Malaysia tax
Tax residence: At least 182 days in calendar year. 3 special regimes for new residents: Exemption for foreign-source income received by resident individuals, MM2H: exemption of foreign funds and income and of fixed-deposit profit and Johor-Singapore Special Economic Zone: special 15% tax rate announced.
Checked against official sources on Change log
Tax residence
- At least 182 days in calendar year · Resident for tax in Malaysia if present 182 days or more in the year; linked-year and 90-day tests also exist.
- Residence follows physical presence in the basis year, not nationality or visa; presence in adjacent basis years can also count in certain situations (PR 2/2026 para 4.4). One condition of the non-resident short-employment exemption: employment in Malaysia not exceeding 60 days in total in a basis year (PR 2/2026 para 4.6.1).
Special regimes for new residents
Special regime
Malaysia: exemption for foreign-source income received by resident individuals (1 January 2022 to 31 December 2036)
Tax relief
Details
Resident individuals are exempt from tax on foreign-source income received in Malaysia from 1 January 2022 to 31 December 2036, except income from partnership businesses. Income from work performed in Malaysia is taxed at normal resident rates. 1 2 3 4
Taxed on
Foreign-source income received in Malaysia by an individual tax resident; Malaysian-source income (including pay for work exercised in Malaysia) is taxed under normal resident rates.
Who it applies to
- The individual is a Malaysian tax resident for the basis year, normally present 182 days or more.
- The income arises outside Malaysia and is received in Malaysia by the individual.
- The income is not partnership business income.
Exclusions
- Income from work exercised in Malaysia is Malaysian-source whoever pays it and is taxed under the resident scale rates.
- Partnership business income is outside the individual exemption.
Days in the country
- At least 182 days in calendar year · Resident for tax in Malaysia if present 182 days or more in the year; linked-year and 90-day tests also exist.
Tax residence
Residence follows physical presence of 182 days or more in the basis year; linked-year and 90-day tests also exist.
Visas
No visa grants this exemption; it applies to any tax-resident individual. MM2H separately states a tax exemption on foreign funds and income.
Other taxes
Sales and service tax, employee contributions and withholding tax are separate.
Checked against official sources on Change log
Special regime
MM2H: exemption of foreign funds and income and of fixed-deposit profit
Tax relief
Details
- On: Foreign funds and income remitted to Malaysia
- Who: Hold an MM2H pass in the Platinum, Gold, Silver or SEZ/SFZ category
Participants in all MM2H categories are not taxed on foreign funds or income remitted to Malaysia, or on profit earned on their Malaysian fixed deposit. 6 7 3
Taxed on
Foreign funds and income remitted to Malaysia, and profit earned on the MM2H fixed deposit in Malaysia.
Who it applies to
- Hold an MM2H pass in the Platinum, Gold, Silver or SEZ/SFZ category.
Exclusions
- Income from employment or business in Malaysia is not covered by the stated exemption.
Days in the country
- At least 182 days in calendar year · Tax residence in Malaysia follows presence of 182 days or more.
Tax residence
MM2H participants under 50 must be present 90 days a year for the pass; tax residence is tested separately by days of presence.
Visas
Attached to the MM2H pass.
Other taxes
Sales and service tax, quit rent, assessment and property taxes apply separately.
Checked against official sources on Change log
Special regime
Johor-Singapore Special Economic Zone: special 15% tax rate announced for eligible knowledge workers
15% tax
Details
- Who: The release says only "eligible knowledge workers working in JS-SEZ"
The Ministry of Finance announced on 8 January 2025 a special tax rate of 15% for 10 years for eligible knowledge workers working in the Johor-Singapore Special Economic Zone. The release does not say who is eligible or which income the rate covers, and says further details will be announced. 8
Who it applies to
- The release says only "eligible knowledge workers working in JS-SEZ"; it does not set out the eligibility criteria.
