Over the last decade, Malaysia has developed into a thriving, lively hub of retail and commerce. It is now considered to be one of the top four cities in Asia for entrepreneurs and investors. There are all kinds of reasons for this, not least the warmth and welcome provided by the locals.
The people here are very hard working and gracious, but they are also excited about the development of new technologies. With steadily increasing incomes, they are eager consumers and make a great target market for tech start-ups. Plus, the government just removed restrictions on the number of foreigners permitted in a company.
There are some significant tax incentives for SMEs in Malaysia, so if your enterprise is looking for a new home, it could be time to try Southeast Asia. Keep reading to find out more.
Reduced Corporate Income Tax
If a company presents a chargeable income that is under the limit of RM 500,000, the rate of tax is a rather small 20%, instead of the usual 25%. In even better news, the government has just made another change to the law (in the last twelve months), which means that the rate is down to 19% for some businesses.
If there was ever a good time to consider setting up a venture in Malaysia, it is right now. With flexible office solutions, you can keep a tight hold over your early expenses. To find out more about the best serviced and Virtual offices, visit – www.servcorp.com.my/en/virtual-offices/. There are some superb providers in the capital city of Kuala Lumpur.
Tax Breaks for Tech Ventures
The Malaysian government has made a great effort, in recent years, to support tech companies. It provides a range of different benefits and exemptions for IT businesses and enterprises in certain service sectors. For instance, IT and communications companies are given financial support when setting up e-commerce platforms.
Funding lasts for five years and usually amounts to around 20% of the expenses incurred. Some businesses (dependent on certain criteria) also benefit from cuts on stamp duty. Generally, tech entrepreneurs do very well in the South-east Asian markets, because there is a real appetite for innovation and new products.
In Malaysia, some expenses are eligible to be registered as double deductions. They include things like the costs incurred when acquiring certain certifications and proof of standards. In some cases, the cost of training employees is supported, and most companies receive childcare allowance for their workers.
The funding even stretches to participation in employment fairs and important networking events outside of the country, though it is important to check whether an event is covered first. The full list of double deductions is quite lengthy, but it is worth taking the time to get familiar with it. For businesses planning to expand into Malaysia, it represents some major cost cutting opportunities.
Considering Virtual Office Solutions
If you want to launch your company with caution and protect your investment, you have to make the right decisions when it comes to logistics. Rather than opting for a full time, lock in lease, a better option is to work from a flexible corporate suite. They come with very low rates and minimal waste, but you do not have to compromise on the quality of resources.
Instead of committing to a 2-7 year lease, which you are not sure will be suitable for that long, keep your options open and go virtual. The main providers in Kuala Lumpur are located in some very prestigious locations. Tenants are invited to use the corporate addresses for their mail and other communications, whether or not they have a second physical office.