Investment Holding In Real Property Companies in Malaysia

An investment holding company is a company that holds shares of other companies as investments. The shares are usually held for a long-term period and the company does not have any active role in the management of the investee companies.

In Malaysia, investment holding companies are commonly used as holding vehicles for real estate companies. This is because real estate companies are subject to certain restrictions under Malaysian law, such as the requirement that at least 70% of the company’s assets must be held in real estate.

By holding shares in a real estate company through an investment holding company, the ultimate owner of the real estate company can avoid these restrictions. The investment holding company can also provide some degree of protection for the assets of the real estate company, as the assets of the investment holding company are not subject to the same restrictions as the assets of the real estate company.

However, it should be noted that the investment holding company itself is subject to certain taxes, such as stamp duty and capital gains tax. As such, the use of an investment holding company as a holding vehicle for a real estate company should be carefully considered in light of the overall tax implications.