- The release lists the rate among incentives effective 1 January 2025 and says further details on the tax incentives will be announced in due course.
Tax residence
The release says nothing about tax residence or when the 10 years start for a worker.
Visas
The release does not link the rate to a visa or pass.
Checked against official sources on , some details partly verifiedChange log
Which visas the regimes apply to
- MM2H: exemption of foreign funds and income and of fixed-deposit profit: MM2H Platinum, MM2H Gold, MM2H Silver, MM2H SEZ. Attached to the MM2H pass.
Standard rules and foreign-source income
Standard rules
Malaysia resident individual income tax: 0-30% scale rates (Year of Assessment 2025)
Details
- Limit: MYR 5,000/yr ≈ $1,220
A Malaysian tax resident (182 days or more in the basis year) pays scale rates from 0% to 30% on chargeable income and may claim personal reliefs; a non-resident pays a flat 30% with no reliefs. Foreign-source income received in Malaysia by resident individuals is exempt from 1 January 2022 to 31 December 2036, except partnership business income; Malaysian-source employment income is taxed under the scale rates. 5 4
Taxed on
Chargeable income of an individual (income from Malaysian sources and, unless exempt, foreign-source income received in Malaysia). Scale for Year of Assessment 2023, 2024 and 2025: 0% on the first RM5,000; 1% on the next RM15,000; 3% on the next RM15,000; 6% on the next RM15,000; 11% on the next RM20,000; 19% on the next RM30,000; 25% on the next RM300,000; 26% on the next RM200,000; 28% on the next RM1,400,000; 30% above RM2,000,000. Non-residents: flat 30%. Top marginal rate shown as ratePercent.
Who it applies to
- Resident for a basis year: physical presence in Malaysia of 182 days or more in the basis year; generally non-resident if present fewer than 182 days (Public Ruling 2/2026 para 4.4, with PR 11/2017 on the full residence rules).
- Resident individuals are eligible for personal tax reliefs under sections 45A to 49 of the Income Tax Act 1967 and are taxed at the scale rates of Schedule 1.
Exclusions
- Non-resident individuals pay a flat 30% on chargeable income and cannot claim personal reliefs.
- Employment income of a non-resident exercised in Malaysia is exempt under paragraph 21 of Schedule 6 where the conditions in PR 2/2026 para 4.6.1 are met, including employment of no more than 60 days in total in the basis year.
Limits
- MYR 5,000 a year (≈ $1,220) · 0% on the first RM5,000 of chargeable income
- MYR 20,000 a year (≈ $4,900) · 1% on the next RM15,000 (RM5,001 to RM20,000)
- MYR 35,000 a year (≈ $8,570) · 3% on the next RM15,000 (RM20,001 to RM35,000)
- MYR 50,000 a year (≈ $12,200) · 6% on the next RM15,000 (RM35,001 to RM50,000)
- MYR 70,000 a year (≈ $17,100) · 11% on the next RM20,000 (RM50,001 to RM70,000)
- MYR 100,000 a year (≈ $24,500) · 19% on the next RM30,000 (RM70,001 to RM100,000)
- MYR 400,000 a year (≈ $98,000) · 25% on the next RM300,000 (RM100,001 to RM400,000)
- MYR 600,000 a year (≈ $147,000) · 26% on the next RM200,000 (RM400,001 to RM600,000)
- MYR 2,000,000 a year (≈ $490,000) · 28% on the next RM1,400,000 (RM600,001 to RM2,000,000); 30% above RM2,000,000
Days in the country
- At least 182 days in basis year (calendar year) · Presence in Malaysia of 182 days or more makes an individual resident; fewer than 182 days generally means non-resident.
Tax residence
Residence follows physical presence in the basis year, not nationality or visa; presence in adjacent basis years can also count in certain situations (PR 2/2026 para 4.4). One condition of the non-resident short-employment exemption: employment in Malaysia not exceeding 60 days in total in a basis year (PR 2/2026 para 4.6.1).
