Tax · Updated 8 October 2026
Rental income tax in Malaysia 2026: residents and foreign owners
How rent from a Malaysian home is taxed: the 30% flat rate for non-residents, the progressive rates for residents, what you can deduct, how to file Form M or BE, and a calculator.
Calculator
Work out the tax on your rent
The example is a RM2,500-a-month condo with a loan, owned by a non-resident.
The rates
Non-resident or resident?
Non-resident: flat 30%
On net rent after allowable expenses. No personal reliefs or rebates. This is most foreign owners, including most MM2H holders who spend under 182 days a year here.
Resident: 0% to 30%
Progressive rates on total income after reliefs (RM9,000 self relief), with a RM400 rebate if chargeable income is RM35,000 or less.
The residence test
182 days or more in Malaysia in the calendar year, or shorter stays linked to 182 consecutive days, or 90 days plus residence or presence in 3 of the 4 previous years.
Resident rates
Resident tax bands, YA 2025 and 2026
| Chargeable income (RM) | Rate | Tax at top of band |
|---|---|---|
| 0 – 5,000 | 0% | RM0 |
| 5,001 – 20,000 | 1% | RM150 |
| 20,001 – 35,000 | 3% | RM600 |
| 35,001 – 50,000 | 6% | RM1,500 |
| 50,001 – 70,000 | 11% | RM3,700 |
| 70,001 – 100,000 | 19% | RM9,400 |
| 100,001 – 400,000 | 25% | RM84,400 |
| 400,001 – 600,000 | 26% | RM136,400 |
| 600,001 – 2,000,000 | 28% | RM528,400 |
| Above 2,000,000 | 30% | — |
Expenses
What you can and cannot deduct
From LHDN Public Ruling 12/2018. All your non-business rental properties are added together; a net rental loss cannot be set against other income or carried forward. Expenses while vacant between tenancies are allowed if the property stays ready to let.
| Deductible | Not deductible |
|---|---|
| Quit rent and assessment | Agent fee, legal fee and stamp duty for the first tenancy |
| Fire insurance | Costs before the property was first let |
| Loan interest on the let property | Loan principal repayments |
| Repairs that keep it in its existing state | Renovation and improvements |
| Agent fee on renewal or a replacement tenant | Personal expenses |
| Rent collection and legal costs to recover rent | Losses set against other income |
Short stays
Airbnb and serviced letting
Letting is a business source only if you yourself provide active maintenance or support services, not just the building management. A business source allows wider deductions and capital allowances, and a resident files Form B instead of BE. Many JB buildings restrict short stays, so check the house rules first.
Filing
Forms, deadlines and penalties
You need a Malaysian tax number (register on MyTax e-Daftar; foreigners use a passport). Late filing costs 15% to 45% of the tax, and late payment adds 10%. Joint owners each declare their own share.
| Who | Form | Deadline for YA 2025 (filed in 2026) |
|---|---|---|
| Non-resident individual | Form M (e-M) | 30 April, or 30 June with business income, plus 15 days for e-filing |
| Resident, no business income | Form BE (e-BE) | 30 April 2026, e-filing to 15 May |
| Resident, letting as a business | Form B (e-B) | 30 June 2026, e-filing to 15 July |
Also good to know
Withholding, e-invoice and treaties
- No withholding tax on rent for a home or building paid to a non-resident individual; the 10% rule covers movable property and services.
- e-Invoice: from 1 September 2026, individuals with annual sales under RM3 million are exempt.
- Tax treaties with India, Indonesia, Singapore and China let Malaysia tax the rent first; your home country normally gives a credit for it.
- Budget 2026 made no change to rental income tax. The main property change was 8% stamp duty for foreign buyers from 1 January 2026.
- See what your unit could earn: rental yield calculator and renting out in Johor.
Straight answers
Frequently asked questions
Do foreigners pay tax on rent from a Malaysian property?
Yes. Rent from property in Malaysia is taxable in Malaysia. Most foreign owners are non-residents for tax and pay a flat 30% on net rent after allowable expenses, with no personal reliefs.
Am I a tax resident?
It depends on days in Malaysia, not citizenship or MM2H: generally 182 days or more in a calendar year, or 90 days plus links to earlier years. Most overseas owners do not qualify.
Does my tenant deduct withholding tax?
Generally no for rent on a home or building: the 10% withholding tax on payments to non-residents covers rent of movable property and services. You declare the rent yourself on Form M.
What can I deduct?
Quit rent, assessment, fire insurance, loan interest on the let property, repairs that keep it in its existing state, rent collection costs and agent fees on renewal or a new tenant. Not the first agent fee, renovation, loan principal or costs before the first letting.
Do I need to issue e-invoices?
From 1 September 2026, individuals with annual sales below RM3 million are exempt from e-invoicing, which covers most individual landlords. Keep your rent records.
Will I be taxed twice?
Malaysia taxes the rent first. Countries with a tax treaty, such as India, Indonesia, Singapore and China, usually give credit for the Malaysian tax against tax at home on the same income.
Ask Jason
Renting out your unit?
Tell me where the unit is and what it rents for. I help you find tenants, set the rent and keep the records your tax agent needs.
More for foreign buyers
Related guides
Last updated 8 October 2026. Sources: LHDN – Tax treatment of residents and non-residents; PwC Tax Summaries – Malaysia personal income tax (Jun 2026); PwC Malaysian Tax Booklet – Personal income tax (Nov 2025); LHDN Public Ruling 12/2018 – Income from letting of real property; LHDN – Return form filing programme 2026; PwC Tax Summaries – Malaysia withholding taxes; Bernama – e-Invoice exemption raised to RM3 million (Aug 2026); LHDN – Malaysia–India tax treaty. General information, not tax advice. Confirm your position with a Malaysian tax agent.
Want help renting out your unit?
I find tenants, check the rent against the building and handle the tenancy paperwork.