Sole proprietorship is a type of business organization in Malaysia. The business is owned by one person.

It is the simplest form of business organization with minimal legal requirements.

Only a Malaysian citizen and a permanent resident can register a business as sole proprietor.

Being your own boss is a lot of satisfaction in working for yourself.

Sole proprietorship can be started fairly easily with minimal capital requirements.

The owner receives all the profits and can exercise his entrepreneurial skills to the full. No public disclosure of accounts is required and business affairs can be kept private.

As the owner of the business, you can make decisions and run the business the way you wish. You will normally retain your customers by having "personal" contact with them.

You will have to bear unlimited liability for any losses incurred by the business. You are responsible entirely for the debts of the business.

A person is normally skillful in one or two key areas of the business. Thus your expertise is limited. To be a successful owner you will need to obtain relevant advice from other experts.

Your funds may be inadequate if you wish to expand rapidly. A sole proprietor's main source of funds is usually the savings. Even credit obtained from suppliers may only be on a short-term basis.

Operating as a sole trader, you will find it difficult to take days off for holidays. You may have to work long hours.

The firm will cease business once the owner dies.

You can either use your own name as stated in your National Registration Identification Certificate (e.g. Ali Bin Sulaiman or Lee Kim Lim) or a trade name (e.g. ABC Enterprise or ABC Import-export Agency) for your business.

In West Malaysia, if you register using your own name, you do not need to apply for a business name approval. However, if you wish to have a business name, you must apply for approval using the "Application of Business Name Form" before registering your business.

In Sabah, you do not need to apply for business name approval - be it your own name or business name. You only provide the name during the registration.

Please note that there are certain names that cannot be registered as business names.

You cannot register the name of a person who is not the owner of the business. Names that has been registered by others are not allowed.

You are also prohibited to register names that contain words which implicate connection with government agencies or department, country and state. Business names cannot contain the word "Royal", "Diraja", "National", "Nasional", "Cooperative", "Koperasi" and "Chartered".

Names using words that may be interpreted as being registered under any other law such as Companies Act, Societies Act or body corporate by "Royal Charter" or any local authority cannot be registered too.

The Registrar of Business, Municipal Council and Dewan Bandaraya have the rights to reject application for name which in their opinion is misleading as to the nature, scope or importance of the business carried on or to be carried on under such name.

The application procedure is simple for a sole proprietorship.

You must register your business as soon as it commences business. Therefore, you are require to register business which is in existence or business that has commenced. It is an offence for not registering your business.

Application procedure in West Malaysia is slightly different from the state of Sabah, East Malaysia. In all application, ball point pen must be used when filling in forms.

Fill up the form accordingly. "Form A" must be verified by the associates of the business and the signature attested by either a member of Parliament, member of the Dewan Undangan Negeri, judge, magistrate, advocates or solicitors, village headman, Justice of the Peace (J.P) or Commissioner for Oaths. Attach a copy of your NRIC with "Form A"

The registration fee for a sole proprietorship business is RM25.00 per annum for those using their personal name and RM50.00 per annum for using a business name. There is an additional fee of RM1.00 for each branch registered and RM5.00 for a copy of registered business information.

A "Certificate of Registration" will be issued for all successful applications.

You must then display the "Certificate of Registration" at the business premise.

The registration fee for a sole proprietorship business is RM25.00 per annum and RM5.00 processing fee for both personal name and business name.

A "Trading License" or "Form B" will be issued for all successful applications.

Your "Trading License" should be display at the business premise.

In West Malaysia, the "Certificate of Registration" is valid for one year from the registered date and shall be renewed annually. Renewal fee is RM25.00 and additional fee of RM1.00 for each branch.

In Sabah, the "Trading License" is valid until 31st December of each year from the registered date. Thus new applicant will normally be charged a pro rata registration fee based on the date of your application. Renewal will costs RM25.00.

"Certificate of Registration" can be renewed at any of the Registrar of Business, branches, post office or by mail by presenting Business Registration Number with renewal payment.

"Trading License" for the state of Sabah can be renewed at the Municipal Council, Majlis Perbandaran or Dewan Bandaraya by submitting the "Form P.L.B.(1)" together with renewal payment and your "Trading License".

You can renew your license or certificate at the earliest three (3) months before the date of expiry. Late renewal of business registration is an offence and can be compounded.

Failure to submit changes in business particulars is an offence and can be compounded.

For businesses in West Malaysia, you should obtain the "Form B" for Changes of Business Particulars Form. There are four (4) types of "Form B" -- "B1" for changes in the principal address of the business, "B2" for changes in particular types of business, "B3" for changes in the particulars of branch and "B4" for changes in the particulars of partner.

You will be charged a registration fee RM5.00 per "Form B" submission and an additional RM1.00 each branch. There is also RM5.00 for a copy of information regarding a registered business.

In Sabah, you proceed to the Municipal Council or Dewan Bandaraya and obtain the "Notice Of Change In Particulars" or "Form C". You'll have to pay RM2.00 for processing fee.

You should notify the Municipal Council or Dewan Bandaraya in writing.

For businesses registered with Registrar of Business or ROB, you'll have to fill in the Notification of Disclosure of Business "Form C" within 14 days from the date of termination. Registration of "Form C" is free.

It is an offence for failure to notify the Registrar of Business or Municipal Council or Dewan Bandaraya for business that has ceased operation.

If the business terminates due to the death of the owner, personal representative or the heir may notify the organization concerned or file in "Form C" within 30 days from the date of death.

No. This is a disadvantage of Sole Proprietorship.

You must apply for a new registration of business at the nearest office of Registrar of Business or Municipal Council or Dewan Bandaraya.