British Expat Guide – How to Reside in Malaysia

I have lived in Thailand for the majority of my time as an expat and traveled around a few other countries. One of those was Malaysia and I have some good friends in Malaysia, one whom I went to university with. Malaysia in my eyes is an underrated place as many expats will go for the big-name cities like Bangkok, Beijing, Singapore, Dubai, and a couple of others. However, Kuala Lumpur is a city that is a good size but one that goes under the radar in my eyes. If you are an expat looking to reside in Malaysia because of its cost of living, quality of life, and landscape, here is a guide full of information for you.

If you have any questions, please contact me at the bottom of the page.

Residing in Malaysia provides access to a thriving and expanding economy, affordable cost of living, political stability, and breathtaking landscapes encompassing lush rainforests, pristine beaches, modern urban centers, towering mountains, and vibrant plantations. Positioned as the fourth largest nation in Southeast Asia, Malaysia extends abundant prospects for expatriates hailing from all corners of the world.

The country boasts a commendably low crime rate and elevated living standards, attributed to the accessible affordability of daily necessities such as transportation, food, housing, and fuel.

Through a range of diverse programs, notably the Malaysia My Second Home scheme (MM2H), the country has emerged as a coveted destination offering advantageous tax incentives, exceptional education and healthcare systems, well-developed infrastructure, and a warm, extraordinarily genial culture celebrated for its hospitality.

International individuals have the opportunity to secure ten or twenty-year multiple-entry visas, extendable to their family members, with investment requirements starting at RM 1 million.

Investment-Based Residency Choices

Malaysia presents two primary investment-based residency options: the Malaysia My Second Home (MM2H) program and the Premium Visa Program. Both initiatives offer extended stay visas through qualifying investments, primarily targeting affluent retirees.

For MM2H application eligibility, individuals must be at least 35 years old, capable of financially supporting themselves and their dependents, and possess an offshore income of no less than RM 40,000 (£7,172) per month. Additional prerequisites encompass owning assets valued at a minimum of RM 1.5 million (£268,947). Aspiring participants are required to:

• Invest a minimum of RM 1 million (£179,298), along with an extra RM 50,000 (£8,965), into a fixed deposit Malaysian account, maintained throughout their visa tenure.
• Withdraw no more than RM 500,000 (£89,649) after one year for approved expenditures like medical costs, education, or property purchases within Malaysia.
• Spend a minimum of 90 days annually in the country. This condition pertains to the principal applicant and spouse, whereas dependents including children are exempt from the minimum stay rule.

The alternative path to Malaysian residency is the Premium Visa Program, which functions somewhat differently by granting a 20-year visa renewable every five years. Applicants must fulfill the same monthly income and investment criteria while paying an additional fee of RM 200,000 (£35,860), plus RM 100,000 (£17,930) for each dependent covered by the visa.

Unlike MM2H, Premium Visa candidates have no age restrictions and can engage in employment or business activities without mandatory physical presence requirements.

It’s important to note that neither visa category offers a route to permanent residency or citizenship with a second passport. However, individuals under either visa can live in Malaysia for up to ten or 20 years, along with their dependents.

Application Process and Timeline

The process for investment-based residency applications generally takes three to six months for approval. Upon the initial visa approval, applicants must visit Malaysia in person to establish a bank account and fulfill medical examination obligations.

Visa Regulations and Taxation

British citizens typically enjoy visa-free travel to Malaysia for up to three months upon arrival. Non-tourist travelers seeking longer stays or work permits must apply for the relevant visa or permit from the nearest consulate.

For tax considerations, expats are usually classified as Malaysian tax residents after residing in the country for a minimum of 183 days annually. Residents with long-term visas receive favorable tax treatment, including exemption from taxes on foreign-sourced income. Malaysia has established numerous double tax treaties to enable expats to offset liabilities from other jurisdictions.

Tax-resident individuals are obligated to declare their income to the Income Revenue Board of Malaysia. Personal tax allowances are applicable before determining the net taxable income subject to income tax. Malaysia employs a progressive tax band system similar to that of the UK, with projected 2023 income tax rates ranging from 26 percent on earnings between RM 400,001 (£71,719) and RM 600,000 (£107,579), up to a maximum rate of 30 percent on income exceeding RM 2 million (£358,596)

Healthcare in Malaysia

International Health Insurance Plans: These plans are specifically designed for expats and provide coverage both within Malaysia and often globally. They offer comprehensive coverage, including outpatient, inpatient, emergency medical services, and sometimes dental and vision care. These plans can be tailored to your needs and budget.

Local Health Insurance Plans: Some insurance companies in Malaysia offer health insurance plans designed for both locals and expats. These plans might be more cost-effective compared to international plans. However, ensure that the coverage is adequate and that the plan includes services you might require.

Employer-Sponsored Insurance: If you’re moving to Malaysia for work, your employer might offer health insurance coverage as part of your employment package. Make sure to review the coverage details, including whether it extends to your family members and if it’s sufficient for your needs.

Malaysia’s Public Healthcare System: Malaysia has a public healthcare system that provides affordable medical services to citizens and residents. Expats can also access public healthcare, but the quality and waiting times might vary. Many expats prefer to have private health insurance to access private healthcare facilities for faster and potentially higher-quality care.

Healthcare Maintenance Organizations (HMOs): HMOs offer a network of healthcare providers, and you pay a fixed monthly premium for access to their services. This can be a cost-effective option, but make sure the network includes facilities and doctors you’re comfortable with.

Healthcare Benefits Under the MM2H Program: If you’re in Malaysia under the Malaysia My Second Home (MM2H) program, you might be required to have health insurance coverage. The specific requirements can vary, so check with the MM2H authorities for details.

