“Boss, quick one… this REIT income still same like before right?”

That call came in between my meetings.
Very confident. Very casual.
I paused.

Because when a client says “same like before”, it usually means something already changed.

Later, I called him back.
We reviewed his portfolio over the phone.

Nothing unusual. Mostly REIT units held for years.
Stable income. No headache.
That’s why he liked it.

Then I shared the latest update from LHDN
Practice Note 2/2026.

He went quiet.
“Wait… this one change already?”

We compared with Public Ruling 1/2021 – Taxation Of Unit Holders Of Real Estate Investment Trust / Property Trust Funds

Same investment.
Different tax outcome.

Starting YA2026.

Before this, many investors enjoyed a simple system.
10% withholding tax. Final.

No need to declare. No need to think.
It felt settled.

From YA2026, that is no longer true.

If you are a resident individual:

Your REIT income is added to your total income.
Taxed based on your personal rate.
You must declare it yourself.

If you are non resident …
30% tax.

This is where most people get caught.
They still assume:
“Tax already deducted. No need to do anything.”

But now, responsibility shifts to you aka self assessment.

Some will pay more tax.
Some may under declare without realising.

That is where exposure begins.
Tax risk today is not about not knowing.
It is about relying on outdated understanding.

If you are holding REIT investments, this is worth reviewing early.
A simple review today can prevent a complicated explanation later.

Are you still assuming your investment income is already “settled” like before?

Read the full story in our blog
https://www.ktp.com.my/blog/reit-withholding-tax-malaysia/27mar2026