When your Sdn Bhd rents a house, the tax implications depend on whether the rental expense is for business purposes. Here’s what you need to know:

1. Corporate Tax Treatment

• If the rented house is used exclusively for business purposes (e.g., staff accommodation, office, or storage), the rent is tax-deductible under the Income Tax Act 1967.

• If the rent is for personal use (e.g., director’s private residence), it is not tax-deductible and could be considered a benefit-in-kind (BIK), taxable to the employee or director.

2. Withholding Tax (If Landlord is Non-Resident)

• If your company pays rent to a non-resident landlord, you must deduct 10% withholding tax under Section 4(d) of the Income Tax Act 1967 and remit it to LHDN by the 10th of the following month.

3. Real Property Gains Tax (RPGT) – Not Applicable

• Your company doesn’t pay RPGT unless it sells a property. Renting does not trigger RPGT.

4. Service Tax (SST) on Rent

• Residential property rent is exempt from SST.
• Commercial property rent is subject to 8% SST, but only if the landlord is a registered SST taxpayer (exceeding RM500,000 in taxable services).

When to Pay Tax on Rental Expense?

• Corporate tax is paid annually based on your financial year-end when filing the Form C (Income Tax Return) for Sdn Bhd.

• If withholding tax applies, it must be paid by the 10th of the following month after rent payment.


Sdn Bhd

Sdn Bhd
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1 Corporate Tax Treatment

• 1967tax-deductible
• Benefit-in-KindBIK
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2 Withholding Tax

• 19674(d)10%10LHDN
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3 RPGT—

•
• RPGT
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4 SST

• SST
•  SST RM500,0008%
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• Corporate Tax
Form C
• Withholding Tax
10 LHDN