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Income tax in Malaysia 2026
You climb from 0% on the first MYR 5,000 through ten steps to 30% above MYR 2 million — and a middle earner on MYR 100,000 has an average rate of under 10%.
The base is territorial: Malaysian income is taxed, while foreign income you bring in stays exempt until end-2036 where the subject-to-tax condition is met — actual foreign tax or qualifying source-country exemptions both count.
At a glance
- top rate
- 30% above MYR 2 million
- entry band
- 0% on the first MYR 5,000, then 1% to MYR 20,000
- tax year basis
- Calendar year
- filing deadline
- 30 April, or 30 June with business income
- residency basis
- Territorial; resident at 182 days (with linking rules)
- regime flag
- Flat 15% routes: returning experts (5 years), global services hub staff, Iskandar knowledge workers
Rates
Resident income tax scale (2026)
| Taxable income (MYR) | Rate | Tax on all bands below (MYR) |
|---|---|---|
| 0 – 5,000 | 0% | 0 |
| 5,001 – 20,000 | 1% | 0 |
| 20,001 – 35,000 | 3% | 150 |
| 35,001 – 50,000 | 6% | 600 |
| 50,001 – 70,000 | 11% | 1,500 |
| 70,001 – 100,000 | 19% | 3,700 |
| 100,001 – 400,000 | 25% | 9,400 |
| 400,001 – 600,000 | 26% | 84,400 |
| 600,001 – 2,000,000 | 28% | 136,400 |
| Over 2,000,000 | 30% | 528,400 |
Marginal rates apply within each band.
Thresholds & allowances
- Personal allowanceMYR 9,000
Plus MYR 7,000 if disabled
- Spouse allowanceMYR 4,000
Under joint assessment; MYR 5,000 more for a disabled spouse
- ChildrenMYR 2,000 – 14,000
MYR 2,000 under 18; MYR 8,000 in full-time tertiary study; up to MYR 14,000 for a disabled child studying
- Retirement fund contributionsMYR 4,000
Plus MYR 3,000 for private retirement schemes and deferred annuities (to 2030), and MYR 3,000 for life insurance
- Medical expensesUp to MYR 8,000
Serious illness and fertility treatment; sub-caps for check-ups, dental and mental-health care
- Lifestyle reliefMYR 2,500
Books, computers, phones, internet and courses; MYR 1,000 more for sports spending
- Education fees (self)Up to MYR 7,000
Approved courses; upskilling classes capped at MYR 2,000 through 2026
- Childcare and education savingsMYR 3,000 / MYR 8,000
Childcare fees for children up to 12 (from 2026); National Education Savings Scheme deposits to 2027
- Low-income rebateMYR 400
If chargeable income is MYR 35,000 or less; a further MYR 400 for the spouse under joint assessment
Residency
Residency trigger
You are resident after 182 days in Malaysia in the year — or a shorter stay linked to a 182-day run next door in the adjacent year, or 90 days with enough history, or through surrounding resident years. Residents pay on Malaysian income; foreign income brought in is exempt to end-2036 if taxed at origin.
Non-resident treatment
Non-residents pay a flat 30% on Malaysian income with no allowances. Employment of under 60 days in a year is not taxed at all, and foreign income they remit is exempt.
Notes
- Salary earners file by 30 April and are largely settled through monthly payroll deductions; anyone with business income files by 30 June and pays bimonthly instalments.
- Couples are assessed separately by default — joint assessment is an option and brings the MYR 4,000 spouse allowance.
- The foreign-income exemption needs proof the money was taxed at origin, or that it escaped only through the origin country's own system, thresholds or incentives.
- Business losses carry forward 10 years against business income; they cannot be carried back.
- Malaysian experts returning home can elect a flat 15% on employment income for 5 years; Iskandar Development Region knowledge workers and up to 3 senior global-services-hub hires (salary MYR 35,000+/month) also get 15%.
FAQ
What is the top income tax rate in Malaysia?
30%, on chargeable income above MYR 2 million; non-residents pay a flat 30% from the first ringgit.
Does Malaysia tax foreign income?
Foreign income you bring into Malaysia is exempt until 31 December 2036, provided the subject-to-tax condition is met — actual tax abroad, or qualifying non-taxation (source-country exemptions, thresholds, incentives, or the absence of a comparable income tax); foreign capital gains of individuals are not taxed.
When are Malaysian tax returns due?
30 April of the following year for employment income, or 30 June if you have business income.
Figures: tax year 2026, compiled from public sources. Not tax advice.