SSM 2025 Compound Reduction Incentive: Strategic Opportunity for Companies and Directors to Settle Outstanding Compounds
 
In 2025, Companies Commission of Malaysia (SSM) introduced new initiative offering a 95% compound reduction incentive to help companies and their directors to settle outstanding compounds. This move is in line with the government's effort to promote corporate compliance, ease the financial burden on businesses, and facilitate the closure of inactive companies through a streamlined process.
 
Compound Reduction and Striking Off Initiative
This incentive is part of a campaign introduced under the Moratorium Period from 16 April 2025 to 30 September 2025. Companies that are no longer in operation and wish to strike off their names with SSM under Section 550 of the Companies Act 2016 can now do so with up to 95% reduction in compound fines. This initiative is designed to encourage corporate responsibility while enabling companies to formalize closure without being hindered by high compound amounts that may have accumulated over time.
 
Who can Apply for the incentive?
To qualify for the incentive, companies must meet the following conditions:
* Have ceased business operations and do not intend to operate business.
* No assets, liabilities, or outstanding charges.
* No outstanding tax or other liabilities with any Government Department or Agency.
* Must not be a holding company.
* Is not a housing developer.
* Is not a Guarantor Corporation
 
Applications must be submitted with a fee of RM100, along with supporting documents such as the latest management accounts, directors’ resolution, and consent letters from shareholders where required.
 
Appeal for Compound Reduction
Companies with outstanding compound fines must submit a formal written appeal to SSM.
 
Encouragement to Directors
SSM strongly encourages company directors to take advantage of this limited-time to settle outstanding compounds and ensure full regulatory compliance. This will help them to avoid potential legal consequences and make it easier to close down companies that are no longer in use with SSM. It’s important to act quickly, as the moratorium period ends on 30 September 2025.
 
Conclusion
SSM compound reduction initiative offers a valuable opportunity for companies and their directors to resolve past non-compliance regulation at a significant lower cost. This initiative reflects SSM’s commitment to supporting businesses and maintaining high standards of corporate governance.Directors are encouraged to act promptly to take advantage of this incentive before the deadline.

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