16th March 2026 - 10 min read
Whether you pay tax on your investment returns in Malaysia depends almost entirely on what you’re invested in. Bursa shares, fixed deposits, unit trusts, EPF, and ASB are either tax-free or taxed at source before distributions reach you. Overseas stocks, REITs, and crypto have their own rules, and those are worth understanding before you invest.
Capital gains tax applies to the profit you make when you sell an investment. Returns or dividends cover the income your investment pays out along the way, such as interest, dividends, or distributions. Here’s how each investment type is treated.
| Investment Type | Capital Taxed? | Returns Taxed? |
| Bursa-listed shares | No | No (unless dividends exceed RM100,000/yr) |
| Fixed deposits and savings accounts | No | No |
| Unit trusts (local and foreign-focused) | No (until 2028, on specified disposals) | Generally no additional tax for individuals |
| ASB / ASNB funds | No | Generally tax-exempt for individuals |
| EPF | No | No |
| REITs listed on Bursa | No | 10% withheld on distributions |
| Gold (physical and gold savings accounts) | No | No |
| Unlisted company shares | Individuals generally not in scope for CGT | No (unless dividends exceed RM100,000/yr) |
| Cryptocurrency | No | Possibly, if treated as trading income |
| Overseas stocks (e.g. US shares) | No (in Malaysia) | 30% withheld by US (no comprehensive dividend treaty); if brought into Malaysia exempted until 2036 |
For unit trust investors, distributions are generally paid out after tax has already been handled at the fund level, so you won’t be taxed again on what you receive. If the fund holds overseas assets, foreign withholding tax may already have been deducted before distributions reach you.
From 2025, if your total annual dividend income from Malaysian resident companies exceeds RM100,000, a 2% tax applies to the amount above that threshold. The tax is not calculated on your entire dividend income, only on the portion that exceeds RM100,000.
So if you receive RM120,000 in dividends in a year, the 2% applies to RM20,000, giving you a tax bill of RM400. If you receive RM95,000, dividend tax is not applicable.
This applies to dividends from Malaysian resident companies only. EPF dividends, ASNB distributions, and unit trust distributions are not affected.
If you buy and sell shares on Bursa Malaysia, any profit you make from the price difference is not subject to capital gains tax (CGT). Malaysia’s CGT regime introduced from 2024 focuses on disposals of unlisted shares by specified entities; listed shares are not in scope, and this remains the case as of 2026.
Dividends from Malaysian companies operate under a single-tier tax system, which means the company pays tax on its profits before distributing dividends. By the time the dividend reaches you, tax has already been paid at the corporate level, so you don’t pay tax on it again.
If your total dividend income from Malaysian resident companies exceeds RM100,000 in a year, the 2% dividend tax applies to the excess, see the section above for how this is calculated.
Interest earned from money deposited in licensed Malaysian banks is generally tax-exempt for individual residents. This covers fixed deposits, savings accounts, and most money market instruments at regulated institutions.
Interest from ringgit-denominated Malaysian government bonds and corporate sukuk is also exempt for resident individuals, which is one reason bonds and sukuk remain popular within unit trust portfolios and for investors who hold them directly.
Unit trust distributions are typically paid net of any tax handled at the fund level, and unit holders may receive tax credits where applicable. For most individual retail investors, this means no additional tax is payable on top of what the fund has already accounted for.
ASB, ASM, and other ASNB funds are generally treated as tax-exempt for individual investors. The distributions and bonuses credited to your account each year are not subject to further income tax. EPF dividends follow the same logic. They are fully exempt and do not need to be declared in your tax filing, whether your money sits in your main EPF account or has been channelled into unit trusts through the EPF Members Investment Scheme.
Returns from robo-advisory platforms like StashAway, Wahed, and Raiz do not attract additional Malaysian income tax. These platforms invest through unit trust funds, which handle tax at the fund level before distributions reach you. If the fund invests overseas, some foreign tax may already have been deducted before the returns reach you, this is handled within the fund and is not something you declare or pay separately.
Unit trusts are currently exempt from capital gains tax on certain share sales within the fund, and this exemption runs until the end of 2028. After that, the government has not yet confirmed whether it will be extended. If it isn’t, the tax would be applied at the fund level, which could reduce the returns that flow through to you.
Listed REITs (Real Estate Investment Trusts) on Bursa Malaysia are treated slightly differently from regular shares. The distributions you receive from a REIT, which function similarly to rental income passed through to investors, are subject to a 10% withholding tax for individual Malaysian residents. This is deducted before the distribution reaches you, so the amount credited to your account is already net of tax.
If you sell your REIT units at a profit, that gain is not taxed. This is the same as selling any other share listed on Bursa Malaysia, where you keep the full profit.
For most gold investments, no. Whether you hold physical gold, a gold savings account, or gold ETFs on Bursa, you don’t pay capital gains tax when you sell at a profit. The exception is if LHDN decides your gold activity looks more like a business than personal investing. If you are buying and selling gold frequently, your profits could be treated as trading income and taxed accordingly. If you hold gold occasionally as part of a broader portfolio, this is unlikely to apply to you.
Crypto is treated differently from traditional investments under Malaysia’s income tax framework. There is no dedicated CGT on digital assets for individuals, but LHDN takes the position that if your crypto activity looks like a business, frequent trading with the intention of profit, the gains can be classified as trading income and taxed accordingly.
