TaxSavvyMY

LLP or Sdn Bhd for a consultancy

Better to set up my consultancy as an LLP or a Sdn Bhd?

The situation

Both give limited liability. A Sdn Bhd suits outside investors and share-based ownership; an LLP suits partners sharing profits.

The law

  • Limited Liability Partnerships Act 2012: Registration of LLPs and annual declaration of solvency within 90 days after financial year end
  • Sec 14, Companies Act 2016: Application to incorporate a company is lodged with the Registrar (SSM)

What it means for you

An LLP has lighter governance and usually no audit. A Sdn Bhd has a secretary, annual return and audit or exemption. Investors and banks often prefer companies. Tax rates are similar if both meet SME conditions; check them for your case.

What to do

  1. List your funding and ownership plans.
  2. Compare yearly compliance costs.
  3. Check tax conditions for both.
  4. Register the chosen vehicle.

We can do this for youRegister an LLP and file the annual declaration: MYR 900

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