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SST comes up constantly in conversations about running a business in Malaysia, but the meaning behind the acronym — and who actually needs to deal with it — isn’t always clear. Here’s a straightforward breakdown.
What Does SST Stand For?
SST stands for Sales and Service Tax. It’s actually two separate taxes bundled under one name: Sales Tax, charged on taxable goods, and Service Tax, charged on prescribed taxable services.
Sales Tax vs Service Tax
Sales Tax applies to goods manufactured or imported into Malaysia, at rates of 5% for general goods and 10% for non-essential goods, with exported goods zero-rated.
Service Tax applies to prescribed taxable services at 6% for general services, and 8% for selected services (effective March 2024) — though food and beverage, telecommunications, parking, and logistics services remain at 6%.
Who Needs to Register for SST?
Registration becomes mandatory once your business’s annual taxable turnover crosses RM500,000. Once that threshold is exceeded, you have 30 days from the end of that month to register.
What Happens After You Register?
Registered businesses are required to file SST returns on a periodic basis and remit the tax collected. Missing these deadlines carries its own late filing and late payment penalties, separate from the penalty for failing to register in the first place.
For the complete step-by-step registration process, see our SST registration guide. Always verify current rates and thresholds with the Royal Malaysian Customs Department (RMCD), as these can be updated.
Keeping your accounting records accurate also makes SST compliance easier to manage — our accounting team can help keep your records and filings up to date.
Frequently Asked Questions
What does SST mean?
What's the difference between Sales Tax and Service Tax?
Do all businesses need to register for SST?
What's the SST registration threshold?
What happens if I don't register when required?
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