PETALING JAYA: Dividends from government-backed retirement and unit trust funds are not subject to the 2% tax on dividend income exceeding RM100,000, says the Inland Revenue Board (LHDN). The 2% dividend tax was introduced under Budget 2025 as part of efforts to strengthen Malaysia’s tax system and broaden the revenue base without significantly affecting most taxpayers. Meanwhile, LHDN said the requirement to declare dividend income exceeding RM100,000 is not limited to dividends derived from personal shareholdings. “Under this measure, a 2% tax is imposed on chargeable dividend income exceeding RM100,000 annually, after taking into account allowable deductions and reliefs. “This reflects the government’s intention to make the individual income tax structure more progressive while broadening the tax base,” said the board.

Source: The Star March 25, 2026 09:50 UTC