Malaysia
Calculate your 2025 income tax with Form B progressive rates — and see how tax reliefs cut what you owe.
Total Tax
Take Home
Monthly Tax
Monthly Take Home
How Your Tax Is Calculated
Deductions Applied
How Your Malaysia Freelance Tax Is Calculated
The Malaysia calculator uses Form B progressive rates and applies all available personal reliefs to find your true chargeable income:
Step 1: Calculate Chargeable Income
Chargeable Income = Gross Annual Income − Personal Reliefs − Business Expenses
The calculator automatically applies key reliefs: individual relief (RM 9,000), lifestyle relief (up to RM 2,500 for tech & internet), EPF relief (up to RM 4,000), and insurance relief (up to RM 3,000). You can adjust these in the form to match your situation.
Step 2: Apply Progressive Tax Rates
Tax is calculated on your chargeable income using Malaysia's progressive brackets: 0% up to RM 5,000, 1% on RM 5,001–20,000, 3% on RM 20,001–35,000, 8% on RM 35,001–50,000, then 14%, 21%, 24%, 25%, up to 30% above RM 2,000,000.
The effective tax rate shown is your total tax divided by your gross income — giving you a single percentage to compare across countries. Most freelancers with chargeable income under RM 50,000 pay less than 3% effective rate.
Learn More
Official Sources
- • LHDN — Income Tax Act 1967, Form B filing guidelines
- • LHDN — Annual relief schedules and rebate amounts
- hasil.gov.my
Malaysia Freelancer Tax Guide
What tax form do freelancers file in Malaysia?
Freelancers and self-employed individuals use Form B (Borang B) through LHDN (Lembaga Hasil Dalam Negeri). This differs from Form BE, which is for employees with no business income. Form B lets you deduct business expenses and claim personal tax reliefs, which can significantly reduce your taxable income.
What tax reliefs can I claim as a freelancer?
Malaysia offers generous reliefs: Individual relief (RM 9,000), Lifestyle (up to RM 2,500 for IT equipment, internet, subscriptions — highly relevant for freelancers), EPF (up to RM 4,000), Insurance & medical (up to RM 3,000), and Education (up to RM 7,000 for courses and certifications). These stack on top of each other and directly reduce your taxable income.
What are the income tax rates?
Malaysia uses progressive rates from 0% to 30%. The first RM 34,000 of chargeable income is taxed at 0%–1%. After that: 5% on RM 34,001–50,000, 10% on RM 50,001–70,000, and so on up to 30% for income over RM 2 million. After reliefs, many freelancers land in the lowest brackets or pay zero tax.
When is the tax filing deadline?
For Form B, the deadline is June 30 (manual filing) or July 15 (e-Filing). CP500 installment payments are made monthly if your annual tax exceeds a certain threshold. Late filing carries penalties.
Do I need to register a business?
Yes, you should register with SSM (Suruhanjaya Syarikat Malaysia) as a sole proprietor. This is separate from your LHDN tax registration. You'll need this to open a business bank account, issue invoices, and claim business expenses legitimately.
What business expenses can I deduct?
Common deductible expenses for Malaysian freelancers include: office equipment and supplies, internet and phone bills, coworking space costs, professional development (courses, certifications), marketing and website costs, and travel for client meetings. Keep all receipts for at least 7 years as LHDN can audit your returns.
Do I need to pay CP500 installments?
If your estimated tax payable exceeds a certain threshold (typically RM 2,000), LHDN requires you to pay CP500 monthly installments. These are paid in 12 installments starting February each year. If you overpay, the excess is refunded after filing your annual return. If you underpay, a 10% penalty may apply.
Fahmi
Freelance Software Engineer & Tax Researcher
Researching and maintaining freelance tax guides for 6 Asian countries based on official government regulations.