Withholding tax is a method of collecting taxes from non-residents who have derived income which is subject to Malaysian tax. Any tax resident person who is liable to make certain specified types of payments to a non-resident is required to deduct withholding tax at a prescribed rate applicable to the gross payment and remit it to the Malaysian Inland Revenue Board within one month of paying or crediting.
Payments subject to Withholding Tax |
Rates (%)* |
Interest |
15 |
Royalties |
10 |
Dividends |
Nil |
Contract payments (services rendered in Malaysia)
|
10 3 |
Special classes of income
|
10 |
Other gains or profits |
10 |
* A reduced rate may be provided under the double tax agreement with certain treaty partners
The following countries have concluded double tax treaties with Malaysia:
Treaty countries |
Rate of withholding tax % |
||
Interest |
Royalties |
Technical Fees |
|
Albania |
10 or Nil |
10 |
10 |
Australia |
15 or Nil |
10 |
Nil |
Austria |
15 or Nil |
10 |
10 |
Bahrain |
5 or Nil |
8 |
10 |
Bangladesh |
15 or Nil |
10 or Nil |
10 |
Belgium |
10 or 15 or Nil |
10 |
10 |
Bosnia & Herzegovina |
10 or Nil |
8 |
10 |
Brunei |
10 or Nil |
10 |
10 |
| Cambodia1 | 10 or Nil | 10 | 10 |
Canada |
15 or Nil |
10 or Nil |
10 |
Chile |
15 |
10 |
5 |
China, People’s Republic |
10 or Nil |
10 |
10 |
Croatia |
10 or Nil |
10 |
10 |
Czech Republic |
12 or Nil |
10 |
10 |
Denmark |
15 |
10 |
10 |
Egypt |
15 or Nil |
10 |
10 |
Fiji |
15 or Nil |
10 |
10 |
Finland |
15 or Nil |
10 or Nil |
10 |
France |
15 or Nil |
10 or Nil |
10 |
Germany |
10 or Nil |
7 |
7 |
Hong Kong |
10 or Nil |
8 |
5 |
Hungary |
15 or Nil |
10 |
10 |
India |
10 or Nil |
10 |
10 |
Indonesia |
10 or Nil |
10 |
10 |
Iran |
15 or Nil |
10 |
10 |
Ireland |
10 or Nil |
8 |
10 |
Italy |
15 or Nil |
10 or Nil |
10 |
Japan |
10 or Nil |
10 |
10 |
Jordan |
15 or Nil |
10 |
10 |
Kazakhstan |
10 or Nil |
10 |
10 |
Korea Republic |
15 or Nil |
10 or Nil |
10 |
Kuwait |
10 or Nil |
10 |
10 |
Kyrgyz Republic |
10 or Nil |
10 |
10 |
Laos |
10 or Nil |
10 |
10 |
Lebanese Republic |
10 or Nil |
8 |
10 |
Luxembourg |
10 or Nil |
8 |
8 |
| Maldives1 | 10 or Nil | 10 | 10 |
Malta |
15 or Nil |
10 |
10 |
Mauritius |
15 or Nil |
10 |
10 |
Mongolia |
10 or Nil |
10 |
10 |
Morocco |
10 or Nil |
10 |
10 |
Myanmar |
10 or Nil |
10 |
10 |
Namibia |
10 or Nil |
5 |
5 |
Netherlands |
10 or Nil |
8 or Nil |
8 |
New Zealand |
15 or Nil |
10 or Nil |
10 |
Norway |
15 or Nil |
10 or Nil |
10 |
Pakistan |
15 or Nil |
10 or Nil |
10 |
Papua New Guinea |
15 or Nil |
10 |
10 |
Philippines |
15 or Nil |
10 or Nil |
10 |
Poland |
10 or Nil |
8 |
8 |
Qatar |
5 or Nil |
8 |
8 |
Romania |
15 or Nil |
10 or Nil |
10 |
Russian Federation |
15 or Nil |
10 or Nil |
10 |
| Russian Federation (new)1 | 10 or Nil | 10 |
10 |
San Marino |
10 or Nil |
10 |
10 |
Saudi Arabia2 |
5 or Nil |
8 |
8 |
Senegal1 |
10 or Nil |
10 |
10 |
Seychelles Republic |
10 or Nil |
10 |
10 |
Singapore |
10 or Nil |
8 |
5 |
Slovak Republic |
10 or Nil |
10 |
5 |
South Africa |
10 or Nil |
5 |
5 |
Spain |
10 or Nil |
7 |
5 |
Sri Lanka |
10 or Nil |
10 |
10 |
Sudan |
10 or Nil |
10 |
10 |
Sweden |
10 or Nil |
8 |
8 |
Switzerland |
10 or Nil |
10 or Nil |
10 |
Syria |
10 or Nil |
10 |
10 |
Thailand |
15 or Nil |
10 or Nil |
10 |
Turkey |
15 or Nil |
10 |
10 |
Turkmenistan |
10 or Nil |
10 |
Nil |
| Ukraine | 10 or Nil |
8 |
8 |
United Arab Emirates |
5 or Nil |
10 |
10 |
United Kingdom |
10 or Nil |
8 |
8 |
Uzbekistan |
10 or Nil |
10 |
10 |
Venezuela |
15 or Nil |
10 |
10 |
Vietnam |
10 or Nil |
10 |
10 |
Zimbabwe |
10 or Nil |
10 |
10 |
1Status pending
2Malaysia also has a limited double tax treaty covering air transport operations with Saudi Arabia
Notes:
- Argentina and the United States of America – Limited double tax treaty covering air and sea transport operations in international traffic.
- There is no withholding tax on dividends paid by Malaysian companies
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