Living in Malaysia, Running a Singapore Company: Legal & Tax Implications

Many expatriates may feel that Malaysia offers a lower cost of living and may want to live in Malaysia and cross the causeway every morning more conveniently. This is completely understandable and we would like to help you by creating a list of a few measures that you should take to safeguard yourself from legal consequences.

Legal

Under the Singapore Companies Act, every company must have at least one locally resident director (citizen, PR, or valid Employment Pass holder).
Ensure that you file the necessary documents with Accounting and Corporate Regulatory Authority (ACRA)
If you employ any staff in Singapore, ensure that you have proper documentation.

Tax

Corporate Tax

- Tax residency of the company is based on where management and control take place (usually board meetings).
- If central management and control (typically board meetings) is exercised in Singapore, the company is likely to be treated as a Singapore tax resident.
- Corporate tax rate: 17% flat, but Singapore also offers partial tax exemptions and start-up exemptions for qualifying new companies.
Personal Tax

- If you’re drawing a salary from your Singapore company but living in Malaysia, you may be taxed in Singapore
- Possible exposure to Malaysian personal tax if you’re physically present in Malaysia for more than 182 days
- Singapore and Malaysia have a Double Taxation Agreement (DTA) to prevent double taxing.

Conclusion

Living in Malaysia while working in Singapore can be a prudent choice that allows you to take advantage of both worlds. To help you understand the legislature and taxation laws we have crafted this article. However This article provides general information and does not constitute legal advice. Please seek professional advice for your specific situation.

For more information regarding taxation and legal advice please book a consult with Legal Expat SG.