Malaysia Corporate Income Tax
Detailed corporate income tax rates and rules for Malaysia in 2026.
Malaysia's standard corporate income tax rate is 24%. Small and medium enterprises (SMEs) with paid-up capital of RM 2.5 million or less (and not part of a group with a member exceeding this threshold) benefit from a 15% rate on the first RM 150,000 of chargeable income, 17% on RM 150,001-600,000, and 24% on the remainder. Various incentives are available through MIDA, including Pioneer Status (5-10 year tax exemption), Investment Tax Allowance, and sector-specific incentives.
Standard Rate
24%
Small Business Rate
15%
Additional Notes
Malaysia has a territorial tax system for companies, but foreign-sourced income received in Malaysia has been taxable from 2022, with transitional exemptions for certain categories. The Labuan International Business and Financial Centre (Labuan IBFC) offers a 3% tax rate on net profits or a flat RM 20,000 for trading entities conducting substantial activities. Malaysia is implementing the Global Minimum Tax from 2025.
How Malaysia Corporate Tax compares
Malaysia’s corporate tax rate of 24% is the 108th highest of 203 countries TaxAtlas tracks, above the global average of 22.2% and Asia’s regional average of 19.7%.
