1. What is Rental Income Tax in Malaysia?

Rental income tax in Malaysia is calculated on the net rental income after deducting allowable expenses. The tax rate can go up to 30% depending on your total taxable income and tax bracket as per LHDN (Inland Revenue Board of Malaysia) rules.

2. How Does the Calculator Work?

The calculator uses the following formulas:

Where:

• Gross Rental Income — Total rental income received (MYR)
• Allowable Expenses — Deductible expenses as per LHDN rules (MYR)
• Tax Rate — Applicable tax rate (percentage)

Explanation: The calculator first determines the taxable income by subtracting allowable expenses from gross rental income, then applies the tax rate to calculate the tax payable.

3. Importance of Rental Income Tax Calculation

Details: Accurate rental income tax calculation is crucial for compliance with Malaysian tax laws, avoiding penalties, and proper financial planning for property investments.

4. Using the Calculator

Tips: Enter gross rental income in MYR, allowable expenses in MYR, and the applicable tax rate (up to 30%). All values must be valid positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What expenses are allowable for rental income tax deduction?
A: Common allowable expenses include property maintenance, assessment taxes, quit rent, insurance premiums, and loan interest (up to certain limits).

Q2: Is there a minimum rental income threshold for taxation?
A: All rental income is taxable, but the amount of tax depends on your total taxable income and applicable tax bracket.

Q3: How often should I declare rental income?
A: Rental income should be declared annually in your tax return (Form B or Form BE) to LHDN.

Q4: Can I claim capital expenses as deductions?
A: No, capital expenses like property purchase price or major renovations are not deductible as current year expenses.

Q5: What if I have multiple rental properties?
A: The gross rental income and allowable expenses from all properties should be aggregated for tax calculation.