Incorporating a Sdn Bhd is just the beginning. Once your company is up and running, it becomes subject to a range of ongoing statutory obligations — annual filings, tax submissions, financial statements, and more. Missing these deadlines can result in significant penalties for both the company and its directors personally.
This guide provides a comprehensive overview of everything a Sdn Bhd director needs to know about keeping the company compliant after incorporation.
Part 1
Why Compliance Matters for Directors Personally
Many business owners assume that compliance penalties fall on the company. In reality, under the Companies Act 2016, directors are personally responsible for ensuring the company meets its statutory obligations. This means:
Directors can be personally fined for non-compliance — even if the company itself is the named entity in breach
Maximum penalties range from RM20,000 to RM500,000 per offence
SSM and LHDN can pursue enforcement action against both the company and its officers
A poor compliance record can affect the company's credibility with banks, investors, and government bodies
The good news: compliance is manageable when you understand what is required and when. A good company secretary will keep you informed of upcoming deadlines and make sure nothing slips through the cracks.
Part 2
Understanding Your Financial Year End (FYE)
Your Financial Year End (FYE) is the date on which your company's 12-month accounting period closes each year. Almost all of your annual compliance deadlines are calculated from this date, so understanding it is essential.
Can I choose my own FYE?
Yes. When you incorporate your Sdn Bhd, you can choose your preferred FYE. Common choices are 31 December, 31 March, 30 June, or 31 August — but any month-end date is permitted. Once set, it can be changed by resolution and notification to SSM, though this affects your compliance calendar.
Why does FYE matter?
Your FYE determines the deadline for your audited financial statements, tax filings, and AGM. For example, if your FYE is 31 December 2025, your audited financial statements must be completed and circulated within 6 months — by 30 June 2026 — and submitted to SSM within 30 days of circulation, by 30 July 2026.
Important distinction: The Annual Return deadline is not linked to your FYE. It is calculated from your company's incorporation anniversary date — specifically, it must be submitted to SSM within 30 days of that anniversary each year, regardless of when your financial year ends.
First-year note: For newly incorporated companies, the first Audited Financial Statements must be completed within 18 months from the date of incorporation. Subsequent years follow the standard 6-month rule from FYE.
Part 3
Annual Compliance Milestones
The following table summarises the key compliance obligations every Sdn Bhd must fulfil each year, who is responsible, and the relevant deadlines:
Compliance
Deadline
Required by
Handled by
Preparation of Management Accounts
Within 6 months from FYE
LHDN & SSM
Bookkeeper / Accountant
Preparation of Audited Financial Statements (AFS)
Within 6 months from FYE (18 months for first AFS)
LHDN & SSM
Auditors
Circulation of Audited Financial Statements (AFS)
Within 6 months from FYE
SSM
Company Secretary
Submission of Audited Financial Statements to SSM
Within 30 days from the date of circulation
SSM
Company Secretary
Submission of Annual Return (Section 68)
Within 30 days from the company's anniversary of incorporation — this is independent of your FYE
SSM
Company Secretary
Submission of Tax Estimation (CP204)
Within 3 months from commencement of business; revised in the 6th and 9th month
LHDN
Tax Agent
Submission of Corporate Tax Return (Form C)
8th month after FYE
LHDN
Tax Agent
Annual General Meeting (AGM)
First AGM: within 18 months of incorporation. Subsequent AGMs: within 6 months of FYE and not more than 15 months from the previous AGM
Companies Act 2016
Company Secretary
Who arranges what? Your company secretary handles SSM filings and corporate governance — including the Annual Return (due 30 days from incorporation anniversary) and financial statement submissions. Your auditors prepare the financial statements. Your tax agent handles LHDN submissions. These three parties need to work in coordination — make sure all three are appointed early.
Part 4
What to Prepare Throughout the Year
Annual compliance doesn't start a month before the deadline — it requires ongoing record-keeping throughout the year. Here is what every Sdn Bhd director should ensure is in place:
Bookkeeping and accounting records
Maintain proper records of all income, expenses, and bank transactions — updated regularly, not just at year-end
Keep all invoices, receipts, bank statements, and supplier agreements organised and accessible
Reconcile bank accounts monthly to catch discrepancies early
Use accounting software where possible — it speeds up the audit process significantly
Corporate statutory records
Your company secretary maintains your statutory registers (register of members, directors, charges, etc.) — keep them informed of any changes promptly
Board resolutions must be prepared and signed for all major company decisions (opening bank accounts, accepting loans, director changes, dividend declarations, etc.)
Minutes of meetings (board and AGM) must be properly recorded and filed
Payroll records (if you have employees)
Maintain monthly payroll summaries and EPF, SOCSO, EIS, and PCB contribution records
Issue EA forms to all employees by 28/29 February each year
Submit Form E (employer's tax return) to LHDN by 31 March each year
Tax-related preparation
Submit CP204 (tax estimation) within 3 months from the date your business commences — and revise in the 6th and 9th month of the financial year
Pay monthly tax instalments (CP204 instalments) to LHDN as per the approved estimate
Monitor your revenue — if annual taxable turnover exceeds RM500,000, SST registration becomes mandatory
Tip: The quality of your year-end accounting records directly determines how quickly your auditors can complete the financial statements. Disorganised records lead to delays, additional audit fees, and missed SSM deadlines. Good bookkeeping throughout the year saves time and money at year-end.
