Get a free* Business Account when you incorporate your company

or transfer to Sleek.

Starting a business: Singapore versus Malaysia

5 minute read

Singapore is often touted as the best place in Asia to set up your business, but what gives it the edge over Malaysia? Both countries share similar history, culture and are neighbours geographically. This guide will discuss the comparison between Singapore and Malaysia when it comes to setting up a business.

Global rankings

Based on World Bank’s Ease of Doing Business Report 2018, Singapore is ranked #2 in the world whereas Malaysia is ranked #15. This is how Singapore fares compared to Malaysia:

Singapore Malaysia
Starting a business #3 #122
Trading across borders #45 #48
Enforcing contracts #1 #33

Incorporation and foreign ownership

For Pte Ltd entities Singapore only requires 1 resident director and 1 shareholder. For Sendirian Berhad (Sdn Bhd) entities Malaysia requires at least 2 resident directors and 2 shareholders.

Directors and shareholders

Singapore only requires 1 resident director and 1 shareholder. Malaysia requires Sendirian Berhad (Sdn Bhd)  to have at least 2 resident directors and 2 shareholders.

Ownership & Shares

In Singapore, a Pte Ltd company can be 100% foreign-owned. In Malaysia, 100% foreign ownership is generally allowed at the moment. However, certain industries such as telecommunications, financial services, and transportation require at least 30% local ownership.


Singapore has been known to have one of the lowest corporate taxes in the world, ranging between 0 to 17%. This is further equipped with extensive tax treaties with more than 50 countries which provide companies greater advantage over other countries.

Malaysia’s corporate tax is higher – from 18% through to 24%.

Tax exemptions

The Singaporean government also has several policies to help new businesses and startups in order to promote them by reducing the overheads in their early stage.

These exemptions are in flux over the next coming years – see the IRAS website for more details on the tax exemption schemes.

Similarly, Malaysia’s corporate tax rate starts at 18% for the first MYR 500,000 moves to 24% for companies with a paid-up capital of MYR 2.5 Million or less.

Tax benefits for startups in Malaysia? There is a Multimedia Super Corridor (MSC) status given to qualifying tech companies to enjoy a 5+5 years of tax breaks. However at this moment, the governing agency MDEC is  reviewing the eligibility and criteria of MSC.


The Singaporean government has also provided various grants and schemes to support innovative companies. If you are interested in pursuing these, we encourage you to take a look at this (non-exhaustive) list of grants with bodies such as Enterprise Development Grant (EDG) and IDA.
For more information refer to our resources:

External investment

Looking to get VC money? Many VC firms these days are based in Singapore or will only invest in companies with a Singapore entity. The relative stability of Singapore as well as the government’s moves to create an ecosystem friendly to entrepreneurs is piquing the interests of VC funds. Map of the Money displays the breadth of active investors in Singapore (and can be helpful to entrepreneurs navigating the funding landscape).

In comparison, Malaysian government has just started to focus on the startup scene. The government has given support towards its venture capital arm, MAVCAP, as well as attracting some larger regional players such as Vickers Venture Partners. Although Malaysia has made great strides to improve its VC scene, it still lags behind Singapore due to size of funds available in Singapore.


Anyone intending of working in either Singapore and Malaysia must have a valid visa/pass before they can start working.

The most common visa for foreigners in Singapore and Malaysia is called the ‘Employment Pass” (EP). As it is intended for managers and skilled workers, it requires a minimum monthly salary that generally increases as the candidate becomes more experienced:

  • Monthly salary for EP in Malaysia: above RM 5,000/month
  • Monthly salary for EP in Singapore: above SG $3,600/month*

* This is the Ministry’s official guideline but in practice it is usually a lot higher $7,000/month +

Business owners from overseas can also choose to apply for an EntrePass in Singapore, or Professional Visit Pass, Short-term Social Visit Pass or Temporary Employment Pass in Malaysia.

Workforce and talent

Take a look at how the countries compare when it comes to English proficiency according to the EF English Proficiency Index:

Singapore Malaysia
English language proficiency ranking #5 #13

In addition to a higher proficiency in English, Most Singaporeans are effectively bilingual with either Chinese, Malay, or Tamil. This is very beneficial for companies with an English-speaking headquarters as it can reduce miscommunication. Furthermore, as Singapore has a very diverse population, your business may benefit from the various cultural and commercial ties with other countries such as China, Taiwan, Indonesia as well as strong economies from the West.

Business language

  • Singapore’s official languages: English, Mandarin, Malay and Tamil
  • Malaysia’s official language: Malay and English (second language)

When starting a business in another country, you may face a language barrier. Singapore and Malaysia both have a high literacy rates and are educated. Most Singaporeans generally can speak more than one language, English being the main business language. In Malaysia, the business language is technically Bahasa Malaysia – however English is widely spoken and commonly used.

Malaysia being bigger in size, may have more opportunities but business owners might find it easier to converse with Singaporeans, with English being the main spoken language.

Infrastructure and resources

Singapore is a small city-state, leading the government to focus its resources on ensuring high quality of workforce, extensive public transport for ease of accessibility and a high level of reliable internet connectivity.

Malaysia is approximately 460 times bigger than Singapore, and naturally richer in terms of its raw natural resources such as natural gas, rubber, and palm oil. This may be beneficial if your business requires these natural resources, however comes with the trade-off of poorer infrastructure.

Governance and transparency

Corruption is a major concern for many entrepreneurs and investors in Southeast Asia. The Corruption Perceptions Index by Transparency International shows that Singapore had the highest score of all Asian countries at 84/100 (on par with Sweden), with Malaysia scoring 47/100 (on par with Cuba).

Support for Malaysian Companies in Singapore

The key business organisations supporting Malaysian businesses in Singapore are:

Next steps

While both countries are similar in culture, location and language, Singapore provides several significant benefits to Malaysia when choosing a location for your regional expansion.

Interested in setting up your investment vehicle or regional base in Singapore? Talk to us.

Ready to start your business?

Our expert team is here to help you. Explore our incorporation services or contact our team to get personalised advice today.

Start a business in less than 3 hours with us. Talk to our experts today.

Got questions?

Get them answered for FREE by our experts.

Become a part of the Sleek Community now!

Other articles that might interest you

Related content


We'd love to help. Share your contact details and we'll call you back


Start a business in less than 3 hours with us. Talk to our experts today.

Chat with us on WhatsApp from your mobile

Sleek SG QR Code Whatsapp
30D money back

30 Days Money Back Guarantee

Our refund policy:

We care about you – within 30 days from your purchase, if you’re unhappy with our services, we’ll refund our fee. Email or call us, and we’ll process the refund within five working days.

What it doesn’t cover:

We will not be able to refund Government fees once the application has been submitted, nor any third-party processing fees.

When it applies:

We cannot guarantee any specific legal outcomes when you use our services. For instance, a company registration might be filed correctly but still get rejected by the Company Registry for reasons beyond our control. We can only refund our fees for issues we are directly responsible for. In the case that you purchase a service and later change your mind, we can’t issue a refund.

Our customer support team is at your disposal for any questions or issue you may face.

Need help?

Our sales team is available from Mon - Fri 9am to 10pm (Singapore Time)

Let's get in touch

Book a time with our experts to guide you in finding the best solution.