Earning Money

Must-Have Financial Tools to Make Freelancing in Malaysia Easier

 freelancing in malaysia

Freelancing in Malaysia is not hard, but I think there is a steep learning curve when it comes to managing finances. Based on the conversations I’ve had, many freelancers in Malaysia have a ‘whatever works’ system. This leads to many undesirable side-effects, like:

  • Losing money to ridiculous fees
  • Lack of protection and recourse for clients who don’t pay
  • Indirect loss of income due to perceived lack of professionalism image

It’s hard to write about the complete range of tools that is needed for every freelancer in Malaysia. Some of you are freelance writers, freelance graphic designers, freelance artists. Some of you may freelance with companies like Uber, part-time as insurance/unit trust agents, do promoter-type work for events, or even MLM-type ‘business opportunities’.

For the purpose of this article, I’m going to focus on the must-have financial tools for online-based freelancing jobs, but the tools can be handy for anyone freelancing in Malaysia.

Related: Incomes and expenses of freelance writers in Malaysia

Tools to Receive Payment

Online Banking

I have 2 banks and set up online banking for both. If you can, have a separate (1) bank account and (2) credit card for just work expenses and incomes – this makes separating personal and business expenses during tax season easier. Online banking is the best tool to receive payment from within Malaysia, in my opinion. Always log in and check whether you have received payment – sometimes people scam you by claiming they have made the deposit, but they haven’t. Pictures of bank slips can be forged as well.

What I heard is you need a current account rather than a savings account. Current accounts allow you to write cheques. Personally, I have never needed to write cheques, so I don’t actually bother with current accounts and just use a savings account (link to a financial platform comparing different savings accounts in Malaysia). If you know more information about this, please add in comments.

You usually need a ‘referral’ from someone else in order to open a business current account. If you don’t have a referral, I’ve also seen some banks offering non-referral current accounts.

Addition from kind anon:

You might want to look into Standard Chartered Just One account. It’s free and it comes with a Savings Account + Current Account. The current account allows you to write cheques. Although the reason I opened one was the free IBFT


You must have PayPal – it’s one of the most common forms of payments for many online clients. You can link it to your Malaysian bank accounts for direct bank deposits (fees apply). One thing you must know is that PayPal has a ridiculous exchange rate. If your client sends you USD100, and XE price currently shows the MYR equivalent is RM415, PayPal will show it closer to RM400. This is their indirect fee.

Two common ways to use PayPal:

  • Use their invoicing platform and send your invoice directly to the client for the payment. The fee is 2.9%+$0.30 (last I checked), so it’s quite high!
  • Send clients your own invoice and ask them to make payment to your PayPal email address.

Between the two options, the second one is better UNLESS your client can absorb the fees. Then it’s pretty much equal. You’ll still subject to the indirect exchange rate fee though.

Bitcoin wallet

I’m paid in bitcoins for some of my jobs now and I don’t regret it one bit. In fact, I prefer it. I get to avoid the direct and indirect fees from PayPal, and they are easy to convert to MYR when I want to spend it. I also convert some of my bitcoins into USD (or GBP/EUR) – this is what I do to keep my money a bit diversified.

Being open to bitcoin payments also gives you a little bit more flexibility in terms of online jobs you can take. There are now bitcoin-specific job boards that are less crowded than the usual job boards. Less competition is usually a good thing.

There are many bitcoin wallets you can choose from. See my bitcoin newbies guide for this – you’ll learn which bitcoin service providers are available for Malaysians, how to accept it for payment, how to sell your bitcoins, how to keep it safe and more. The downside is that bitcoin can make your finances more complicated, so if you want to keep it simple then avoid this option.

Professional-looking invoice

After the completion of your work, your client will usually ask for an invoice. There are plenty of free invoice generators out there. You can also make your own invoice with Word or Excel. Always send your invoices in PDF!

I’m too lazy to describe what to include/what not to include, so here is a sample of my invoice (I’m using Financio):

 freelancing in malaysia


Tools for Tax Purposes

Register for a sole-proprietorship and open a file at LHDN

This is good for tax purposes and doubles as a selling point to increase your business’s legitimacy. State clearly that your business is registered – this will increase your clients’ confidence in you. My registration for 2 years only costs RM130.60.

