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Budget 2027 Malaysia: What It Means for Clinics, Salons and Spas
Budget 2027, tabled on 9 October 2026, cuts the SME tax rate by 1 percentage point, raises the minimum wage to RM 2,000 from June 2027, and lets small businesses write off assets up to RM 3,000 in full. For a clinic, salon, beauty centre or spa, the biggest changes are tax, staff costs and help to go digital.
This guide is general information as at October 2026, not tax advice. Budget measures are proposals until the Finance Act is passed and gazetted, so details may still change. Check your own case with your accountant.
How much lower is the SME tax rate in 2027?
From year of assessment (YA) 2027, the proposed rates for small and medium companies are:
| Chargeable income | Before | YA 2027 |
|---|---|---|
| First RM 150,000 | 15% | 14% |
| RM 150,001 to RM 600,000 | 17% | 16% |
| Above RM 600,000 | 24% | 24% |
A company that makes RM 600,000 or more in chargeable income saves up to RM 6,000 a year. A smaller one saves less, for example RM 1,500 on RM 150,000. The government expects about 300,000 SMEs to benefit.
What happens to the minimum wage in June 2027?
The minimum wage goes up from RM 1,700 to RM 2,000 a month from June 2027. Micro, small and medium businesses with annual sales below RM 50 million are exempted from the new rate for a transition period.
Even if you are exempt for now, it helps to plan early. Here is a made-up example for a salon with 5 staff on RM 1,700:
| Made-up example | Amount |
|---|---|
| Increase per staff | RM 300 a month |
| 5 staff | RM 1,500 a month |
| Over 12 months | RM 18,000 |
Employer EPF, SOCSO and EIS go up with the wage too. A new minimum starting salary of RM 2,500 is also proposed for graduates and semi-skilled workers.
From YA 2028, businesses that are not MSMEs can only claim salaries as a tax deduction if they pay through a bank or other cashless method. Paying salaries by bank transfer is a good habit for everyone.
What can small businesses claim for new equipment?
Two proposals help when you buy hardware or software:
- Small value assets. From YA 2027, MSMEs can claim 100% capital allowance on each asset worth up to RM 3,000, up from RM 2,000. Think tablets, receipt printers, barcode scanners or a queue number display.
- ICT equipment and software. The accelerated capital allowance for ICT equipment and software is extended to 31 December 2030.
Ask your tax agent which of your purchases qualify before you buy.
Is there help to use AI and automation?
Yes. Budget 2027 gives RM 30 million through MDEC to help 4,000 MSMEs adopt AI and automate their work. Eligibility and how to apply were not published yet as at mid-October 2026, so watch MDEC's announcements.
You don't need a big project to start. Simple automation already saves hours every week:
- WhatsApp appointment reminders sent for you
- Delivery notes scanned by AI, with stock adjusted automatically
- Payroll and commission worked out from your POS
- Daily sales reports without copying numbers into Excel
What changes for your staff?
Several proposals put a little more money in your staff's pockets from YA 2027:
- Individual relief goes up from RM 9,000 to RM 12,000, the first increase since 2010. Their monthly tax deduction (PCB) will be lower.
- MediAsas, a low-cost medical plan, starts in January 2027. SMEs with fewer than 75 workers get RM 200 off the first-year premium per worker, for up to 50 workers.
- Medical relief (RM 10,000) now also covers postnatal and confinement care, up to RM 3,000. Clinics that offer postnatal care may want to keep clear receipts for patients.
Want to see how the new reliefs change one person's tax? Our free tax relief calculator already includes the YA 2027 proposals.
How Techub helps you get ready for 2027
Techub's systems help a clinic, salon, beauty centre or spa keep costs, staff and records in order:
- Payroll with basic salary, commission, allowances, EPF, SOCSO, EIS and PCB, ready when the minimum wage changes.
- AI stock control: scan a delivery note and stock is adjusted automatically, with every movement tracked.
- Reports for sales, staff and stock that your accountant can use at year end.
- LHDN e-Invoice built in if you choose to issue it. See our e-Invoice guide.
See our Clinic Management System, Salon Appointment System, Beauty Appointment System and Spa Appointment System.
Plans start from RM 99/month per outlet with our Welcome offer (12 months plus 2 months free, only RM 84.86 a month on average) for the first 250 users until 31 Dec 2026, or RM 178 month by month, and new users get the first 3 months free, including installation and staff training. See pricing for details.
Sources: PwC Malaysia, EY Malaysia, Bernama, The Star.
Questions people ask
What is the SME tax rate in Malaysia for 2027?
Under Budget 2027, the proposed SME rate from YA 2027 is 14% on the first RM 150,000 of chargeable income and 16% on RM 150,001 to RM 600,000. Income above RM 600,000 stays at 24%. It becomes law once the Finance Act is gazetted.
When does the RM 2,000 minimum wage start?
The minimum wage rises from RM 1,700 to RM 2,000 a month from June 2027. Businesses with annual sales below RM 50 million are exempted for a transition period, according to Budget 2027.
Does Budget 2027 help small businesses go digital?
Yes. It gives RM 30 million through MDEC to help 4,000 MSMEs adopt AI and automation, raises the small value asset write-off to RM 3,000 per asset, and extends the ICT equipment and software allowance to 31 December 2030.
See it running in your business
Want payroll, stock and reports ready for 2027 in your clinic, salon or spa? Book a free demo with us on WhatsApp.
From RM 99/month per outlet · 3 months free
