How to Start Homestay Business in Malaysia: Complete Guide to Stay Legal

Starting a homestay in Malaysia sounds simple — list your property on Airbnb or Booking.com, welcome guests, and earn income. But many owners soon realise the biggest challenge is not hosting — it’s navigating the rules.Each state has different requirements, local councils have their own guidelines, and ministries like MOTAC, Local Government, and Customs all play a role. In 2026, short-term rental regulations are tightening across Malaysia, with new national guidelines in their final stage of review, leaving many owners confused about:

• Do I need a licence to operate homestay?
• Which authority should I register with?
• What new rules are coming in 2026?

This guide will answer all these questions in simple, step-by-step terms, so you can start your homestay legally and confidently.

What Licences Do Homestay Owners Usually Need to Register?

If you are starting a homestay, you probably asked yourself, "Do i need to apply with SSM, PBT, or MOTAC? Or all of them?"

Here’s a complete guide to help you understand the licences you may need, step by step.

1. SSM Registration (Suruhanjaya Syarikat Malaysia)

Who needs it? 

Everyone who runs a business in Malaysia. SSM registration is what makes your business legal. Since a homestay is a business, you should register it just like any other business. Without SSM, your homestay is not legally recognised and you cannot operate officially.

How to register?

1. Go to Ezbiz Portal
2. Create an account (New User Registration)
3. Activate your account at a nearby SSM counter or kiosk
4. Complete your business registration on Ezbiz, including:
   • Business name
   • owner details
   • Business address
5. Download and keep your SSM certificate 

Tips: Do not register your business name using the word “Homestay” under SSM because it is controlled by MOTAC’s Kampung Homestay Programme. Instead, use terms like:

• Guest House
• Vacation Home
• Lodge
• Staycation
• Or simply your brand name

For more information you can refer to SSM Portal

2. PBT (Local Council) License

After registering your business with SSM, most homestay or short-term rental operators will need approval from their local council (Pihak Berkuasa Tempatan @ PBT). This is because you are running a business from a physical property, and local councils regulate business activities, zoning, and public safety within their area.

Do all homestay need a PBT license?

In many councils, the answer is yes. Homestays are treated as a business and you may be required to apply for a Business Premise Licence. However, requirements can vary by state and local council. Some councils have specific rules for short-term rentals, while others may classify them under general accommodation or tourism activities.

Because of this, it is important to check with your local councils to confirm what licence applies in your area.

Why Rules Differ Between States and Local Councils?

Each state and local council has its own zoning rules, safety requirements, tourism policies, and building management regulations. This means documents, fees, and licence categories may differ depending on your property type and location. 

For Examples: In Perak, the Ipoh City Council (MBI) has confirmed that all paid accommodation providers, including homestays, guesthouses, motels, and Airbnb-type units, must apply for a hotel licence to operate legally. This requirement applies to all “premis penginapan berbayar” under the state’s updated regulations. 

To be updated: More detailed guidance by state and local councils, including where and how to apply for licences will be shared soon. Stay tuned for updates.

Why is a PBT license important?

A PBT licence ensures that your homestay:

• Operates legally within local zoning rules
• Meets basic safety and hygiene standards
• Pays the correct local taxes or assessment (cukai pintu)
• Recognised as a registered business in your neighbourhood

Think of SSM as proof that your business exists, and the PBT licence as approval that you can operate that business from your property. 

Note: Once your homestay is officially registered and licensed, you can start listing it on Google. This makes it easier for guests to find you and increases your visibility. Check out the step-by-step guide here.

3. MOTAC Registration

Who needs it?

Only homestays that are part of the community-based village homestay programme under Cultural Tourism need to register with MOTAC.

If your property is not part of this programme, for example listings on Airbnb or Booking.com, MOTAC registration is not required. However, you must still comply with SSM and PBT requirements.

What MOTAC Registration Allows?

Once approved, MOTAC registration lets you:

• Officially market your property as a “homestay” under the program
• Offer cultural activities and local experience activities to guests
• Access to MOTAC marketing and promotional support 

How to Register:

1. Visit the official MOTAC website and find the Kampung Homestay Programme section
2. Submit your application, including property details and owner information
3. Comply with any required standards and inspections
4. Receive your official MOTAC certification once approved

What is coming in 2026 for STRA/ Homestay Owner?

• PBT Licence Will Be Mandatory
  
  • All short-term rental (STRA) and homestay operators must obtain a valid local authority (PBT) licence before registering as tourist accommodations. 08 Sept 2025
    
    
• National STRA Guidelines Are Coming (Proposed)
  
  • Updated Nov 2026: The national STRA guidelines, drafted by KPKT through PLANMalaysia with MOTAC, states and local authorities, are under final review with MOTAC. They will then be tabled to the Cabinet and the National Council for Local Government (MNKT) for approval, before states and local authorities adopt them. Read more: 26 Oct 2026
    
    
• Digital Platform Registration (Proposed)
  • Under the draft guidelines, booking platforms such as Airbnb and Booking.com are encouraged to check an operator's licence status before a listing goes live, and are expected to remove listings without a valid local authority licence.
     
• State-Specific Rules May Apply
  • Penang (in force since 1 August 2026): Short-term rental operators must hold a licence from the local authority, with annual fees and requirements on safety, cleanliness and nuisance control. On Penang Island, short-term rentals are not permitted in stratified residential properties. Non-compliance may lead to fines, imprisonment or closure.
  • Selangor plans to limit homestays and STRA units to 180 nights per year starting 2026. 23 Nov 2025 
    

    A similar cap is being considered at national level but is not confirmed. Please check the latest position with your local authority.

  • Local councils may also set different licence fees, operational limits, or inspection requirements. 
    
    

• Strata Properties Must Follow Building By-Laws
  
  • If your unit is in a strata property, short-term rental must also comply with the by-laws of your Joint Management Body (JMB) or Management Corporation (MC) under the Strata Management Act 2013. Some buildings restrict or prohibit short-term rentals.

Note: Some of the rules mentioned above are still proposals and have not been officially confirmed yet. Regulations may change as the national STRA guidelines are finalized and adopted by local authorities. Requirements differ by state and local authority. Please confirm the rules that apply to your premises with your local PBT before operating.

Conclusion

Starting a homestay in Malaysia is a great opportunity, but it also comes with legal responsibilities. As the industry becomes more regulated, SSM registration, PBT licensing, and compliance with future national STRA guidelines will become more important, especially as we approach 2026.

While some rules are already confirmed, others are still being developed by MOTAC, KPKT, and local councils. Requirements can vary by state, so it is always essential to check with your local PBT before operating.

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