aintenance Fees for Shops and Offices Are Now Exempt from Service Tax

If you own a shop lot or an office unit, here is some good news.

From 1 July 2026, the maintenance fees and sinking fund you pay to your developer, JMB or MC are exempt from service tax.

This comes from Customs' Dasar Cukai Perkhidmatan Bil. 3/2026 (Pindaan No.1), issued on 2 November 2026.

So, why is it called an exemption?

The government has decided that these charges should not be taxed. But the Service Tax Regulations 2018 have not been amended yet.

Until then, the Finance Minister has given an exemption. Owners do not need to pay, and the developer, JMB or MC does not need to charge.

So, what about the period before 1 July 2026?

There is no exemption for that period. Any service tax payable up to 30 June 2026 must still be paid to Customs.

If it was not paid, Customs can collect it from the developer, JMB or MC.

Does this mean building costs will go down?

Not necessarily. The exemption only covers the maintenance fees and sinking fund. If the JMB or MC uses these funds to pay for other taxable services, those services are still taxed.

In simple terms, owners stop paying service tax on maintenance fees from 1 July 2026, but anything due before that still has to be settled.

From a business perspective, owners may want to check their maintenance bills from July onwards to see whether service tax is still being charged. JMBs and MCs may want to review the bills already issued and confirm the treatment with Customs.

On the same day, Customs also extended a separate exemption for aircraft and ship maintenance to DGTA approved maintenance organisations, from 22 September 2026 to 31 December 2027.

If you own a commercial unit or handle the accounts of a JMB or MC, our team can help review your maintenance bills and service tax filings, and check which periods are exempt. Feel free to WhatsApp us at 010-246 2151.