Tax Treatment of Foreign Income Received in Malaysia

[Marzio]

Good article on tax treatment of foreign income received in Malaysia: Technical Guideline on the Tax Treatment of Foreign Income Received in Malaysia ”” Orbitax Tax News & Alerts

There's a temporary exemption for certain foreign-source income till 31 December 2026 provided that the income has been subject to tax in the country of origin.

Looks like FSI which isn't brought into the country will continue to be tax exempt.

Last edited: Oct 17, 2022

 

[backpacker]

marzio said:
Good article on tax treatment of foreign income received in Malaysia: Technical Guideline on the Tax Treatment of Foreign Income Received in Malaysia ”” Orbitax Tax News & Alerts

There's a temporary exemption for certain foreign-source income till 31 December 2026 provided that the income has been subject to tax in the country of origin.

Looks like FSI which isn't brought into the country will continue to be tax exempt.
Click to expand...

As expected -> New Malaysian nomad visa :
Looks like bad news for DE Rantau - MDEC holders.

 

[Marzio]

backpacker said:
Looks like bad news for DE Rantau - MDEC holders.
Click to expand...

For MM2H living there full time too.

Those instead who use MM2H as a paper tax residency will not be impacted.

 

[JonnyStekkino]

I were about to register for the DE Rantu program, I'm currently based in Dubai both me and my company.
That means that I will be taxed for just living in Malaysia with the de rantu?

 

[backpacker]

JonnyStekkino said:
I were about to register for the DE Rantu program, I'm currently based in Dubai both me and my company.
That means that I will be taxed for just living in Malaysia with the de rantu?
Click to expand...

What is known has been explained in this thread (there are links to click!).
If you still want to elaborate your personal situation:

1. Study the Double Taxation Avoidance Agreement between Malaysia and the United Arab Emirates.
2. Check your sources of income (passive, active, entrepreneurial, income from investments ....).
3. Get an understanding for the term Permanent Establishment (PE).
4. If you, after having understood all the above, still want to apply for DE Rantau (why would you want to do that?), consult a local tax advisor for more details.

If you are interested in SE-Asia, the Philippines offers clearer rules and an easier tax system.

Last edited: Oct 22, 2022