Rental income and service tax
My company earns RM1.2 million rent from commercial units. Do I need to register for service tax?
The situation
From 1 July 2025, rental or leasing services are taxable with a registration threshold of RM1 million in 12 months.
The law
- Service tax scope expansion from 1 July 2025 (rental, construction, financial, healthcare, education): New taxable services with own thresholds: rental RM1 million, construction RM1.5 million, education nil
- Sec 12, Service Tax Act 2018: Persons providing taxable services above the prescribed threshold must register
What it means for you
At RM1.2 million you exceed the threshold. The rate was 8% to 31 December 2025 and 6% from 1 January 2026. Intra-group rental may be relieved if the group conditions are met. Residential rental is generally outside scope; check exclusions.
What to do
- Total 12-month rental receipts by type.
- Check group relief.
- Register on MySST.
- Charge 6% and file SST-02.
We can do this for youService tax registration and SST-02 returns: MYR 800