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Deloitte Tax Espresso - September 2013
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Malaysia Tax
Quick links: Deloitte Malaysia Inland Revenue Board
Takeaways: Accelerated capital allowance for plant and machinery used for the manufacture of promoted products
Events/seminars: Tax and Transfer Pricing Audit 13 September 2013 9.00 am–12.30 pm with Japanese translation 1.30 pm-5.00 pm Contact Ingrid 03-7712 5136 GST Workshop: Manufacturing & Exports 18 September 2013 Contact Audrey 03-7725 7765 or Noorashikin 03-7712 5138 Global Employer Services Seminar 19 September 2013 Contact Zakiah 03-7712 5295
Important deadlines: Due date for 2013 tax estimates for companies with October year-end (1 October 2013)
6th month revision of tax estimates for companies with March year-end
Tax Espresso
9/2013 September 2013
Tax developments
Accelerated capital allowance for plant and machinery incurred in manufacturing promoted
products
Malaysian Investment Development Authority (MIDA) has issued a guideline on the procedure for
applying for a confirmation letter to support a claim for accelerated capital allowance by the
company. The following procedure / conditions will apply:
(a) Application is to be made to MIDA after the completion of the 15-year period of eligibility for
reinvestment allowance.
(b) The company is involved in the business of manufacturing promoted products.
(c) The company reinvests in plant and machinery.
(d) Two copies of the completed form ACA-Application for Confirmation Letter for a Company
which Manufactures Promoted Products under the Promotion of Investments Act 1986 are to
be submitted to MIDA together with a copy of the Memorandum and Articles of Association,
Certificate of Incorporation (Form 9) and Registered Address (Form 44) of the company.
With the letter from MIDA confirming that the company carries on a business of manufacturing
promoted products as determined under the Promotion of Investments Act 1986, the company can
claim accelerated capital allowance as follows:
Initial allowance – 40%
Annual allowance – 20%
Guidelines on particulars of payments to agents, dealers or distributors (Form CP58) -
Addendum
The Inland Revenue Board Malaysia (IRBM) has issued an addendum to clarify that the following
payments to agents, dealers or distributors are not considered as incentives to be included in the
Form CP58:
(a) Appreciation Night held in Malaysia for agents, dealers or distributors who have achieved a
9th month revision of tax estimates for companies with December year-end
Statutory filing of 2013 tax returns for companies with February year-end
target – dinner, entertainment and accommodation.
(b) Dinner or entertainment held in Malaysia for company anniversary or religious or cultural
festivals such as Hari Raya Aidilfitri, Chinese New Year, Deepavali or Christmas.
(c) Convention that includes leadership training, management training and other activities for the
purpose of increasing sales held in Malaysia (excluding a travel package in Malaysia that has
been considered as a non-cash incentive)
Taxation of Business Trust (Public Ruling No. 10/2013)
The IRBM has issued Public Ruling No. 10/2013 on Taxation of Business Trust to explain the tax
treatment accorded to a business trust which is registered with Securities Commission Malaysia.
A “business trust” means a unit trust scheme where the operation or management of the scheme
and the scheme’s property or asset is managed by a trustee-manager. The trustee-manager holds
legal ownership of assets as a trustee and also manages the business of the trust as its operator.
The business trust is given the same tax treatment as a company such as:
(a) Residence status – control and management of the business trust is exercised in Malaysia.
(b) Basis period – Financial accounting period of 12-months is the basis period.
(c) Controlled transfer of plant and machinery between related business trusts.
(d) Group relief – transfer of losses from surrendering entity to claimant entity.
(e) Tax incentives under the Income Tax Act 1967, Rules and Orders.
The business trust is not eligible for the following preferential tax treatment which is accorded to a
company:
(a) A business trust with a unit capital of not more than RM2.5 million is required to submit an
estimate of tax payable within 3 months from the date of commencement of its operations.
(b) The preferential tax rate of 20% does not apply to a business trust.
(c) Special allowance for small value assets does not apply to a business trust.
For tax enquiries, email or call:
Business Tax
Compliance & Advisory
Yee Wing Peng (603) 7712 5250
Alex Wong (605) 255 5358
Ng Lan Kheng (604) 228 8255
Financial Services
Chee Pei Pei (603) 7712 5132
International Tax
K Sandra Segaran (603) 7712 5142
Mergers & Acquisitions
Sim Kwang Gek (603) 7712 5134
Oil & Gas
Tan Hooi Beng (603) 7712 5122
R&D and Government Incentives
Daniel Lim (603) 7712 5139
Real Estate
Tham Lih Jiun (603) 7712 3899
Tax Audit & Investigation
Chow Kuo Seng (603) 7712 5137
Global Employer Services
Ang Weina (603) 7712 5143
Indirect Tax
Fan Kah Seong (603) 7712 5105
Tan Eng Yew (603) 7712 5164
Robert Tsang (+65) 6530 5523
Transfer Pricing
Theresa Goh (603) 7712 5135
Level 19, Uptown 1
1, Jalan SS21/58, Damansara Uptown
47400 Petaling Jaya, Selangor
Malaysia
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© 2013 Deloitte KassimChan Tax Services Sdn Bhd
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