How Can Shares Be Transferred in a Malaysian Sdn. Bhd.?

Shares in a Malaysian private limited company (Sdn. Bhd.) can be transferred by executing a share transfer instrument, paying stamp duty, and registering the new shareholder in the company’s register of members.

What must foreign investors check before transferring shares?

Foreign investors should review the company’s constitution and shareholders’ agreements for restrictions on share transfers. These may include directors’ approval, consent from other shareholders, or pre-emption rights requiring existing shareholders to be offered the shares before an outside buyer.

Malaysia permits 100 percent foreign ownership in many sectors, but certain regulated activities impose ownership limits or require approval when control of a company changes. Existing business licenses should also be reviewed to determine whether the acquisition affects their validity.

Investors should verify the seller’s ownership of the shares, identify any pledges or other claims over them, and examine the company’s outstanding liabilities.

What is the process for transferring shares in Malaysia?

Preparing and signing the share transfer documents

The seller and buyer must execute an appropriate instrument of transfer identifying the shares and the parties involved.

For a sale, the parties may also sign a share sale and purchase agreement covering the purchase price, payment arrangements, and completion conditions, while the transfer instrument records the change in ownership for registration.

Paying stamp duty

The executed transfer instrument must be stamped under Malaysia’s Stamp Act 1949.

For unlisted shares, stamp duty is generally RM3 (US$0.73) for every RM1,000 (US$245) or part thereof, calculated on the higher of the purchase consideration or the applicable share value.

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For example, a transfer valued at RM1 million (US$244,942) would generally attract RM3,000 (US$735) in stamp duty. A higher assessed share value may increase the amount payable.

Instruments executed in Malaysia generally must be stamped within 30 days. Those executed overseas generally must be stamped within 30 days of first receipt in Malaysia.

Stamping is handled through the Inland Revenue Board of Malaysia (LHDN). Malaysia began phasing in its Stamp Duty Self-Assessment System (STSDS) on 1 January 2026, with electronic submission and assessment procedures depending on the instrument category.

Registering the transfer and updating company records

After receiving the stamped transfer instrument, the company generally has 30 days to register the transfer under Section 106 of the Companies Act 2016, unless statutory grounds permit refusal or delay.

Under Section 51, the company must notify the Companies Commission of Malaysia (SSM) within 14 days of the relevant change in its register of members.

Where the transfer affects beneficial ownership information, the company must update its beneficial ownership register and notify SSM within the applicable statutory deadlines.

The company secretary typically handles these registrations and notifications.

What taxes and additional costs should foreign investors consider?

A share disposal may attract capital gains tax (CGT) or Real Property Gains Tax (RPGT), depending on the seller’s status and the company’s assets.

Capital gains tax

Malaysia imposes CGT on qualifying disposals of unlisted shares by companies, limited liability partnerships, trust bodies, and cooperatives. Individuals selling shares held as capital investments are generally outside this regime.

For shares acquired before 1 January 2024, qualifying sellers may generally choose between:

• 10 percent of the chargeable gain; or
• 2 percent of the gross disposal price.

For shares acquired from 1 January 2024, the general rate is 10 percent of the chargeable gain.

Exemptions and other applicable conditions may affect the final liability. Foreign corporate sellers should also consider whether a tax treaty changes the treatment of their disposal.

LHDN issued updated guidance on CGT for unlisted shares on 21 September 2026, covering disposals, allowable costs, exemptions, and reporting requirements.

Real property gains tax

RPGT may apply when an individual disposes of shares in a real property company. This generally refers to a company whose Malaysian real property and shares in other real property companies represent at least 75 percent of its total tangible assets, subject to statutory conditions.

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Need assistance with share transfers or ownership restructuring in Malaysia? Speak with our team at Dezan Shira & Associates.

Since January 2024, qualifying corporate disposals of real property company shares generally fall under CGT rather than RPGT. Certain Labuan entities remain subject to RPGT.

For individual sellers, the applicable RPGT rate depends on their status and how long the shares have been held.

Professional and transaction costs

Additional costs may include legal documentation, share valuations, due diligence, and company secretarial fees.

Simplify your Malaysian share transfer with Dezan Shira & Associates

Dezan Shira & Associates assists foreign investors with share acquisitions, ownership restructuring, due diligence, and corporate compliance in Malaysia. Contact our team for assistance with transferring shares in a Malaysian Sdn. Bhd.

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