Part 5
Non-Compliance Penalties
The penalties for non-compliance under the Companies Act 2016 are significant. Directors should be aware that these can apply to them personally, not just to the company.
Compliance Matter
Section
Explanation
Maximum Penalty
Submission of Annual Return
68(1)
Must be submitted within 30 days from the company's anniversary of incorporation
RM50,000
Preparation of Audited Financial Statements
248(1)
First AFS: within 18 months of incorporation. Subsequent AFS: within 6 months from FYE
RM500,000
Circulation of Audited Financial Statements
258
Must be distributed to members within 6 months from the end of the financial year
RM50,000
Submission of Audited Financial Statements to SSM
259(1)
Must be submitted within 30 days from the date of circulation to members
RM50,000
Annual General Meeting (AGM)
340(2)
First AGM: within 18 months of incorporation. Subsequent AGMs: within 6 months of FYE and not more than 15 months from the previous AGM
RM20,000
Important: The penalty for failure to prepare Audited Financial Statements is up to RM500,000 — the highest single penalty under this compliance framework. This applies to directors personally. Do not treat the audit as an optional exercise.
Part 6
When to Notify Your Company Secretary
Your company secretary is responsible for keeping your company's statutory records up to date with SSM. Many changes to your company — even routine ones — require formal documentation and SSM filings. You must inform your company secretary promptly whenever any of the following occur:
1Appointment and/or resignation of directors
2Change of director's details (passport no., residential address, nationality, etc.)
3Appointment or change of auditors and/or tax agent
4Transfer of shares
5Change of business address or business nature
6Allotment of shares or increase of share capital
7Declaration of dividend
8Directors' fees and/or remuneration
9Change of company name
10Change of Financial Year End
11Opening of bank account
12Acceptance of banking facility
13Entering into a significant agreement (SPA, tenancy, etc.)
14Any other changes — when in doubt, check with us
Do not delay: Failure to update statutory records promptly can result in inaccurate SSM filings, which may carry penalties and create complications for future banking, licensing, or legal matters. When in doubt, contact your company secretary first.
Under the Companies Act 2016 (as amended), every Sdn Bhd is required to identify, verify, and maintain a register of its Beneficial Owners — the individuals who ultimately own or control the company, even if shares are held through nominees or holding structures.
Directors must lodge Beneficial Ownership information with SSM and keep it updated
Any change in beneficial ownership must be reported within 14 days
This requirement applies to all companies, regardless of size or turnover
Non-compliance can result in penalties for both the company and its directors
What is a beneficial owner? A beneficial owner is any individual who holds (directly or indirectly) more than 20% of the company's shares or voting rights, or who exercises effective control over the company — even if their name does not appear on the share register.
E-Invoicing
LHDN has introduced a mandatory e-invoicing requirement for businesses in Malaysia on a phased rollout basis, based on annual turnover:
Annual Turnover
E-Invoicing Mandatory From
Above RM100 million
1 August 2024
Above RM25 million
1 January 2025
All other businesses
1 July 2025
E-invoices must be submitted to LHDN's MyInvois portal for validation before being issued to buyers
Once validated, an e-invoice cannot be cancelled — a credit note or debit note must be issued instead
Most accounting software now supports e-invoicing integration — check with your bookkeeper or accountant
Newly incorporated companies should set up e-invoicing from the start, as the threshold can be reached quickly in a growing business
Not sure if e-invoicing applies to you yet? If your company is newly incorporated and has not yet reached RM25 million in annual turnover, e-invoicing became mandatory from 1 July 2025. Contact your accountant to ensure your invoicing system is compliant.
Summary
Annual Compliance at a Glance
When
What
Who
Within 3 months of commencing business
Submit CP204 (tax estimation) to LHDN
Tax agent
Monthly
Pay CP204 monthly tax instalments to LHDN
Tax agent / director
Within 6 months from FYE
Complete management accounts, prepare and circulate audited financial statements
Accountant, auditors, company secretary
Within 30 days of AFS circulation
Submit AFS to SSM
Company secretary
Within 30 days of incorporation anniversary
Submit Annual Return to SSM
Company secretary
8th month after FYE
Submit Form C (corporate tax return) to LHDN
Tax agent
28/29 February
Issue EA forms to all employees
Employer / payroll
31 March
Submit Form E (employer tax return) to LHDN
Tax agent / employer
Within 18 months of incorporation (first year only)
Hold first AGM; complete first AFS
Company secretary, auditors
Within 14 days of any change
Update Beneficial Ownership register
Company secretary
Need help staying on top of your compliance?
At C&G Corporate Services, we work with Sdn Bhd companies of all sizes to ensure their annual compliance obligations are met accurately and on time — from company secretarial services and annual returns to coordination with auditors and tax agents.
Contact us today to find out how we can help keep your company compliant.
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