Service tax (SST) on restaurant bills in Malaysia

Before you read

This guide is general information, not tax advice. Each rule links to the Royal Malaysian Customs (MySST) page it comes from, with the day we read it. Check your own situation with your accountant or Customs before you change how you bill.

The rate for food and beverage: 6%

Service tax in Malaysia went up for most services, but not for food and beverage. Customs' FAQ says the service tax rate changed from 6% to 8% from 1 March 2024, while food and beverage (F&B) services remain at 6%.^[1]

So a registered restaurant, café or bar charges 6% service tax on its food and drink.

Who must register

Not every food business charges service tax — only those registered. The threshold for food and beverage is set out on Customs' registration page: for operators of a restaurant, bar, snack bar, canteen, coffee house or any place providing food and drinks (eat-in or take-away), caterers and food court operators, the registration threshold is RM1,500,000; canteens in educational institutions or run by religious bodies are excluded.^[2]

Below the threshold a restaurant need not register — a business below the threshold may register voluntarily if it supplies taxable services^[2] — and an unregistered restaurant's bills carry no service tax. If your turnover is close to the threshold, talk to your accountant about how Customs measures it and when you would need to register.

Service charge and tips

Many Malaysian restaurants add a 10% service charge. Whether it is taxed matters for the bill. In Customs' FAQ for food and beverage operators, a service charge is not subject to service tax, and tips are not subject to service tax; Customs' Food & Beverages industry guide (paragraph 12) adds that the service tax is worked out on the actual price, excluding the service charge.^[3]

Read that with your accountant against your own situation, and set your POS to match what applies to you.

For a comparison with other countries, see our guide to service charges and tips.

How the bill reads

A typical bill from a registered restaurant shows:

• the dishes and their prices;
• any discount;
• any service charge, as its own line;
• service tax at 6%, with its amount;
• any rounding, as its own line;
• the total.

Showing the service charge and the service tax as separate lines lets the guest — and anyone checking your records later — see exactly what was charged on what.

A worked bill

Take a registered restaurant with prices before tax, a 10% service charge, and the treatment in Customs' F&B FAQ, where the service charge carries no service tax:^[3]

• food and drink: 100.00;
• service charge 10%: 10.00;
• service tax 6% on the food and drink: 6.00;^[1]
• total: 116.00.

If your accountant tells you a different treatment applies to you, the service tax line changes — which is why it is worth printing a test bill and adding it up by hand once before you open.

Prices before tax

If your menu shows prices before service tax and service charge, with the charges added on the bill, say so on the menu, so guests are not surprised at the end of the meal.

Setting it up in BillDine

What BillDine does for a restaurant in Malaysia today:

• SST ready. In quick start, tick that your business is registered, type your SST number and keep the usual rates ticked: BillDine adds SST 6%. Later it is under Settings → Billing rules → Taxes → Ready-made taxes.
• Tax added on top. A new outlet in Malaysia adds service tax on top of menu prices.
• The optional service charge has no tax. Quick start can add a 10% service charge on dine-in bills, and BillDine adds it with no service tax on it, as Customs' F&B FAQ says. An outlet set up before 29 October 2026 may still have SST on its charge: Settings → Billing rules → Taxes then says so. Check with your accountant, open Settings → Billing rules → Charges, edit the charge and choose No tax as its tax group.
• Taking the charge off. Staff can remove the service charge from a single bill on the POS, and waiters may do so.
• Not registered? Choose Not registered for … in Business details: no tax is charged, no number is printed, and bills are titled "Bill".
• Cash rounding. A new outlet in Malaysia rounds cash payments to 0.05, while a card pays the exact total; the rounding shows as its own line and tax is never rounded away.
• DuitNow. DuitNow is ready as a payment method, recorded like cash but not counted in the cash drawer.
• For your return. The tax report shows the tax your bills charged by rate for any period, and exports as CSV or PDF. See reports.

A short checklist

1. Check your turnover against the RM1.5 million F&B threshold.
2. If registered, charge 6% service tax on food and drink.
3. Decide whether you add a service charge, and check its tax treatment with your accountant.
4. Show service charge and service tax as separate lines.
5. Tell guests on the menu if charges are added on the bill.
6. Print a test bill and read every line.