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Compliant with Malaysian law

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Learn more about Rent Receipt in Malaysia

A Rent Receipt is a legal document that shows how much your tenant paid during the specified time period. You are not obligated as a landlord to provide a receipt to your renter every month unless the tenant asks for one, although receipts help landlords determine which tenants have paid and which have not. We disclose the date you paid the rent, the amount of rent paid, and the identity of the payer on our receipts, among other things, which can protect you if the renter does not pay you the entire amount or pays late. These important documents not only assist landlords in keeping thorough records, but they also offer tenants with verification that their rent has been paid. With Themis Partner, get your rent receipt to protect your property and provide proof of tenant payment.

📄  Related documents

Lease agreementLeasehold contractLate rent noticeEviction notice letter
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Table of contents

  1. What is a Rent Receipt?
  2. What is included in a Rent Receipt?
  3. Why use a Rent Receipt?
  4. How to send a Rent Receipt?
  5. How is Rental Income taxed in Malaysia?
  6. Do you have to pay Tax if you declare Rental Income?
  7. What expenses can be deducted from Rental Income in Malaysia?

What is a Rent Receipt?

A Rent Receipt is a written slip that a landlord delivers to a renter after they pay rent. Rent Receipts are useful for a variety of reasons, but the most important is that they demonstrate that renters have paid their rent. Having proof of payment is especially critical when a tenant’s payment method is difficult to follow, such as cash. Rent Receipts have several advantages when it comes to handling tenancies. A Rent Receipt can assist you with:

➤ Maintain a professional demeanor with your tenants
➤ Keep track of tenant payments and stay organized
➤ If your state mandates it, follow the law
➤ Delight and impress your tenants, which should result in fewer tenant turnover

What is included in a Rent Receipt?

You’ll want to include the following information on your rent receipt template for your renters’ and your own records:

➤ Contact informations
➤ From whom you are receiving paid
➤ The whole sum paid
➤ Location of the rental
➤ The rental duration
➤ The method of payment
➤ Day of payment

The more information you provide on the rent receipt, the easier it will be to keep track of everything. Keep printed or digital copies of the receipts for as long as you need them for financial or personal reasons..

Why use a Rent Receipt?

To claim House rent allowance (HRA), you must produce proof of rent payment to your employer; rent receipts are acceptable. After validating the deductions and allowances, the employer can deliver them. The HRA allowance is determined in accordance with the rent revenues.

How to send a rent receipt?

You have several options for delivering the receipt to your renters. You may distribute the receipts straight to your renters or mail them if you print the form and fill it out as needed. If you want an easier way to offer receipts, try sending them by email. A PDF of the rental receipt may be created and filled out, then emailed to each tenant. Another advantage of utilizing email for receipts is that you will instantly have a record of it in your “sent mail’ folder.

How is Rental Income taxed in Malaysia?

Rental is one such blunder that is becoming more common. People are being penalized under Section 113 of the Income Tax Act of 1967 for failing to register their rental income.

There is a common misperception that rental income is considered an investment and hence free from taxation. The rental revenue beginning date begins on the first day the property is rented out, although the actual rental income is calculated based on receipts.Rental revenue is calculated on a net basis, which implies that it can be decreased by certain deductible costs.

Do you have to pay tax if you declare Rental Income?

If your rental income is classified as non-business income, you must add the amount earned from the rental to your overall income. You will be required to pay tax only if:

➤ Your annual income surpasses RM34,000, and your monthly earnings are roughly RM2,833.33. This includes EPF deductions.
➤ Your income exceeds RM38,202.5 per year or RM3183.52 per month if EPF contributions are not made.

As a result, your income is determined by how much you make per year or monthly. You may view the chargeable income and tax imposed on the LHDN’s official website. According to the 2020 budget, the present tax rate ranges from 0% to 30% of your income.

What expenses can be deducted from Rental Income in Malaysia?

So, what exactly are these rental income deductible expenses? They are as follows, according to the Inland Revenue Board Malaysia LHDN:

➤ Assessment tax
➤ Rent should be canceled
➤ Mortgage interest
➤ The cost of fire insurance
➤ Expenses involved in collecting rent
➤ Expenses incurred as a result of rent renewal
➤ Repair and property upkeep costs

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