A Quick Guide To Foreign Owned Companies In Malaysia vs Thailand

Let us start by saving you time: If you’re set on Malaysia as the location for your foreign-owned company, nothing in this or any other guide will change your mind.

And the same goes if you’ve decided on Thailand!

However, if you’re truly undecided between them, we hope our no-fluff comparison table based on metrics that matter can help you choose.

Metric	Malaysia	Thailand
100% foreign ownership	Allowed	Generally not allowed and capped at 49% Exceptions: 1. Apply for Foreign Business Licence (FBL) — THB 2 million capital minimum 2. Qualify for Thailand Board of Investment (BOI) — minimum THB 1 million (excluding land & working capital) 3. US citizens and companies may have special exemptions
Resident director requirement	Yes, at least one director must have principal place of residence in Malaysia	Not needed
Can operate remotely (with nominee director)	Yes	Yes
Personal income tax rate for expat directors	Progressive from 0–30%	Progressive from 0–35%
Corporate tax rate for foreign-owned companies	24%	0–20% depending on net profit
Corporate tax rate for JV with local partner / special thresholds	If foreign-owned <20% local partner: 15% on first RM150,000 17% on RM150,001–RM600,000 24% above RM600,000	No difference
Dividend withholding tax (for foreign shareholders)	0% if covered by DTA; otherwise up to 15% for non-residents	Generally 10%
SST / GST / VAT rate	5–10% Sales Tax and 6–8% Service Tax	7% VAT
Minimum paid-up capital	RM1 (though banks / visa / licenses may require more)	None officially, but often determined by visa or licensing needs
Director visa	Category 1 Employment Pass: Requires minimum RM500,000 paid-up capital Valid 1–5 years per renewal	Non-Immigrant Visa B: Must meet financial and salary requirements Valid 1–3 years per renewal
Employer contribution to provident fund	13% if ≤ RM5,000 12% if > RM5,000	5%

Here’s our take, for what it’s worth!

Cost-wise, Thailand edges Malaysia whether you plan to migrate or operate your company remotely. Even with the BOI or Foreign Business Licence (FBL) route, Thailand’s financial requirements are lower compared to Malaysia, where you’ll need at least RM500,000 in paid-up capital to qualify for a Category 1 Employment Pass.

Even if you run things from abroad, Thailand still comes out cheaper since there’s no resident director requirement, while in Malaysia you’ll have to appoint a nominee, adding cost and risk.

So while MISHU ourselves assists foreigners with incorporating foreign companies in Malaysia, if you are on the fence, we have to admit Thailand makes a very strong case for itself.