Registration Threshold
RM500,000/year
Processing Time
10–14 working days
SST replaced GST in September 2018. Malaysia abolished GST (6% on almost everything) and replaced it with SST — a narrower scope tax. Sales Tax applies to manufacturers of taxable goods; Service Tax applies to businesses providing taxable services. The thresholds and rates are different from GST.
Sales Tax vs Service Tax — Which Applies to You?
| Tax | Who Must Register | Rate | Threshold |
|---|
| Sales Tax | Manufacturers of taxable goods (Schedule A, B, C of Sales Tax Act 2018) | 5% or 10% | RM500,000 taxable turnover in 12 months |
| Service Tax | Businesses providing taxable services (First Schedule of Service Tax Act 2018) | 8% (most services); 6% (credit cards, charge cards) | RM500,000 taxable turnover in 12 months |
Note: Service Tax rate was increased from 6% to 8% effective 1 March 2024 for most taxable services. Credit card/charge card fees remain at 6%.
Common Taxable Services (Service Tax)
- Food & beverage establishments (restaurants, cafés, catering)
- Accommodation (hotels, serviced apartments, Airbnb-type platforms meeting threshold)
- Telecommunications services
- Insurance and takaful
- Professional services: legal, accounting, engineering, architecture, IT
- Security services
- Parking services
- Employment agencies
Common Taxable Goods (Sales Tax)
- Manufactured goods not exempted (cosmetics, toiletries, household goods, machinery)
- Most goods at 10%; petroleum, certain food/beverage inputs at 5%
- Exempted: basic foodstuffs, medical equipment, agricultural inputs, export goods
When Must You Register?
You are required to register within 30 days of the end of the month in which your taxable turnover exceeded RM500,000 in the preceding 12-month period.
| Scenario | Action Required |
|---|
| Taxable turnover exceeded RM500,000 in any 12-month period (historical) | Register within 30 days of month-end when threshold was crossed |
| Projected to exceed RM500,000 in the next 12 months (future) | Register voluntarily — recommended to avoid penalties |
| Turnover below RM500,000 but wants to charge SST | Voluntary registration allowed for sales tax; not permitted for service tax |
| New business — expect to exceed threshold in year 1 | Register proactively — register before you cross the threshold |
Late registration penalties: Failure to register on time can result in penalties of up to RM50,000 or 3 years imprisonment, plus RMCD can back-assess SST from the date your business was liable — meaning you may owe SST on past sales you did not collect from customers.
Documents Required for Registration
- SSM business registration certificate — Sdn Bhd, Enterprise, or LLP
- MyKad of director(s) or owner(s)
- Latest audited accounts or management accounts — to establish turnover history
- Bank statements (3–6 months) — to verify taxable revenue
- Description of your taxable activities — what goods you manufacture or services you provide
- Business address proof — utility bill, tenancy agreement, or land title
- GST deregistration number — if you were previously registered for GST (for reference)
Step-by-Step: Register via MySST
- Determine your tax type and confirm you meet the threshold. Review your past 12 months of taxable turnover. If you've crossed RM500,000 in taxable sales or taxable services, you are legally required to register. If you're close, calculate using rolling 12-month revenue — not just the calendar year.
- Prepare your documents. Gather SSM certificate, MyKad, financial accounts, and bank statements. Prepare a clear description of your business activities and the specific goods or services that are taxable.
- Go to the MySST portal. Visit mysst.customs.gov.my and click Register. You will need to create an account first (or log in if your business was previously registered for GST/SST).
- Complete the registration form. Select the tax type (Sales Tax, Service Tax, or both). Enter your business registration number, tax identification number (TIN from LHDN), turnover details, and a description of taxable activities. Specify the SST code(s) that apply to your goods/services.
- Upload supporting documents. Upload scanned copies of SSM, MyKad, financial accounts, and bank statements.
- Submit and await approval. RMCD reviews your application within 10–14 working days. You may receive a call from a RMCD officer to verify details. Check the portal for status updates.
- Receive your Certificate of Registration. Once approved, you receive a Certificate of Registration and an SST registration number. Your effective registration date is the date you were required to register — not the date RMCD approves your application.
- Start charging SST immediately. From the effective date, issue tax invoices that include your SST registration number and clearly state the SST charged. Update your accounting system, invoicing templates, and POS systems.
