Dividend tax in Malaysia

Updated on Monday 13th February 2017

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People who choose to do business in Malaysia can benefit from the interesting opportunities on the market and from the incentives and advantages that come with the taxation system in the country. For instance, it is good to know that the dividends of companies in Malaysia are not taxed, which is why shareholders can enjoy the 100% share profit. Our Malaysian lawyers are able to offer suitable information about the taxes in the country and also about the available legal services for your company or for personal matters.

Dividends in Malaysia

From the beginning, foreign and local entrepreneurs with activities in Malaysia are exempt from the withholding tax on dividends, which is why many shareholders choose to invest such profits in the stock exchange and to gain more money. The dividends can be considered as a reward for the company’s shareholders for holding stocks in the corporation. The dividends in Malaysia can be distributed once, twice per year or quarterly, according to the rules of the company and considering the financial status.

The brand-new registered enterprises in Malaysia can postpone the dividend payment to the shareholder for the first two years, retaining the profits to a further development of the company. We remind that you can receive complete information from our lawyers in Malaysia about the company taxes you need to pay.

Important taxes in Malaysia

In Malaysia, the companies are levied on incomes and the tax rate is settled at 25%. As for the technical fees, royalties and other earnings, we remind that the tax rate is 10%. There are many tax exemptions in Malaysia, which is why the country is quite attractive from this point of view to foreign investors, and here we remind the following:

•    the incomes paid from outside Malaysia;
•    the interests;
•    the incomes resulting from research findings;
•    the traveling allowances;
•    the pensions.

Additional information about the taxation system in Malaysia and about the legal services available for your company can be found if you contact our Malaysian law firm.


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