For both resident and non-resident companies, corporate income tax (CIT) is imposed on income accruing in or derived from Malaysia. The current CIT rates are provided in the following table:
|Type of company
||Chargeable income (MYR)
||CIT rate for year of assessment (%)
|Resident company (other than company described below)
- with paid-up capital of 2.5 million Malaysian ringgit (MYR) or less
- that does not control, directly or indirectly, another company that has paid-up capital of more than MYR 2.5 million, and
- is not controlled, directly or indirectly, by another company that has paid-up capital of more than MYR 2.5 million.
|On the first 500,000
|In excess of 500,000
* For years of assessment 2017 and 2018, CIT is reduced based on the incremental chargeable income for companies, limited liability partnerships, trust bodies, executor of estate of an individual domiciled outside Malaysia at the time of death, and receiver appointed by the court. The following rates are applicable:
|% of increase in chargeable income compared to immediate preceding year of assessment
||% point reduction
||Income tax rate applicable for incremental portion of chargeable income (%)
|Less than 5.00
|5.00 to 9.99
|10.00 to 14.99
|15.00 to 19.99
|20.00 and above
Petroleum income tax
Petroleum income tax is imposed at the rate of 38% on income from petroleum operations in Malaysia. An effective petroleum income tax rate of 25% applies on income from petroleum operations in marginal fields. No other taxes are imposed on income from petroleum operations.
Local income taxes
There are no other local, state, or provincial government taxes on income in Malaysia.