SST record keeping in Malaysia: what clients must keep

Since the service tax scope was widened on 1 July 2025, more of your clients have had to ask whether SST applies to them. Construction firms, rental businesses, beauty salons and private schools now sit inside the rules alongside the manufacturers and professional firms that were there before. Once a client is registered, the Customs record-keeping rules apply on top of the income tax ones, and they are stricter in one important way.

This is a plain summary for accounting firms. The rules are set by the Royal Malaysian Customs Department (RMCD) and change from time to time, so check MySST before advising a specific client. Last checked 16 October 2026.

Who must register for SST?

Sales tax applies to manufacturers of taxable goods. A manufacturer must register once its taxable sales go over RM500,000 in 12 months. The same threshold applies to sub-contract manufacturing work.

Service tax applies to businesses providing taxable services above a registration threshold. Most existing groups, including professional, accounting, consultancy, IT and management services, use RM500,000 in 12 months. Food and beverage uses RM1,500,000.

The 1 July 2025 expansion

From 1 July 2025, service tax was extended to new groups, each with its own threshold:

New taxable service	Registration threshold
Construction	RM1,500,000
Private healthcare for non-citizens	RM1,500,000
Beauty treatment	RM500,000
Rental or leasing	RM1,000,000
Fee-based financial services	RM1,000,000
Private education	Applies where fees exceed RM60,000 per student a year

Some MySST pages still show RM500,000 for rental and leasing and for financial services. The gazetted amendment, P.U.(A) 201/2025, sets RM1,000,000 for both, and the gazette is what counts. Rates differ by service, so check the expansion FAQ for the rate that applies.

The clients most likely to have crossed a threshold without noticing are the ones in the new groups: a contractor whose jobs grew, a landlord with several commercial units, a salon with two outlets.

How long must SST records be kept?

For 7 years, in Malay or English, kept in Malaysia, and a record that started on paper stays in its original form even after it is scanned. The rules are in section 24 of the Sales Tax Act 2018 and section 24 of the Service Tax Act 2018. Both say much the same thing.

Who. Every taxable person: a business that is registered, or should be.

What. Complete, true and up-to-date records of every transaction that affects or may affect its SST liability, including invoices, receipts, debit notes and credit notes, records of imports (sales tax) or imported services (service tax), and anything else the Director General decides.

How long. Seven years from the latest date the record relates to.

Language. Malay or English.

Where. In Malaysia, unless the Director General approves otherwise.

Electronic records. Allowed, as long as they are readily accessible and can be converted into writing.

Paper originals. This is the one that catches people out. Section 24(4) of both Acts says:

“Where the record is originally in a manual form and is subsequently converted into an electronic form, the record shall be retained in its original form prior to the conversion.”

In plain terms: for an SST-registered client, scanning a paper invoice or receipt does not mean the paper can be thrown away. The original has to be kept as well.

Penalty. Breaking section 24 is an offence, with a fine of up to RM50,000, imprisonment of up to three years, or both.

Returns and payment

• The taxable period is two months, ending on the last day of a month.
• The SST-02 return and payment are due by the last day of the month after the period ends. A nil return is still required when there is nothing to pay.
• Late payment carries a penalty that starts at 10% for the first 30 days and rises by 15% for each of the next two 30-day periods, up to 40% in total. See MySST on filing returns and penalties.

What about clients who are not registered?

The section 24 duty applies to taxable persons. A business that is not registered for SST, and does not need to be, is generally outside it. The exception is the Service Tax Act’s section 24(5A): a business that acquires imported taxable services in the course of its business has to keep those records even if it is not registered.

Unregistered clients still have to keep their business records for 7 years for income tax, under the Income Tax Act and LHDN’s public rulings on keeping sufficient records, such as Public Ruling 4/2000 for companies. So the receipts and supplier invoices go in the same place either way. See how long to keep receipts in Malaysia.

A checklist for SST-registered clients

1. Keep every invoice, receipt, debit note and credit note, issued and received, for 7 years.
2. Keep them in Malay or English, and in Malaysia.
3. Keep the paper originals, even after scanning.
4. Keep a clear digital copy as well, searchable by supplier, date and amount, because thermal receipts fade long before 7 years are up.
5. Match the records to the bank statement monthly, so gaps show up while the client can still find the document. See our bank reconciliation guide.
6. Diarise the SST-02 dates: the last day of the month after each two-month period.

Where AccPilot fits

AccPilot is the digital half of this, and it takes the sorting, photostatting and keying off your staff. Clients send receipts and invoices by upload, phone, email or your client link. AccPilot reads each one, matches them to the bank statement, and your staff export one clean Excel into your accounting software. Every document stays searchable for 7 years.

For an SST-registered client, that clear, searchable copy sits alongside the paper originals the Acts ask them to keep. It does not replace them. What it does replace is digging through the boxes when Customs or LHDN asks for one invoice from three years ago.

To see it on your own clients’ documents, book a free demo.