Malaysia SST Regulations 2025
SCRAP MATERIAL SALES
Tax-Exempt (0% SST):
- Raw ferrous/non-ferrous metal scrap (iron, copper, aluminum)
- Recyclable paper/plastic/glass waste
- Condition: Must sell to licensed recycling facilities
Taxable (10% SST):
- Processed scrap (shredded/pelletized materials)
- Sales to non-licensed buyers
- Industrial by-products with commercial value
SECOND-HAND CAR SALES
Margin Scheme (10% SST):
- Applies ONLY to registered car dealers
- Tax calculated on profit margin:`SST = 10% × (Selling Price - Purchase Price)`
- Example: Buy RM30k → Sell RM40k = SST RM1,000
Exempt Transactions:
- Private sales between individuals
- Vehicles > 10 years old
- Emergency/service vehicles
KEY REQUIREMENTS
For Scrap Sellers:
- Verify buyer's recycling license
- Raw materials only qualify for exemption
- Processed scrap taxed as "new goods"
For Car Dealers:
- Maintain original purchase invoices
- Imported used cars: Additional 10% LVG tax
- Trade-ins: Use trade-in value as purchase price
DOCUMENTATION
Scrap Sales Must Keep:
- Copy of buyer's recycling license
- Weighbridge/quality certificates
Used Car Dealers Must Keep:
- Original purchase invoice
- PUSPAKOM inspection report
- Margin calculation records
PENALTIES
- Scrap misclassification: 30% back-tax fine
- Unreported car profits: 100% penalty on evaded SST