Confused About Nature of Business? Here’s What It Means

What Does Nature of Business Mean?

It’s the short official description of what your company actually does, required during SSM registration.

It tells SSM and other authorities what your business activities are in plain terms, so they can tag your company with the right MSIC industry code.

This code affects more than you think such as:

• Bank account approvals
• Tax classification by LHDN
• Grant & licence eligibility
• Public company records

If you write “online business,” you could be anything from a dropshipper to a SaaS platform. Too vague, and your application may be delayed or queried. Too specific, and you might limit future pivots.

You will need this during incorporation via SSM’s MyCoID system, and again when dealing with LHDN, RMCD (for SST), banks, and sometimes EPF or SOCSO.

So yes, it’s really important you get this right because this is essentially your IC of business.

How to Find Your Nature of Business on SSM Forms (MyCoID)

When registering your company online through SSM’s MyCoID system, one of the required fields is “Nature of Business.” This section appears under the Super Form during company incorporation or updates. It asks two things:

1. A written business activity description
2. Your MSIC (Malaysia Standard Industrial Classification) code(s)

Here’s exactly how to find and fill it out correctly:

Step 1: Log in to MyCoID and Locate the “Nature of Business” Field

• Visit MyCoID Portal
• Select “Direct Incorporation of a Company” under your dashboard
• Proceed through the form until you reach the “Business Code and Description” section
• This is where you’ll input:
  • A written explanation ( “Retail sale of hair shampoo products via internet”)
  • 1–3 MSIC codes that reflect your business activities

Step 2: Describe What You Actually Do

Think practically, what do you sell, make, or offer?

Write your main business activity in plain English first. Don’t worry about codes yet.

Examples:

• “Selling baby clothes online”
• “Providing tax filing and accounting services”
• “Building websites for retail companies”

Focus on your core income-generating activity, not side hustles or future ideas.

Step 3: Look Up the Matching MSIC Code

Once you’ve described your activity, it’s time to find the official code used by the government.

You can search using these tools:

• DOSM MSIC Code Search Tool (Department of Statistics Malaysia)
• LHDN MSIC PDF List – especially useful if you plan to do e-Invoicing
• Your Company Secretary, most will handle this step for you

Find a 5-digit MSIC code that best represents your core business.

Step 4: Select 1–3 MSIC Codes

SSM lets you choose up to three MSIC codes:

You don’t need all 3 codes. Just make sure your main code is accurate.

Step 5: Write a Clear Description in the SSM Form

Once you’ve selected your codes, describe your nature of business clearly in simple, specific terms. The best way is to consider the following:

• Who you are serving
• What are you selling 
• Where you do conduct your business
• How did you deliver it

Use formats like:

• “Retail sale of clothing and accessories”
• “Event planning and corporate gifting services”
• “Digital marketing and social media advertising”

Simple and straight to the point. Avoid vague phrases like “general trading” or “miscellaneous services”,  they can cause rejection or bank delays.

Step 6: Match Code and Narrative

Make sure your written business description matches the MSIC code(s) exactly, word by word.

Mismatched information is the most common reason for SSM rejections or delays.

If your MSIC code describes one activity (retail), but your written narrative suggests something different (digital marketing), SSM may query your application or ask for clarification.

Why Matching Matters:

• SSM uses automated checks and officer review to spot inconsistencies
• Bank account openings and future compliance (like e-Invoicing) depend on accurate MSIC descriptions
• Mismatched info can delay your approval or force you to amend your application later

Example:

 After selecting your MSIC codes and writing your business description:

• Cross-check both for alignment
• Use phrases and keywords that mirror the MSIC code titles
• Get your company secretary to verify, they know what SSM officers look for

Can’t Find an Exact Match?

That’s okay, just choose the closest match that realistically reflects your day-to-day business.

You’re not stuck with it forever. You can always update or add codes later by submitting a board resolution via MyCoID.

Example Scenario: 

❌ “I sell on TikTok Shop, mostly fashion stuff.”

✅ “Online retail of jewellery and accessories” (MSIC 47912)

Sample MSIC Codes & Descriptions for Malaysian Businesses

What If Your Nature of Business Changes Later?

As your company grows, you might pivot, add new services, or shift your main income source, and that means your “Nature of Business” may need an update too.

The good news is, you can change it but you must do it properly.

If your actual business activity changes after incorporation, you’re legally required to update your records with SSM.

Pass a Board Resolution

Your company’s board must officially approve the change in nature of business (especially for Sdn Bhd). This shows it’s a formal, authorised update.

Submit the Change via MyCoID

Log in to the MyCoID portal and submit the update under the “Business Particulars” section. You may need to upload the board resolution document.

Align Your MSIC Codes

If your new business activity falls under different MSIC codes, update those too. Make sure they match your new main revenue activity.

When Do You Need to Update?

You must submit the change within 14 days from when your business activity changes, in line with SSM Practice Directive PD 2/2017.

Why It Matters:

• Keeps your SSM and LHDN records consistent
• Avoids compliance issues with tax classification and e-Invoicing
• Helps make sure your business licence and activities are valid
• Helps with banking, grants, and insurance applications

Conclusion: Nature of Business Is the Start

Choosing the right nature of business description isn’t just about ticking a box for SSM, it lays the groundwork for your company’s beginning.

But of course, that’s just the start.

If you’re serious about building a business that not only complies with SSM but also gets found on Google, it’s time to think beyond just incorporation. 

From SEO-friendly website builds to helping local businesses to get more foot traffic than they could ever need, Rankpage helps Malaysian SMEs turn their business ideas into digital traction.

Need help getting seen, not just registered? Let’s chat.