Angel Tax Incentives
To stimulate and encourage angel investments into start-ups in Malaysia, the Government of Malaysia is prepared to give an incentive by way of tax deduction to qualified individual investor(s) based on the qualified investments into a qualified start-up.

1. Qualifying Period
The Angel Tax Incentive is open for qualifying investments made up to 31 December 2026 only. The investment made by accredited angel investor(s) must be endorsed by the Ministry of Finance.

2. Eligibility Criteria for Angel Investors:

• Must be a tax resident in Malaysia
• Either considered as a High Net Worth Individual or a High Income Earner
• High Net Worth Individual – Total wealth or net personal assets of RM3million and above or its equivalent in foreign currencies; or
• High Income Earner - The gross annual income of not less than RM180,000 in the preceding period of 12 months; or jointly with his or her spouse, with gross annual income of RM250,000 in the preceding period of 12 months

3. Eligibility Criteria of the Investment made by Angel Investors:

• Investment must be made by qualified angel investor(s) into qualified start-up(s)
• Investment must not be from an immediate family member, i.e. spouses, children, parents, grandparents and siblings
• Shall be for the sole purpose of financing the activities as approved by the Ministry of Finance
• Investment is made by the angel investor for a period of two (2) years prior to the deduction
• Shares issued to the angel investor(s) are not disposed of within a period of two (2) years from the date the investment is made
• Shall not be more than thirty per cent (30%) of the issued and paid-up capital of the qualified start-up(s) and shares issued must be in the form of ordinary shares
• Minimum investment amount of RM5,000.00 and up to a maximum amount of RM500,000.00 per annum in total
• The investment to be made is paid in full and in cash (not in kind), where there is no obligation to pay back by the start-up(s) to angel investor(s)
• Shares issued by the start-up(s) must be reflected in the Shareholders’ Agreement
• The shares issued to the angel investor(s) must be in terms of ordinary shares only.

4. Tax Deduction:

• Upon the approval by the Ministry of Finance of the investment made, the angel investor will qualify for a tax deduction equivalent to the amount of investment made by the angel investor in the start-up. The deduction will be made in the third (3rd) year of the shareholding period.
• In the event the value of investment exceeds the aggregate income of the angel investor for that year of assessment, any excess amount will not be refunded nor carried forward to be set off against the angel investor’s future income in other years of assessment.

5. Angel Investor Accreditation
Angel investor accreditation is only valid for a period of two (2) years. Accreditation can be renewed as and when required. ATIO has the right to review the qualifying criteria for angel investors as and when required during the period.