SDN BHD
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SDN BHD, which stands for private limited company, requires at least one shareholder and one director. It is mandatory to appoint a company secretary.
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However, it is not necessary to engage an accounting firm for bookkeeping; you can hire internal staff to handle the accounts.
- The company's financial records, whether it's income or expenses, must be clearly and explicitly detailed. Additionally, they must undergo an audit, and a Tax Agent must be appointed for tax filing.
Enterprise
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Trading or Enterprise is just different names.
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Trading usually means doing business in the trading industry, but not always. Enterprise means a business, so it includes various types of businesses. Other names like Syarikat can also be used.
- Whether it's Trading, Enterprise, or Syarikat, they can be either Sole Proprietorship or Partnership, different from Sdn Bhd. If it's a one-person company, it's Sole Proprietorship; if there are two or more partners, it's Partnership.
What are the differences between Enterprise and SDN BHD ?
Legal Status
- Enterprise: The owner and the business are considered together, with no special legal status. It's like a person's own business.
- SDN BHD: It's like a separate person with legal standing. Investors (shareholders) put in money, and a smart person manages the company.
Number of Owners/Shareholders
- Enterprise: If it's just one person, it's called a Sole Proprietorship. If there are 2 to 20 people, it's called a Partnership.
- SDN BHD: If there are 1 to 50 people involved.
Debt Responsibility
- Enterprise: If you have your own business, you're fully responsible for any money problems.
- SDN BHD: It's more like the money problems are limited to the shareholders.
Duration of Operation
- Enterprise: If something big happens to the owner, like bankruptcy or passing away, the business might stop.
- SDN BHD: The business can keep going forever, even if the owners change, as long as they transfer their shares.
Ownership of Stuff and Places
- Enterprise: Everything in the business belongs to the owner or owners, and they share it together.
- SDN BHD: The business itself owns everything, not the people who put money in.
Tax Rates
- Enterprise: Whatever money the business makes gets added to the owner's own money, and they pay tax together.
- SDN BHD: If the business didn’t get more than RM2.5 million, the first RM500k gets taxed at 20%, and anything more gets taxed at 25%.
The difference between Enterprise and SDN BHD