involves legal compliance, tax clearance, and proper documentation to avoid future liabilities. Whether you need strike-off, liquidation, or winding-up services, following the correct process ensures a smooth and hassle-free exit.
At Amaze Advisory, we provide expert business closure services,, including:
- Company Strike-Off & Deregistration
- Voluntary Liquidation & Winding-Up Services
- Tax Clearance & Financial Compliance
- Legal Documentation & Regulatory Filings
Get Started with Amaze Advisory Today!
Phone: +6013-284 7678 / +6013-323 7678
Website: www.amazeadvisory.com