Technically, if you make less than roughly RM34k per year (the number changes every year. I’m following the 2016 numbers), you don’t have to pay taxes. You don’t even have to open a file with LHDN. But open one anyway. It’ll save you a lot of headache in the future.

An updated ‘Business Incomes’ Spreadsheet – to record how much you earned

To find out how much you actually make a year, of course you must keep a tally of it. For simple, uncomplicated businesses, I recommend BlogJunkie’s Simple Accounting System for Freelancing Business.

An updated ‘Business Expenses’ Spreadsheet – to know what to deduct during tax season

If you make more than RM34k, you’ll have to pay taxes. The good thing is you can claim a fair number of items and deduct them as business expenses. If you want to deduct them, you MUST keep an updated Business Expenses spreadsheet. This tip can help save you hundreds and even thousands of ringgit in tax payments, so please do it. BlogJunkie’s Simple Accounting System above also explains how to keep tally of your business expenses.

DISCLAIMER: I am not a tax agent. This is based on my research, which may be flawed. I plan to engage the services of an accountant for next tax payment.

Some of the things you can claim are:

  • Office expense (hardware, software, furniture, ect for work)
  • Telecommunications for work purposes
  • Toll/parking/petrol for work purposes
  • Vehicle maintenance
  • Gifts to clients, meals & entertainment for clients (max 50%, apparently)
  • Utilities (also max 50%, as far as I know)

I can really use your help to update this section so its as accurate as possible. Please comment if you can add other useful info.

Data Storage

I keep all my spreadsheets, invoices, receipts, proof of payments, and important stuff in cloud storage. You can use Dropbox, Google Drive, or any other cloud storage system for this. You can even keep it in your hard disk or USB, but I always recommend cloud storage to make it easy to access and edit across different devices.

Tools for your protection


If you are working for a new customer and unsure of their payment reputation, it’s best that you prepare a contract or at least put it in black and while via emails. I know of clients who ghost on freelancers after work done, and clients who suddenly decide on a lower rate during payment time.

This is a hard section to advise, because I admit that I myself don’t use contracts for most of my clients as we have a trust system. This might be stupid of me, and I might regret it, but so far, so good. On the rare occasions that my clients don’t pay, I hound them for payment in every way I can and refuse to provide more work until the payment is done. Depending on how it plays out, I may continue or terminate that work relationship.

The thing about contracts is that yes, technically it can protect you. However, even if you take them to court, it won’t be cost-effective for you as there will be legal costs. So yes, we’re talking about protection, but recourse mechanism through contracts takes so much time, money and effort that I’m not sure it’s even worth doing if it’s for a small amount of work, for less than RM1k.

I’m not a lawyer, and I welcome any type of legal advice here to make this section stronger :/


It’s a great time to do freelancing in Malaysia. Internet is easy enough to get, so you can join the global workforce and be open to receive work from international clients as well, not just local clients. Your earning potential is virtually limitless, unlike the sad state of salaries that companies in Malaysia offer nowadays.

Do you know of any other financial tools that are helpful for freelancers in Malaysia? Do you have your own 2-cents to add? Please comment below. As always, if you find this article helpful please share it around for others to benefit.

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  1. Hey Suraya! Stumbled upon your blog, and I must say that you’re writing good content here – keep up the good work!

    One question though, I am a new freelancer receiving payments from clients via Paypal in USD (I’m a Malaysian) and yet to cash out my first pay from Paypal. Would you encourage withdrawing funds directly to a local bank account, or go by methods like VMI ATM card? (It’s confusing that some blogs are saying that PayPal doesn’t allow direct withdrawal to a Malaysian bank account, is that true?) Thanks!

    1. Hi Jenny, thanks for stopping by 🙂

      You definitely can link your Paypal account and cash out directly to local bank account. I linked it to Maybank, not sure about other banks though. Have not tried VMI ATM card (apa tu?). Transfers above RM400 is free, below that will be subjected to additional fee. Hope this helps!

