What is a dormant company in Malaysia and what are its obligations?
A dormant company is one that is registered but not trading. The Companies Act 2016 has no separate dormant status, so it must still lodge annual returns and financial statements, keep records and registers, and notify changes. If it will not trade again, closing it formally avoids running costs and penalties.
There is no special "dormant company" category in the Companies Act 2016. A company that has stopped trading is treated like any other company until it is wound up or struck off.
Obligations that continue
- Annual return within 30 days of the incorporation anniversary (s.68).
- Financial statements circulated within six months of year end and lodged within 30 days (ss.258-259).
- A registered office, a licensed company secretary and at least one resident director (ss.46, 196, 235).
- Registers, beneficial ownership information and record-keeping.
- Notifying SSM of changes within 14 days.
Whether a dormant company is exempt from audit is covered in the audit section; do not assume it is.
Risks of ignoring it
- Fines and daily fines for missed filings (up to RM50,000 plus daily amounts).
- SSM can strike off a company that fails to lodge annual returns for three or more years (s.68(8)) or that appears not to be carrying on business (s.549(a)). Directors' liabilities survive strike-off (s.554).
Options
- Keep it alive and file every year.
- Apply to strike off under s.550 if conditions are met.
- Wind it up voluntarily if solvent, or through a liquidator if not.
Legal basis
- Companies Act 2016, s.68
- Companies Act 2016, s.549
- Companies Act 2016, s.554
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- What does a company secretary do for a Sdn Bhd?A company secretary looks after the company's statutory compliance: keeping statutory registers, lodging forms with SSM on time, preparing notices and minutes of meetings, and advising directors on their Companies Act duties. They do not replace the directors, who remain responsible for the company.
- What is beneficial ownership reporting for Malaysian companies?Since the Companies (Amendment) Act 2024 (in force 1 April 2024), every Malaysian company must identify the natural persons who ultimately own or control it, keep a beneficial owner register and notify SSM of the information and later changes. A beneficial owner can be someone with ultimate effective control, not only a shareholder.
- What is the deadline to lodge beneficial ownership information with SSM?Changes to the beneficial owner register must be lodged with SSM through e-BOS within 14 days of being recorded (s.60B(3) and (4)). SSM gave companies until 30 September 2024 to lodge their first information without the 14-day limit or late charges. That window has closed, and lodging carries no SSM fee.
- What are the penalties for not complying with beneficial ownership rules in Malaysia?Breaching the beneficial owner register rules is an offence for the company and every officer under s.60B(6): a fine of up to RM20,000, plus up to RM500 for each further day the offence continues after conviction. Breaches of the disclosure duties in ss.60C and 60D fall under the Act's general penalty: a fine of up to RM50,000, and for individuals up to three years in prison.
- When is the annual return due for a Sdn Bhd in Malaysia?A company must lodge its annual return with SSM within 30 days from the anniversary of its incorporation date, every calendar year. It does not apply in the calendar year the company is incorporated. The return is signed by a director or secretary.