26th October 2026 - 8 min read
This checklist is for sole proprietors, who have 30 days from the day the business starts to register with the Companies Commission of Malaysia (SSM). Customer payments are easier to track in a separate business account, and banks ask for your registration documents to open one. So register before your first customer pays.
Running a business without registering can bring a fine of up to RM50,000, up to two years in jail, or both. A partnership has the same 30-day rule, but its documents differ.
SSM registration costs RM30 a year under your own name or RM60 under a trade name. You can apply online through the EzBiz portal, and applications are usually approved within one working day.
You choose how long your registration lasts, from one to five years, and you pay RM30 or RM60 for each year. Check the expiry date on your registration certificate and renew on time. Running a business after the registration expires carries the same penalty as not registering.
SSM registration doesn’t replace the licences and approvals your business may need. Section 5 of the Registration of Businesses Act 1956 says registration doesn’t mean you’ve met the requirements of any other law. Depending on what you sell and where you operate, you may also need a licence from your local council (PBT).
The process differs between councils. In Kuala Lumpur, for example, DBKL’s premise licence covers most business activity at a premise. Councils use the Ministry of Entrepreneur and Cooperatives Development’s home-based business guidelines. These ask for documents such as a copy of your SSM registration. Contact the council that covers your address before you take orders.
Home-based food sellers also have health requirements. The home-based business guidelines ask for a food handler training certificate from a school recognised by the Ministry of Health. They ask for proof of anti-typhoid vaccination. Your premises must be registered as a home-based food business in the Food Safety Information System of Malaysia (FoSIM). Confirm what applies to you with your council or the Ministry of Health.
After registering your business, open a separate business account so your sales don’t mix with your personal spending. Without a separate account, you may have to sort through your personal statements at tax time to find the business payments. For a home baker, that could mean separating cake payments from grocery purchases one transaction at a time.
Separate accounts also make it clearer which expenses you can claim for tax, as our tax guide for side businesses explains. A laptop bought for the business and paid from the business account shows up on the business statement next to its receipt. The same laptop paid on your personal card has to be found again at tax time.
To open an account, a sole proprietor can show Borang A (the registration form) and Borang D (the certificate SSM issues). Banks also ask for a copy of your MyKad and an opening deposit. The deposit varies by bank. RHB’s business current account asks for RM1,000 from a sole proprietorship. Maybank’s SME First Account takes RM100 online and RM1,000 at a branch.
Unlike the SSM fee, the deposit isn’t spent. It sits in your account afterwards, so you only need to have the money ready. Banks ask for different things, so check your bank’s list before you go.
With the account open, decide how customers can pay. Cash has no merchant discount rate (MDR), but electronic payments can carry one. An MDR is a percentage of each sale that you pay, so a 1% MDR costs RM1 on every RM100. The table shows each common method’s cost, according to our MDR explainer.
| Payment method | What it costs you |
| Cash | No MDR, but cash means trips to the bank and the risk of losing it |
| DuitNow QR | Often waived for small businesses. RHB charges 0.35% to 0.60% from 26 October 2026 |
| Debit and credit cards | MDR applies, and the rate varies by merchant type and business size |
Ask your bank or payment provider for the current MDR before you sign up for any electronic payment method.
DuitNow QR works through a standard QR code that you get by registering with your bank or a payment service provider. Customers scan the code to pay, and the money is credited to your bank account instantly. Bank Negara Malaysia said in September 2023 that micro and small businesses would continue to enjoy zero-cost transactions. From 26 October 2026, RHB will charge 0.35% on DuitNow QR payments from a bank account or e-wallet. It will charge 0.60% on payments from a credit card. This applies to its card terminals, Sound Box, and Reflex channels, according to RHB’s notice to merchants.
Your selling price has to cover the payment fee as well as the cost of making the product. Say a home baker sells a cake for RM120. Ingredients and packaging cost RM53, delivery costs RM10, and a 1% payment fee takes RM1.20. That leaves RM55.80 for her time and her other business costs. Work out the full cost of each sale before you set a price.
An invoice tells a customer how much they owe, and a receipt confirms that they’ve paid. A sale needs one or both, depending on whether the customer pays now or later. The Income Tax Act lists invoices, vouchers, and receipts among the records a business has to keep. A payment with no matching invoice or receipt is hard to prove later. You need the document if a customer says an order was already paid, or if LHDN asks about it.
Each invoice or receipt should show your business name and SSM registration number, so the customer can see who issued it. It should also show the date, what was sold, and the amount.
Give every invoice its own number and let the numbers run in order. Once your sales pass RM150,000 for goods or RM100,000 for services, section 82 of the Income Tax Act requires it. Include your business account details on the invoice so customers know where to send payment without asking you.
E-invoicing is LHDN’s electronic invoice system, and in most cases it’s compulsory only once yearly sales reach RM3 million. Until then, you can start with a simple invoice or receipt of your own.
Before you send your first invoice, decide whether to ask for a deposit and when payment is due. If you make products to order, ask for a deposit before you buy materials or start work. A cancelled order wastes materials and your time, and the deposit helps cover the loss.
The payment platform HitPay says deposits usually range from 30% to 50% of the order. It adds that the deposit should at least cover the cost of the raw materials for the order. Ask for the balance on collection or delivery. The amount is your decision, so state it when the customer places the order.
Payment terms tell a customer when to pay. Agree on the due date before you deliver anything. Write it on the invoice, such as “Due on delivery” or “Due 15 August”. A written date makes a late payment easier to follow up.
Bookkeeping starts with a record of every payment that comes in and goes out, plus the invoice or receipt behind it. You can start with a spreadsheet that has one row for each payment. The columns are the date and amount, who paid or was paid, and the invoice or receipt number.
The Income Tax Act requires a business to keep its records for seven years and to enter each transaction within 60 days. Updating your records every week keeps you within the 60-day rule.
You report business income on Form B and can claim business expenses against it. Proper records support those claims. Without them, you’d be rebuilding a year of income and expenses from bank statements and memory. Your first Form B covers this year’s income. It’s due by 30 June next year, or 15 July if you file online.
You can also pay someone to keep your books. CK Partners, an accounting firm, says bookkeeping for a sole proprietorship costs around RM150 to RM300 a month.
Before your first payment, you should have done the following.
If a customer wants to pay before you’re ready, finish the SSM registration, the local licence check, and the business account first.
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Iman writes about personal finance with curiosity. She is interested in the stories behind money, the hesitation around big decisions, and the small habits that shape financial futures. Off the clock, she is either dissecting a film or climbing her way up the leaderboard in her favourite games.
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