Malaysia Corporate Tax Rate
- managementkalyx
- Jul 23
- 2 min read
Updated: Sep 25
In Malaysia, one of the primary reasons business owners opt to establish private limited companies, such as Sdn Bhd (Sendirian Berhad), PLT (Partnership Limited by Shares), or Berhad (public limited company), is indeed to benefit from tax efficiency.
Private limited companies typically enjoy lower corporate tax rates compared to personal income tax rates, allowing business owners to retain more profits within the company. This structure can lead to significant tax savings, especially for those with higher personal income tax brackets.
Corporate Tax Rate (YA 2024 and onwards)
The Inland Revenue Board (LHDN) applies differentiated tax rates based on company size and residency status. The current tax structure for the Year of Assessment 2024 and onwards is as follows:
Details | Net Chargeable Income | Tax Rate |
|---|---|---|
Paid Up Capital less than RM 2.5 mil Gross Business Income less than RM 50 mil | First RM 150,000 RM 150,001 - RM 600,000 RM 600,001 and above | 15% 17% 24% |
Paid Up Capital more than RM 2.5 mil Gross Business Income more than 50 mil Non-Resident Company | - | 24% |
Corporate Tax Rate 2024
Condition to enjoy Preferential Tax Rate (15%)
MUST be Malaysian Resident Company
Paid Up Capital NOT more than RM 2.5mil
Income from business sources NOT more than RM 50mil
If the company has a holding company, them holding company need to be
Malaysian Resident Company
No more than 20% of shares hold by foreign companies or NON-Malaysian citizens, either directly or indirectly.
Holding Company
A holding company is a company that owns more than 50% of another company's shares, giving it control over that company. For example, if Company A owns over 50% of Company B, then Company A is the holding company of Company B