Visas
Visa or work-pass type does not set tax residence; days of presence do.
Other taxes
Foreign-source income received in Malaysia by resident individuals is covered by “Malaysia: exemption for foreign-source income received by resident individuals”. Sales and service tax and social contributions apply separately.
Checked against official sources on Change log
VAT, social security and other taxes
- Sales and service tax, employee contributions and withholding tax are separate.
- Foreign-source income received in Malaysia by resident individuals is covered by “Malaysia: exemption for foreign-source income received by resident individuals”. Sales and service tax and social contributions apply separately.
- Sales and service tax, quit rent, assessment and property taxes apply separately.
Questions people ask
When do you become a tax resident in Malaysia?
At least 182 days in calendar year (Resident for tax in Malaysia if present 182 days or more in the year; linked-year and 90-day tests also exist). Residence follows physical presence in the basis year, not nationality or visa; presence in adjacent basis years can also count in certain situations (PR 2/2026 para 4.4).
Who qualifies for Exemption for foreign-source income received by resident individuals?
The individual is a Malaysian tax resident for the basis year, normally present 182 days or more. No visa grants this exemption; it applies to any tax-resident individual.
Who qualifies for MM2H: exemption of foreign funds and income and of fixed-deposit profit?
Hold an MM2H pass in the Platinum, Gold, Silver or SEZ/SFZ category. Attached to the MM2H pass.
Who qualifies for Johor-Singapore Special Economic Zone: special 15% tax rate announced?
The release says only "eligible knowledge workers working in JS-SEZ"; it does not set out the eligibility criteria. The release does not link the rate to a visa or pass.
How are DE Rantau nomad pass holders taxed in Malaysia?
No special regime in our records is tied to the DE Rantau nomad pass. The standard rules apply: A Malaysian tax resident (182 days or more in the basis year) pays scale rates from 0% to 30% on chargeable income and may claim personal reliefs; a non-resident pays a flat 30% with no reliefs. Foreign-source income received in Malaysia by resident individuals is exempt from 1 January 2022 to 31 December 2036, except partnership business income; Malaysian-source employment income is taxed under the scale rates.
Is there a tax break for MM2H Gold holders in Malaysia?
MM2H: exemption of foreign funds and income and of fixed-deposit profit: Participants in all MM2H categories are not taxed on foreign funds or income remitted to Malaysia, or on profit earned on their Malaysian fixed deposit. It's separate from the visa and has its own conditions.
≈ USD figures are approximate: daily reference rates from ExchangeRate-API, dated 12 Oct 2026, refreshed when the site is updated.
Sources (8)
Official sources
- Income Tax (Exemption) (No.5) Order 2022 (Amendment) Order 2024, P.U.(A) 451/2024 · Parliament of Malaysia · checked 2026-10-10 · published 2024-12-24
- Budget 2026 tax measures: foreign-sourced income exemption for individuals to 31 December 2036 · Ministry of Finance Malaysia · checked 2026-10-10 · published 2025-10-10
- Residence Status of Individuals, section 7 Income Tax Act 1967 · Inland Revenue Board of Malaysia (HASiL) · checked 2026-10-10
- Public Ruling No. 2/2026: tax treatment of foreign nationals exercising employment in Malaysia · Inland Revenue Board of Malaysia · checked 2026-10-10
- Tax Rate: resident individual rates, Year of Assessment 2023, 2024 and 2025 · Inland Revenue Board of Malaysia (LHDN) · checked 2026-10-10
- MM2H Category Overview and requirements · Ministry of Tourism, Arts and Culture · checked 2026-10-10
- MM2H Guidelines · Ministry of Tourism, Arts and Culture · checked 2026-10-10
- Johor-Singapore Special Economic Zone incentive package press release, 8 January 2025 · Ministry of Finance Malaysia · checked 2026-10-10 · published 2025-01-08