Malaysia

Individual - Other taxes

Last reviewed - 16 June 2026

Social security contributions

Employees’ Provident Fund (EPF)

The Malaysian EPF is a compulsory retirement savings scheme for employees working in Malaysia. The EPF receives and manages retirement savings, encompassing mandatory contributions by all employees working in Malaysia, including Malaysian citizens, permanent residents (PR), and non-Malaysian citizens. Contribution rates vary based on the employee's citizenship status, age, and monthly wages, as summarised below:

Category	Wages	% of contribution of employee’s wages (minimum)
		Below 60 years old	Age 60 and above
Malaysian	≤ MYR 5,000	Employer: 13% Employee: 11%	Employer: 4% Employee: 0%
	> MYR 5,000	Employer: 12% Employee: 11%
PR and non-Malaysians (elected to contribute before 1 August 1998)	≤ MYR 5,000	Employer: 13% Employee: 11%	Employer: 6.5% Employee: 5.5%
	> MYR 5,000	Employer: 12% Employee: 11%	Employer: 6% Employee: 5.5%
Non-Malaysians	No limit	Employer: 2% Employee: 2%

Social Security Organisation (SOCSO)

Malaysia also has a SOCSO which several social security protection schemes for employees in Malaysia. Its coverage extends beyond Malaysian citizens and permanent residents, as foreign workers, including expatriates and foreign domestic workers, may also fall within the scope of the Employment Injury Scheme and the Invalidity Scheme, depending on the nature of their employment or assignment arrangement. Accordingly, the applicability of SOCSO requirements should be considered on a case-by-case basis. Effective 1 June 2026, this protection has been expanded through the Non-Employment Injury Scheme, which provides coverage for accidents that occur outside working hours for eligible employees. The key SOCSO related schemes include:

Employment Injury Scheme (EIS) and Invalidity Scheme (IS)

Both the employer and employee make monthly contributions to EIS and IS. The sum is based on the employee’s monthly wages and is restricted to a maximum of MYR 104.15 for the employer and MYR 29.75 for the employee.
The employer makes a contribution to EIS only for employees who are not eligible to be covered under the IS, with the amount restricted to a monthly maximum of MYR 74.40.

Employment Insurance System

The Employment Insurance System provides certain benefits and a re-employment placement programme for insured persons in the event of loss of employment to promote active labour market policies. The Employment Insurance System covers only Malaysian citizens, permanent residents, and temporary residents.

Both the employer and employee make monthly contributions of 0.2% of employee's wage, restricted to a maximum of MYR 11.90, respectively.

Non-Employment Injury Scheme (NIS)

The NIS provides eligible employees with 24-hour protection for personal injuries caused by accidents that occur outside working hours and are not directly related to their employment duties. The contribution is 0.75% of the employee’s salary for the first two years, capped at MYR 44.65 (based on a salary ceiling of MYR 6,000). The contribution rates will then gradually increase to 1.25% from the sixth year onwards. The scheme excludes, among others, accidents occurring outside Malaysia and certain cases involving foreign workers who misuse or breach the conditions of their valid passes or permits.

Real property gains tax (RPGT)

RPGT is charged upon gains from disposals of real property or shares in a real property company. See the Other taxes section in the Corporate tax summary. RPGT is imposed on individuals as follows:

Disposal	Citizens and permanent residents	Non-citizens/non-permanent residents	Non-citizens/non-permanent residents (preferential rates*)
Up to 3 years	30%	30%	30%
In the 4th year	20%	30%	20%
In the 5th year	15%	30%	15%
Exceeding 5 years	0%	10%	0%

* The preferential RPGT rates are applicable for sale and purchase agreements for disposal of real property in Pulau 1 of the Forest City Special Financial Zone, executed from 1 September 2024 to 31 July 2034 and duly stamped before 1 September 2034.

Consumption taxes

Sales tax and service tax

Sales tax is generally an ad valorem tax. The ad valorem rates are 5% or 10% depending on the class of goods.

The rate of service tax is 8% for all taxable services except for the following, which are at 6%:

Provision of food and beverage services.
Telecommunication services.
Parking services.
Logistics services.

Effective from 1 July 2025, the scope of service tax will be expanded to include new taxable services, such education services, and private healthcare services for non-Malaysians, with rates of 6% or 8%.

Net wealth/worth taxes

There are no net wealth/worth taxes in Malaysia.

Inheritance, estate, and gift taxes

There are no inheritance, estate, or gift taxes in Malaysia.

Property tax

Property tax is levied on the gross annual value of property as determined by the local state authorities.

Excise duties

Excise duties are imposed on a selected range of goods manufactured and imported into Malaysia. Goods that are subject to excise duty include beer/stout, cider and perry, rice wine, mead, un-denatured ethyl alcohol, brandy, whisky, rum and tafia, gin, cigarettes containing tobacco, motor vehicles, motorcycles, playing cards, and mahjong tiles. See the Other taxes section in the Corporate tax summary for rates and more information.

Stamp duty

Malaysia imposes stamp duty, which is payable by the buyer/transferee, on chargeable instruments. See the Other taxes section in the Corporate tax summary for rates and more information.

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