Expense rules in Malaysia.
All LHDN rules: 10% SST, mission allowances and VAT recovery rules in Malaysia.
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1Expense rules & reclaimable VAT
| Category | VAT | Reclaim | Cap / Note |
|---|---|---|---|
| Business meals | 8% | 100% deductible | If business legitimate |
| Travel meals | 8% | 100% reclaimable | Per diem cap |
| Accommodation | 8% | 100% reclaimable | Receipt required |
| Fuel | Variable | 100% reclaimable | Business records |
| Train / KTM / flight | Variable | 100% reclaimable | Public transport |
| Taxi / Grab | 8% | 100% reclaimable | Receipt required |
| Client gifts | 10% | Limited | LHDN reasonable cap |
| Parking | 8% | 100% reclaimable | Receipt |
No VAT
SST on sales + Service Tax on services.
Per diem
MNC standard.
Retention
LHDN records: 7 years.
2Mileage allowance
| Mode | Allowance | Cap | Note |
|---|---|---|---|
| Personal car | MYR 1,00/km | By company | Standard practice |
| Motorcycle | MYR 0,50/km | By company | Reduced rate |
MNC practice
Private sector standard.
Records
Date, destination, km.
Covers
Mainly fuel.
3Per diem and travel allowances
| Destination | Meal | Lodging / night | Daily rate |
|---|---|---|---|
| KL / Selangor | MYR 120 | MYR 400 | MYR 520 |
| Penang / Johor | MYR 100 | MYR 320 | MYR 420 |
| Senior executive | MYR 250 | MYR 800 | MYR 1,050 |
| Foreign — Singapore | MYR 300 | MYR 900 | MYR 1,200 |
| Foreign — Bangkok | MYR 200 | MYR 600 | MYR 800 |
MNC practice
Standard executive per diem.
Hotel separate
Lodging refunded on invoice.
No statutory rate
No mandatory LHDN cap.
4Foreign VAT recovery
| Zone | Mechanism | Deadline | Method |
|---|---|---|---|
| Malaysia → EU | 13th Directive if eligible | Variable | Direct filing per EU country |
| France | No reciprocity | — | No agreement |
| United Kingdom | No reciprocity | — | No agreement |
| Switzerland | Reciprocity | 30 June N+1 | FTA Form 1222 |
| USA | No recovery | — | Sales tax not recoverable |
| MY SST for foreign | None | — | No mechanism |
No B2B refund
SST/Service Tax not B2B recoverable.
Free zones
LMW (Licensed Manufacturing Warehouse) exempt.
Outbound
MY company can recover EU VAT.
Industrialize your Malaysia expenses with Illizeo.
SST 10%, Service Tax 8%, MNC per diem, multi-currency MYR↔SGD↔USD↔EUR↔CHF: all the LHDN rules above are natively integrated into Illizeo.
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