| BUSINESS | BUSINESS | COMPANY | LIMITED LIABILITY PARTNERSHIPS (LLP) | |
| Partnership | Sole Proprietorship | |||
| Capital Contribution | Partners | Own contribution | Capital | Partners |
| Ownership | Owned by two (2) or more persons but not exceeding 20 persons | Wholly owned by a single individual | Private Company At least one (1) director who ordinarily resides in Malaysia by having a principal address of residence in Malaysia and one (1) shareholder. Public Company At least two (2) directors who ordinarily reside in Malaysia by having a principal address of residence in Malaysia and a minimum of one (1) shareholder. | - At least two (2) persons (wholly or partly, individual or corporate body) - Unlimited for the number of partners |
| Legal Status | Not a separate legal entity | Not a separate legal entity | Separate legal entity | Separate legal entity |
| Liability Party (responsible for debt) | Partners | Partners | Company (liability is limited to the number of shares invested or guaranteed) | LLP |
| Management Responsibilities | Partners | Partners | Board of Directors | Partners |
| Personal Liability | Unlimited liabilities (jointly and severally liable with partnership) which may include partner's personal assets | Liability to the owner is not limited to invested capital. It also includes the personal assets of a single owner | Private Company Limited By Shares (Sdn. Bhd., Public Company Limited By Shares (Berhad) & Company Limited by Guarantee No liability against directors or shareholders. The liability of members is limited to the amount of capital invested in the company Liabilities incurred by directors or shareholders to the extent of the non-paid capital | Conventional Partnership to LLPThe liability incurred is limited to an agreed agreement There is no liability to the partners except for wrongdoing or omission or without authority Private Limited Company to LLPThe partner’s liability is jointly and severally with LLP to the extent of the non-paid partner’s capital |
| Risk | Risk contribution to partners | Full risk on the business owner | Investment risk does not involve personal assets | Risk contribution to partners |
| Advantages and disadvantages | Advantages: Easy to set up Easy to get capital Disadvantages: Unlimited liability | Advantages: Easy to set up Disadvantages: Limited capital Unlimited liability | Advantages: Company shares may be traded with the approval of other shareholders Higher capital Long lifespan (owner and companies are separate entities) Shareholders are protected by law Disadvantages: Longer procedure of incorporation The cost of incorporation is quite high | Advantages: Limited liability Partners' asset is protected Disadvantages: An LLP must have at least two (2) members. If one (1) member chooses to leave the partnership, the LLP may have to be dissolved. |
| Taxation | Income tax | Income tax | Corporate tax Income tax on individual shareholders | Corporate tax Income tax on individual shareholders |
| Business Termination / Dissolution of Company | Easy to terminate and shorter procedure (no fees required) | Easy to terminate and shorter procedure (no fees required) | Takes a long time and procedure to dissolve the company | Takes a long time and procedure to dissolve the LLP |