If you are a long-term holder who occasionally converts crypto to cash, the tax risk is lower. If you are actively trading day-to-day, the LHDN may treat your gains as taxable income.
In June 2024, the LHDN ran a joint operation with the police and CyberSecurity Malaysia called Ops Token, raiding 10 locations across the Klang Valley and seizing trading data from phones and computers. The operation was a direct response to the scale of unreported crypto activity, with the LHDN estimating the total value of crypto transactions in Malaysia that year at RM1.441 trillion. This is not a theoretical concern. For detailed guidance, our crypto tax article covers the LHDN’s position in more depth.
Selling shares in a US or global company does not trigger any Malaysian CGT for individual residents. Malaysia’s CGT regime currently applies to companies and corporate bodies selling shares in private companies, not to individuals buying and selling shares on overseas stock markets.
When a US-listed company pays you a dividend, the IRS (the US tax authority) automatically withholds 30% before the money reaches you. So if a company announces a USD 1.00 dividend, you only receive USD 0.70.
Malaysia does not have a comprehensive tax treaty with the US that would reduce this rate for retail investors, so the full 30% applies. The amount you do receive in Malaysia is exempt from Malaysian income tax until 31 December 2036, provided the income has been subject to tax in the country of origin (which it is, given the 30% US withholding), you are a Malaysian tax resident, and the income is not related to a partnership business in Malaysia.
Even though the income is exempt, you are still required to declare it in your tax return and retain supporting documentation such as dividend vouchers or broker statements.
One thing many Malaysian investors in US stocks miss is US estate tax. If the total value of your US shares and other US-based assets exceeds USD 60,000 at the time of death, your estate could be subject to US estate tax at rates of up to 40%.
Do I need to declare my investment returns in my LHDN tax filing?
If your total dividend income from Malaysian resident companies exceeds RM100,000 per year (from 2025 onwards), the excess is subject to a 2% tax and should be reported. Fixed deposit interest, EPF dividends, and unit trust distributions for individuals do not need to be declared.
Does the new capital gains tax affect me if I sell shares on Bursa Malaysia?
No. The CGT introduced in 2024 applies to specified disposals of unlisted company shares by certain entities, primarily companies and corporate bodies. Individual investors selling shares on Bursa Malaysia are not affected.
What if I sell shares in a private company I co-founded or invested in?
CGT may apply depending on the structure of the disposal and the entity involved. You should seek advice from a licensed tax advisor before completing any such transaction.
Is the dividend from ASB or ASNB taxable?
ASB, ASM, and other ASNB fund distributions are generally treated as tax-exempt for individual investors. There is no additional income tax levied on the distributions or bonuses credited to your account.
Are my US stock dividends taxed twice?
In a sense, yes. The US withholds 30% before the dividend reaches you, and because Malaysia does not have a comprehensive dividend treaty with the US, that rate is not reduced for retail investors. The amount you do receive in Malaysia is currently exempt from Malaysian income tax until 2036, so there is no second layer of Malaysian tax on top currently.
What happens to my unit trust investments after 2028 when the CGT exemption ends?
The exemption currently covers CGT on specified disposals of unlisted shares by qualifying unit trusts. The government has not yet announced whether it will be extended beyond 2028. If it is not, CGT could apply at the fund level on those disposals, which may reduce net returns.
Are returns from robo-advisors like StashAway or Wahed taxable?
You do not need to pay additional Malaysian income tax on returns from robo-advisory platforms. StashAway and Wahed invest through unit trust structures, which handle tax at the fund level before distributions reach you. If the fund invests overseas, some foreign tax may already have been deducted before the returns reach you, but this is handled within the fund and is not something you declare or pay separately.
This article is for general informational purposes and does not constitute tax advice. If you have a complex investment portfolio or are unsure how these rules apply to your situation, consider speaking with a licensed tax advisor or financial planner.
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If you want a full breakdown of every tax relief available this year, our comprehensive YA 2025 income tax guide has you covered.
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Pugaleshwaran Raja Kumaran is a Tax Executive Director at ThinkTX Consultants, with over a decade of experience delivering strategic and practical tax solutions. He advises high-net-worth individuals, multinational corporations, and growing businesses, helping them manage complex tax matters with clarity and confidence.
He has extensive experience across a broad range of tax engagements, including corporate tax compliance, Capital Gains Tax (CGT), withholding tax, stamp duty, Real Property Gains Tax (RPGT), Sales and Service Tax (SST), and advisory on inbound and outbound investments. He also leads practice areas covering tax incentives, tax audits and investigations, private client advisory, tax due diligence, and e-Invoicing advisory, providing comprehensive support across the business life cycle.
Beyond client advisory, Pugaleshwaran actively contributes to the tax profession through writing and speaking on Malaysian tax policy, regulatory developments, and industry best practices. His work has been published by the International Bureau of Fiscal Documentation (IBFD) and Wolters Kluwer (CCH), including contributions to Malaysia’s Sales and Service Tax (SST) content updates.
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As a trusted tax partner of RinggitPlus, Pugaleshwaran reviews and verifies Malaysian taxation content to ensure it is accurate, compliant, and relevant for everyday Malaysians.
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