Tags :
Share This :
How to Strike Off a Dormant Company in Malaysia: 7 Key Points to Consider
Posted by
on
Many business owners in Malaysia establish a company with the best intentions, but not all entities become active. Some never commence operations, while others cease trading and are left inactive. Under the Companies Act 2016, these entities are considered dormant companies.
Maintaining a dormant company still involves compliance costs and obligations, such as annual filings with the Companies Commission of Malaysia (SSM). Many directors choose a company strike-off to avoid unnecessary expenses and penalties.
This is a common and practical approach to formally closing a business that is no longer operational. Learning how to strike off a dormant company in Malaysia is essential for ensuring a smooth and compliant closure.
If you are considering this route, here are eight key points every director and shareholder should understand before proceeding with a company closure in Malaysia.
1. Strike Off a Dormant Company in Malaysia: Confirm Dormant Status
Before applying for a dormant company strike off, you must ensure your company qualifies under SSM’s definition. According to the official SSM guidelines, a dormant company is one that:
- Has had no business activity or income since incorporation, or
- Has ceased all business operations and remains inactive.
It is important to note that a company holding assets, liabilities, or operating licences may not meet the strict criteria for a strike off in Malaysia. The entity must be completely inactive to qualify.
2. Settle All Outstanding Liabilities
A company with unpaid debts cannot be struck off. This is a non-negotiable prerequisite for a successful application. Before applying for an SSM strike off, directors must:
- Clear all outstanding taxes with the Inland Revenue Board (LHDN).
- Ensure no obligations remain with EPF, SOCSO, or EIS.
- Settle any creditor claims, supplier payments, or employee dues.
Only companies that are completely debt-free are eligible. Any pending financial obligations will lead to the rejection of your application.
3. Close Bank Accounts and Cancel Licences
A commonly overlooked step when learning how to strike off a dormant company in Malaysia is the formal closure of all corporate bank accounts and the cancellation of business licences, permits, and registrations.
If a bank account remains active or licences are still registered under the company’s name, SSM is likely to reject the strike-off application. This makes it essential to ensure the company has been fully de-registered from all relevant authorities before you begin the process.
4. Pass a Board Resolution
The decision to strike off a company in Malaysia requires the formal approval of its board of directors and shareholders. This is documented in a board resolution, which serves as official proof of the collective decision.
The resolution confirms that the company intends to apply for strike off and protects directors from potential future disputes. Without this formal step, the strike off application cannot move forward.
5. File Form 68 with SSM (via MyCoID)
The official application for a strike off a dormant company in Malaysia is made using Form 68 – Application by Company to Strike Off. This form contains several key declarations, including:
- A declaration of dormancy signed by the directors.
- Confirmation that the company has no outstanding liabilities.
- Company and shareholder particulars.
Form 68 is submitted through the SSM MyCoID portal. Once submitted, the regulator begins its assessment of the application. This is often referred to as the SSM Form 68 strike off process.
6. Gazette Notice and Objection Period
Once the application is reviewed and accepted, SSM will publish a notice of the intended strike off in the Government Gazette.
This publication marks the beginning of a 30-day objection period. During this time, creditors, shareholders, employees, or tax authorities may raise an objection to the strike off. If no valid objections are received within this window, the process moves forward toward final dissolution.
7. Timeline and Costs
The entire timeline for company strike off in Malaysia typically takes between 6 to 12 months. This duration depends on the completeness of your application and whether any objections are filed.
While the direct fee for the application with SSM is minimal, other costs may arise. Many business owners seek to understand the cost to strike off a dormant company in Malaysia, but the greater financial risk comes from delays or rejection due to an improperly managed process. Professional assistance may be required to prepare documents, close bank accounts, or resolve outstanding compliance matters, which can add to the overall expense.
Successfully navigating the process of how to strike off a dormant company in Malaysia requires careful attention to detail and strict adherence to regulatory requirements. Mishandling any of the eight points discussed can lead to delays, rejection, and unnecessary costs.
Thinking of striking off your dormant company? Contact WAMINDA SDN BHD’s corporate secretarial experts for a smooth and compliant closure.
Have Any Question?
We value your interest and are here to assist you. Please don’t hesitate to contact us.
- info@wamindasdnbhd.my