YA2025 Personal Tax Reliefs

By: Winnie Foo & Bryan Khau

2% Dividend Tax for Individual Shareholders

Effective 1 January 2025, Malaysia will introduce a 2% dividend tax on individual shareholders whose Malaysian-sourced dividend income exceeds RM100,000 annually. The tax applies only to the portion above the RM100,000 threshold and covers both resident and non-resident individuals. Corporate shareholders are not subject to this tax.

Dividends from specific sources may be exempt, including foreign-sourced dividends, pioneer status companies, cooperatives, selected approved funds and EPF savings.

As the tax is self-assessed, affected taxpayers must declare and remit the amount when filing their personal income tax returns. In the event of a tax audit, individuals should retain the following supporting documents:

• Dividend certificates or vouchers from dividend-paying companies
• Records of dividend income from multiple sources
• Tax returns and documentation for self-declaration