Malaysia SST, e-Invoice & Payroll Compliance Guide

Malaysia's SST replaced GST in September 2018. It is a single-stage tax: Sales Tax (10%) on manufactured/imported goods and Service Tax (8%) on prescribed services.

• Sales Tax: register if annual turnover > RM500,000
• Service Tax: register if annual turnover > RM500,000
• Bi-monthly SST returns (SST-01 for sales, SST-02 for services)
• Due 30 days after end of taxable period
• SST exemptions for exported goods, raw materials in FTZ
• MySST portal for registration, filing, and payment
• Group relief available for related companies

Malaysia's mandatory e-Invoicing system (MyInvois) is being phased in. The Inland Revenue Board (LHDN) requires businesses to issue validated e-Invoices through the MyInvois platform.

• Phase 1 (Aug 2024): Annual turnover > RM100M — LIVE
• Phase 2 (Jan 2025): Annual turnover > RM25M — LIVE
• Phase 3 (Jul 2025): All remaining businesses
• Real-time validation by LHDN before invoice issuance
• Unique IRBM Unique Identifier Number (UUIN) per invoice
• Supports API integration and MyInvois portal
• e-Invoice required for B2B, B2C, and B2G transactions
• Credit notes and debit notes must also be e-Invoiced

Potongan Cukai Bulanan (PCB) or Monthly Tax Deduction (MTD) is the employer's obligation to deduct income tax from employees' monthly remuneration and remit to LHDN.

• Employers deduct tax based on PCB schedule or computerised calculation
• Remit to LHDN by 15th of following month
• CP39 form for PCB remittance
• EA form (annual remuneration statement) by 28 February
• e-PCB system for electronic submission
• Non-resident employees: flat 30% withholding
• Tax relief and deductions reflected in PCB calculation

KWSP/EPF is Malaysia's mandatory retirement savings scheme. Both employers and employees make monthly contributions based on wages.

• Employer contribution: 12% (wages > RM5,000) or 13% (wages ≤ RM5,000)
• Employee contribution: 11% of monthly wages
• Contribution due by 15th of following month
• i-Akaun for employee account management
• i-Saraan: voluntary contribution for self-employed
• Penalties for late payment: 10% dividend on arrears
• Foreign workers: employer RM5/month, employee 11%

PERKESO/SOCSO provides social security protection for employees against occupational injuries, diseases, invalidity, and death. EIS covers loss of employment.

• Employment Injury Scheme: employer only (1.25% of wages)
• Invalidity Scheme: employer 0.5% + employee 0.5%
• EIS (Employment Insurance): employer 0.2% + employee 0.2%
• Mandatory for employees earning ≤ RM5,000/month (first-time contributors)
• Self-Employment Social Security Scheme (SESSS) available
• Contribution due by 15th of following month
• ASSIST portal for online submissions

The Human Resources Development Fund levy is mandatory for employers in specified sectors with 10+ employees. The levy funds employee training and development programmes.

• Levy: 1% of monthly payroll (10+ employees)
• Levy: 0.5% optional (5–9 employees in specified sectors)
• Over 60 sectors covered (manufacturing, services, IT, etc.)
• Claim training grants from HRD Corp
• Register via HRD Corp portal
• Contribution due by 15th of following month
• Schemes: SBL, SBL-Khas, PROLUS, PLT, etc.