Expense Reimbursement in Malaysia

Modified on: Wed, 3 Sep, 2025 at 2:59 PM

TABLE OF CONTENTS

Invoicing and Documentation
Reimbursement and Taxability
Entertainment and Gifts
Health and Wellness
VAT
Travel and Mileage
Parking and Toll
Business Travel Restrictions
Transport Service Rules

This article outlines the policies and procedures for travel, mileage, invoicing, and reimbursement of business expenses for employees based in Malaysia.

Invoicing and Documentation

Invoices and receipts should clearly indicate:
- Vendor name
- Date
- Description of good and/or services
- Total amount
When relevant, list Horizons as the purchasing entity.
- Horizons Global Technology Malaysia Sdn. Bhd
- 256B, Jalan Bandar 12, Taman Melawati, 53100 Kuala Lumpur, Selangor, Malaysia

Reimbursement and Taxability

Tax-Free Reimbursements

Reimbursements for business-related expenses are typically non-taxable when properly documented.
Optical reimbursements are consiudered taxable benefits.

Entertainment and Gifts

Must be justified.
Taxable if not directly business-related.

Health and Wellness

Generally not taxable if:
- Directly related to health and safety of the employee, spouse, or children.
- Covered by a company health plan
Examples of taxable items:
- Gym memberships
- Yoga classes
- Similar personal wellness activities.

VAT

Malaysia does not have VAT system, it operates under States and Service Tax (SST) regime.
SST is not reimbursable and is considered part of the total cost of the expense.

Travel and Mileage

Mileage Rates

The reimbursement rate is RM 0.90 / KM

Parking and Toll

Submit as separate expense items.
Must include receipts.

Business Travel Restrictions

No statutory cap on business travel.
Restrictions are subject to each employer's internal policy.

Transport Service Rules

Mileage claims apply only to the use pf personal vehicles.
Air, bus, train, tram, taxis, rental cars
Requirements:
- Receipts
- Approval