      1. Hey Suraya,

        Thanks for the reply last time around 🙂 I have another question though, have you used the second PayPal option mentioned in the article (send clients your own invoice and let them send payment straight to your email address)? If so, how much are they charging you if the payment came from another country?

        I’ve recently invoiced a client and was charged a whooping 4.4% + 0.30 USD for it 🙁 Talked to PayPal support and they say it’s the rate charged to people receiving payments in Asia Pacific region.

        Thanks in advance for your reply!

        1. Hi Jenny,

          I haven’t used Paypal in a while, but if my memory serves me correctly, this was how I did it:

        2. Send client own invoice, add paypal email in there as destination address
        3. They’ll send x amount to your paypal
        4. (hazy memory) paypal might take a small amount as fees, but it shouldn’t be 4.4% (they might have revised this since last time)
        5. after that the only fee is the indirect exchange rate when withdraw to your malaysian bank
        6. If you’re trying it this way, mind reporting back the outcome? I’m curious as well 🙂

          All the best and keep hustling!

  2. “Between the two options, the second one is better UNLESS your client can absorb the fees. Then it’s pretty much equal. You’ll still subject to the indirect exchange rate fee though.”

    – Suraya, I’m not sure what you mean by this? I’ve been invoicing my client for the last 4 weeks using Paypal and nothing has shown up about paying 2.9% (or any percentage) of my earnings to Paypal. Am I missing something, or is this something they don’t actually show in the Paypal credit/debit sheet?

  3. Hi Suraya,
    i have some bitcoin, now i want withdrawl little to malaysia bank,
    is this money will kena Tax?

    1. Hi Helen,
      As I understand it, bitcoin is not recognised or regulated in Malaysia. There is no obligation to report capital gains

  4. Hi Suraya! Your blog is wonderful and fun to read, and has been helpful to me for awhile now.

    May I ask if as a sole proprietor, can we opt out business address and registration number from the invoice, leaving just the business name on it?

    1. Hi Anon,

      Thanks, that’s sweet of you to say 🙂

      On your question, it depends on the client. Some are not too fussy about the details in the invoice, some have to follow their organisation’s SOP. You can try sending invoices without it, unless the client specifically asks for it. All the best!

      1. Thank you for the reply!

        I was just worry about my own privacy and am new to this. So it is not illegal (and unlikely to cause trouble to audit if any) to opt them out, I assume?
        Thanks and have a great day!

        1. I’m not sure about legality tbh, but I’ve seen a few invoices without it. If anyone have input about this, please comment!

  5. The software used to generate the invoice here is Financio! It also comes with an integration with PayPal to improve collections from your customers.

    You can sign up for an account and enjoy a free 30 days trial. If you issue fewer than 10 invoices/mth, you may also utilize the Forever Free version!

    1. Hi, Travis from Financio! Yes you’re right – and I love how easy it is to make professional-looking invoices from Financio! Added the link in the article, and thanks for swinging by with the extra info!

  6. Hi Suraya, your blog is really help a lot! But I still confuse at some parts.

    I’m a freelancer and take job from oversea, but I never sign any contract for the company from over sea, and mostly I do freelance for personal use( like music & art).
    I have questions here, do freelancer like me need to register SSM?(it this consider as business?)
    If freelancer don’t have a SSM acc/no. how we submit the tax to LHDN?

    And I also wondering which currency to show to LHDN if I earning money in USD and EUR?

    Thank you!

  7. Hi Suraya

    Thanks for these very helpful articles. Can i know what Bitcoin wallet you use for international publishers. I’ve read your bitcoin faq but am not sure which wallet will be best at this point. hope you will be able to recommend one for me.

  8. Thank you again Suraya! Very informative as I am currently transitioning into freelance. Would love to chat with you one day about finance and other interests

    1. Welcome CJ! Join the FB/Twitter community – we chat about personal finance every day!


  9. For earning from overseas clients, I am looking into opening a Wise multi-currency account and card when they are available in Malaysia. Right now, we can only make remittances. I learned recently about the hidden fees and exchange rate markups charged by Paypal, banks and credit cards, so am keen to give Wise a try. BTW, I learned from BFM that income from overseas is not taxable, so no need to declare.

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