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Registered capital requirements in Malaysia.

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Registered capital requirements in Malaysia

This ultimate guide will explain what paid-up capital for a Malaysian company is, how much is needed and how to increase or reduce shares.

Paid-up capital is a requirement when setting up a company in Malaysia. It is vitally important that you comply with the regulations concerning paid-up capital to avoid serious legal issues.

What is paid-up capital?

Paid-up capital is the amount of money that has been received from shareholders for the issue of shares.

How much is needed?

Companies in Malaysia can register their company with a minimum paid-up capital of RM 1.00. However, if you are applying for an Employment Pass, you would have to increase your paid-up capital to RM 500,000.

Additionally, there are specific requirements for paid-up capital for the following types of companies:

  • For a company that is 100% foreign-owned, the minimum paid-up capital of RM 500,000 would apply to advisory and consultancy businesses, while import, export, restaurant and trading businesses require a minimum paid-up capital of RM 1 million.
  • Joint ventures with a Malaysian partner (minimum 50% control) require a minimum paid-up capital of RM 350,000.

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Reasons for increasing your paid-up capital

  1. Requested by the bank – the company may be required to increase the paid-up capital, which is a part of the terms and conditions in the Letter of Offer from the bank for business loan applications.
  2. Project tender requirement – the company is required to have a minimum of a certain paid-up capital in order to be qualified for a project tender.
  3. License requirement – a company is required to have certain business licenses before it can operate or would need to have at least a certain amount of paid-up capital before they can apply for a working visa for the foreign staff.
  4. Credibility – having a high paid-up capital creates an impression of establishment and security to customers and suppliers, and increases the company’s credibility.

How to increase paid-up capital

  1. Deposit the amount of money into the company’s bank account and generate a bank-in slip for the company secretary.
  2. The company secretary will prepare the board’s and member’s resolutions and necessary documents.
  3. All directors and shareholders must sign the resolution and documents.
  4. The company secretary will file return on allotment of shares to the SSM for the registration of increasing the paid-up capital.

When to make calls on shares

According to section 82 of the Companies Act 2016, directors of the company may make calls upon the shareholders regarding any money that is unpaid on the shares and not by the conditions of allotment of shares made payable at a fixed date.

The call should not exceed one-fourth of the issued price of the share or paid less than 30 days from the fixed date of the last preceding call. Each member must pay the amount called on the shares at least 14 days since the specified date, time and place of payment.

If a shareholder does not pay the call or instalment of the call within the specified time, the directors may issue a notice to the shareholder requiring payment of the unpaid amount along with interest or compensation that may have increased.

The notice shall specify the date the payment must be paid and state that if payment is not made within the specified date, the shares which the call was made subjected to be forfeited.

Share capital reduction

A company can reduce the share capital by a special resolution and confirmation by the court or a special resolution supported by a solvency statement.

Share reduction by a special resolution and confirmation by the court

When reducing the share capital by a special resolution and confirmation by the court according to section 116, the capital can be decreased by reducing the liability of the shares in respect of the unpaid share capital, by cancelling paid-up share capital unrepresented by available assets or by returning any paid-up share capital to the shareholder which exceeds the needs of the company.

Share reduction by a special resolution supported by a solvency statement

In accordance with section 117, a company can reduce the share capital by a special resolution if the company sends a notice to the Inland Revenue Board and Registrar within seven days of the issuance of the resolution and meets the solvency requirements.

A company meets the requirements of solvency if all the company directors make a solvency statement with regard to the reduction of the share capital. The statement should be made within 14 days for a private company and within 21 days or a public company.

If the resolution for reducing share capital for a private company is to be passed by a written resolution, make sure that every copy of the resolution is accompanied with a solvency statement, or if the resolution is passed in a general meeting, ensure that the copy is available to be inspected by the members and the copy of the solvency statement should be available at the company’s registered office.

The solvency statement for public companies must be available for inspection by members at the general meeting and should be accessible at the registered office.


There are certain requirements and regulations you must meet to be able to register, increase or reduce your paid-up capital in Malaysia. This process can sometimes be technical and complicating for individuals who are unfamiliar with the process.

It is advisable to engage with Acclime’s services to ensure that you correctly comply with the Malaysian Companies Act.