Short answer. You register for SST only if what you sell is taxable and your sales of it pass the threshold for your category. There is no single small-business threshold, and a business can owe nothing even at high turnover if it sells nothing on RMCD's taxable list. So the useful question is not "how big am I?" but "which category am I in, and have my taxable sales in the last 12 months passed that category's line?"
This page is for owners. If you want to know what SST adds to what you pay as a consumer, read SST in Malaysia explained instead. Figures below are from the Royal Malaysian Customs Department (RMCD) MySST pages and gazetted regulations, linked in each section, as at the date this page was last updated (see the byline).
Step 1: are you selling goods or services?
SST is two separate taxes:
- Sales tax is charged on taxable goods. RMCD's sales tax FAQ describes a taxable person as a person who manufactures taxable goods. The sales tax rate is 5% or 10% or a specific rate, per RMCD.
- Service tax is charged on taxable services, in groups. The standard rate is 8%, and 6% applies to food and beverage, parking, logistics and telecommunications. Construction work services (excluding residential building construction and public areas related to that residential building) are also 6%.
If you only resell goods or provide a service that is not on RMCD's list, neither tax may apply to you. Check the list on MySST or ask RMCD instead of assuming.
Sources: MySST, Registering a Business and MySST, Sales Tax FAQ.
Step 2: find your threshold
| What you do | Threshold (RMCD) | Where it comes from |
|---|---|---|
| Manufacture taxable goods | RM500,000 of taxable goods sold in a 12 months period | MySST registration page |
| Group G services | total value of taxable services, combined or single, of more than RM500,000 | MySST business FAQ |
| Construction work services, excluding residential building construction and public areas related to that residential building | RM1,500,000 | Expansion FAQ and regulations |
| Rental or leasing (Group K) | RM1,000,000 | P.U.(A) 201/2025 |
| Finance, Group H items 2, 3 and 4 | RM1,000,000 | P.U.(A) 201/2025 |
P.U.(A) 201/2025 came into operation on 1 July 2025. It replaced the earlier RM500,000 for rental or leasing and for those finance items with RM1,000,000. RMCD's older FAQ pages may still show RM500,000 for them, so use the regulation if the two disagree.
If your business is not in the table, the answer is not "no threshold applies". Look up your group on MySST before you decide.
Sources: MySST business FAQ, MySST expansion FAQ, P.U.(A) 201/2025.
Step 3: count the right turnover
RMCD tests the value of taxable sales, not your total revenue, over the period in the rule. For Group G, RMCD's business FAQ says the test is the total value of taxable services, whether combined or single, so several taxable services in the group are added together. If you sell across two different groups, ask RMCD before you register or decide you do not need to.
A practical way to test it:
- List what you sold in the last 12 months.
- Mark which items fall in a taxable goods or service group.
- Add up only those, and compare with the line in the table.
- Repeat the check from time to time, because the thresholds are measured over a period and not on a single sale.
What happens if you pass the line
Once you are liable, you register with RMCD through MySST and then charge the tax on taxable sales. Registration deadlines, return filing dates and penalties are on RMCD's own pages. The one thing this page can say with confidence is that guessing wrong in either direction costs money: registering when you did not need to adds a tax you have to charge and account for, and not registering when you did can leave you owing tax you never collected.
Three mistakes to avoid
- Testing total revenue. The thresholds above are about taxable sales in a category, not everything you earn. A large turnover from non-taxable work does not by itself make you liable, and a small amount of taxable work can still matter if it is the part RMCD's rule counts.
- Trusting the older page. When an RMCD FAQ and a gazetted regulation disagree, the regulation governs. P.U.(A) 201/2025 is the example in the table.
- Copying a competitor's decision. Two businesses with the same turnover can be in different groups. Work out your own category from RMCD's list, not from what a similar business did.
Where SST meets your other obligations
- Income tax. SST is separate from income tax. Your profit and personal tax are covered in our freelancer tax guide and the income tax calculator.
- E-invoices. If you are above LHDN's exemption line, your invoices need to meet e-invoice rules as well. See the e-invoice guide.
- Choosing a structure. SST registration depends on what you sell, not whether you are a sole proprietor or a company. The structure comparison covers the choice.
- Setting up. Sole proprietorship or partnership registration and Sdn Bhd registration are separate from SST.
This guide is general information, not tax advice. RMCD publishes its contact details on MySST.