Back in January, a newspaper article jolted the Malaysia e-commerce community when a blogger had challenges with her taxation. The shock to the community came when the IRB spokesman said:
…online businesses including via Facebook were bound by the Income Tax Act 1967 and their income were taxable just like fixed income.
Honestly, it’s not difficult to start an e-commerce business. If you were to budget out the online requirements, you’ll need:
- Domain name
- Website hosting
- E-commerce system
- Payment gateway
Depending on your budget, features and IT knowledge, you could kick off your own e-commerce store for as low as RM800. The bulk of the cost is from subscribing to a Malaysia payment gateway so you can accept local Internet banking transactions (Maybank2u and etc).
But how do you sustain your e-commerce business, is a different story I’ll not go into here. Instead, you may want to read the MCMC (Malaysian Communications and Multimedia Commission, also known as SKMM) feedback gave in regards to the policy by SSM (Companies Commission of Malaysia).
From my understanding, though both are within the government’s control, they have separate views on the matter. Sigh.
At the end of the day, the answer to the question:
Do I have to register my online e-commerce store with SSM?
The answer is, yes.
Although Webshaper did ask a lawyer friend to clarify the matter, I found the lawyer’s language too legal for my understanding. My interpretation to his statement:
…business registration is required for those businesses that are some what structured, premature and continuous in nature.
Is to be on the safe side, all online businesses should be registered unless you’re only doing it once. However, even my statement can be contradicted, because if I were to trade many different products on an ongoing basis, it’s like a trading business.
So, just register the sole-proprietorship and get an accountant to help you balance your taxes. End of story, and headaches.