When considering health insurance options, keep these factors in mind:

Coverage: Ensure the plan covers a wide range of medical services, including hospitalization, doctor visits, prescription medications, and emergency care.

Network: Check if the insurance provider has a network of hospitals, clinics, and doctors in Malaysia. Having access to a reliable network can make healthcare processes smoother.

Exclusions: Understand what the policy doesn’t cover. Some plans might have exclusions for pre-existing conditions, certain treatments, or high-risk activities.

Cost: Compare premiums, deductibles, and out-of-pocket expenses. Choose a plan that fits your budget while providing adequate coverage.

Claim Process: Understand how the claims process works. Some plans might require you to pay upfront and then reimburse you later, while others might have a direct billing system with healthcare providers.

Additional Services: Some plans might offer additional services such as wellness programs, preventive care, or maternity coverage.

Types of plans

International Health Insurance Plans: These plans are specifically designed for expats and provide coverage both within Malaysia and often globally. They offer comprehensive coverage, including outpatient, inpatient, emergency medical services, and sometimes dental and vision care. These plans can be tailored to your needs and budget.

Local Health Insurance Plans: Some insurance companies in Malaysia offer health insurance plans designed for both locals and expats. These plans might be more cost-effective compared to international plans. However, ensure that the coverage is adequate and that the plan includes services you might require.

Employer-Sponsored Insurance: If you’re moving to Malaysia for work, your employer might offer health insurance coverage as part of your employment package. Make sure to review the coverage details, including whether it extends to your family members and if it’s sufficient for your needs.

Malaysia’s Public Healthcare System: Malaysia has a public healthcare system that provides affordable medical services to citizens and residents. Expats can also access public healthcare, but the quality and waiting times might vary. Many expats prefer to have private health insurance to access private healthcare facilities for faster and potentially higher-quality care.

Healthcare Maintenance Organizations (HMOs): HMOs offer a network of healthcare providers, and you pay a fixed monthly premium for access to their services. This can be a cost-effective option, but make sure the network includes facilities and doctors you’re comfortable with.

Healthcare Benefits Under the MM2H Program: If you’re in Malaysia under the Malaysia My Second Home (MM2H) program, you might be required to have health insurance coverage. The specific requirements can vary, so check with the MM2H authorities for details.

Schooling in Malaysia (top schools for expats)

1. The Alice Smith School: This is one of the oldest and most well-established international schools in Kuala Lumpur. It offers a British curriculum and has a strong reputation for academic excellence and extracurricular activities.
2. Garden International School: Garden International School is another prominent international school with a British curriculum. It offers a comprehensive education from early years to pre-university levels.
3. International School Kuala Lumpur (ISKL): ISKL is a leading international school in Malaysia that follows an American curriculum with an International Baccalaureate (IB) program. It is well-regarded for its academic standards and diverse community.
4. Nexus International School: Nexus offers the International Primary Curriculum (IPC), International Middle Years Curriculum (IMYC), and International Baccalaureate Diploma Programme (IBDP). It’s known for its modern facilities and innovative teaching approaches.
5. British International School of Kuala Lumpur (BSKL): BSKL offers a British-style education and follows the English National Curriculum. It’s part of the Nord Anglia Education network.
6. Mont’Kiara International School (MKIS): MKIS offers the International Baccalaureate Primary Years Programme (PYP), Middle Years Programme (MYP), and Diploma Programme (DP). It’s known for its inclusive environment and commitment to holistic education.
7. Epsom College in Malaysia: This school is affiliated with Epsom College in the UK and offers the British curriculum. It’s known for its strong academic focus and boarding facilities.
8. Joseph’s Institution International School (SJI International): While not British curriculum-based, SJI International offers International Baccalaureate programs and is known for its values-based education.
9. Fairview International School: Fairview offers the International Baccalaureate program and other curricula. It has a reputation for academic excellence and a strong emphasis on language education.
10. Sayfol International School: Sayfol offers a British curriculum and is known for its multicultural environment and academic standards.

Cost of living in KL (Source 2023 Numbero)

Accommodation:

• Rent for a one-bedroom apartment in the city center: Approximately 2,000 – 3,500 MYR per month
• Rent for a one-bedroom apartment outside the city center: Approximately 1,300 – 2,500 MYR per month

Utilities:

• Basic utilities (electricity, heating, cooling, water, and garbage): Around 200 – 300 MYR per month

Transportation:

• Monthly public transportation pass: Approximately 100 – 150 MYR
• Taxi starting fare: Around 5 – 6 MYR
• Gasoline (1 liter): Approximately 2.00 – 2.50 MYR

Groceries:

• Milk (1 liter): About 5 – 7 MYR
• Loaf of bread: Around 4 – 6 MYR
• Rice (1 kg): Approximately 5 – 8 MYR
• Chicken (1 kg): About 10 – 15 MYR
• Fresh fruits and vegetables (per kg): Varies based on the type of produce

Dining Out:

• Inexpensive meal at a local restaurant: Around 10 – 20 MYR
• Three-course meal for two at a mid-range restaurant: Approximately 100 – 150 MYR

Entertainment:

• Movie ticket: About 15 – 25 MYR
• Fitness club monthly membership: Around 150 – 250 MYR

Healthcare:

• Doctor’s visit (basic consultation): Approximately 50 – 100 MYR
• Prescription medication (varies based on type and brand): Costs can vary significantly

Education:

International school fees (varies based on school and grade level): Generally, tuition fees can range from 20,000 to 60,000 MYR or more per year.

Further Reading

Expats Property Guide To Asia

Comparing Platforms – Novia vs Morningstar for Expats

Mitigating Inheritance Tax: Strategies for British Expats