After Registration: Ongoing Obligations
| Obligation | Frequency | Deadline |
|---|
| File SST-02 (Service Tax) or SST-01 (Sales Tax) return | Bi-monthly (every 2 months) | Last day of the month following the taxable period |
| Pay SST collected | Bi-monthly | Same as return filing deadline |
| Keep records (invoices, accounts, receipts) | Continuous | Minimum 7 years |
| Issue tax invoices to customers | Per transaction | Within 21 days of transaction |
| Notify RMCD of changes (address, business activities) | As needed | Within 30 days of change |
Taxable periods: SST is reported bi-monthly — Jan/Feb, Mar/Apr, May/Jun, Jul/Aug, Sep/Oct, Nov/Dec. Returns are due by the last day of the month following the end of each 2-month period. Example: Jan–Feb return is due by 31 March.
SST Rates Quick Reference
| Tax | Rate | Notes |
|---|
| Service Tax (most services) | 8% | Effective 1 March 2024 |
| Service Tax (credit/charge card annual fee) | 6% | Unchanged |
| Sales Tax (most taxable goods) | 10% | Standard rate |
| Sales Tax (selected goods: petroleum, certain items) | 5% | Specified in Schedule A |
| Sales Tax (low-value goods from overseas, digital services) | 10% | Applies to imported digital services via reverse charge mechanism |
Pro Tips — What Businesses Commonly Get Wrong
- Don't count non-taxable revenue towards the threshold. The RM500,000 threshold applies only to taxable turnover — not your total revenue. If you sell exempt goods alongside taxable goods, only the taxable portion counts. Get this wrong and you may register too early (and collect SST unnecessarily) or too late.
- Issue proper tax invoices from Day 1. A tax invoice must include: your SST registration number, the word "Tax Invoice", invoice date, SST rate and amount charged, and your business name and address. Non-compliant invoices can create issues for your B2B clients who need to account for SST.
- SST is collected from customers, not paid by you. You are a collecting agent — SST is added on top of your price and collected from customers. You remit it to RMCD bi-monthly. You should never absorb SST as a cost unless you've explicitly priced it in.
- Service Tax has no input tax credit mechanism. Unlike GST, Service Tax in Malaysia has no mechanism to claim back SST paid on your business inputs. It is a single-stage tax charged only at the service provider level.
- Digital services from overseas are subject to Service Tax. Since 2020, overseas digital service providers (Netflix, Spotify, Zoom, AWS, etc.) charge 6–8% Service Tax on Malaysian customers. If your business buys such services for business use, you account for this via reverse charge.
- Deregister when you no longer meet the threshold. If your taxable turnover drops below RM500,000 for 24 consecutive months, you may apply to deregister. Remaining registered when you don't need to be means unnecessary compliance work.
Frequently Asked Questions
Do freelancers and sole proprietors need to register for SST?
Yes — if you provide taxable services and your turnover from those services exceeds RM500,000 in any 12-month period, you must register regardless of your business structure. A sole proprietor or freelancer providing IT consulting, legal, or accounting services who exceeds the threshold must register for Service Tax.
Is a restaurant required to charge SST?
Only if its turnover from food and beverage services exceeds RM500,000 per year. Below that threshold, no SST is required. Food and beverage is in the First Schedule of the Service Tax Act 2018. Note: sales tax also applies to certain packaged food goods sold by manufacturers.
What is the difference between SST and e-Invoice?
They are separate obligations. SST is a tax on taxable goods and services. e-Invoice (myInvois) is a digital invoicing format mandated by LHDN for income tax reporting. SST-registered businesses must comply with both once their turnover exceeds the respective thresholds. e-Invoice for businesses with >RM100M turnover started August 2024; it is being phased in for smaller businesses through 2025–2026.
Can I voluntarily register for SST before hitting the threshold?
For Sales Tax: yes, manufacturers of taxable goods can apply for voluntary registration. For Service Tax: voluntary registration is generally not permitted — you register when required by law. Contact RMCD directly if your situation is unusual.
What happens if I fail to register when required?
RMCD can back-assess SST from the date you were liable to register. You will owe the SST on all past taxable sales — money you may have already spent and cannot recover from customers. Penalties range from RM10,000 to RM50,000 or 3 to 5 years imprisonment. RMCD conducts audits and can access your bank statements and accounting records.
Does SST apply to exported goods and services?
Exports are zero-rated (exempt) for Sales Tax — goods exported outside Malaysia are not subject to Sales Tax. Services that are consumed entirely outside Malaysia are generally not subject to Service Tax. Businesses that export can apply for a sales tax exemption (manufacturer under Schedule B or C) to avoid paying sales tax on inputs used in exported goods.
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⚠ Disclaimer: This guide is for informational purposes only and is not legal or tax advice. SST legislation, rates, and thresholds are subject to amendment by the Malaysian government. Always consult a licensed tax agent or accountant and verify current rules at customs.gov.my or mysst.customs.gov.my before registering. Last reviewed: March 2026.