Malaysia Tax

Quick links:
Deloitte Malaysia Inland Revenue Board

Tax Espresso
9/2013 September 2013

Takeaways:
Accelerated capital allowance for plant and machinery used for the manufacture of promoted products

Tax developments
Accelerated capital allowance for plant and machinery incurred in manufacturing promoted products

Events/seminars:
Tax and Transfer Pricing Audit 13 September 2013 9.00 am12.30 pm with Japanese translation 1.30 pm-5.00 pm Contact Ingrid 037712 5136 GST Workshop: Manufacturing & Exports 18 September 2013 Contact Audrey 03-7725 7765 or Noorashikin 037712 5138 Global Employer Services Seminar 19 September 2013 Contact Zakiah 03-7712 5295

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%

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

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 yearend 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 schemes 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 Alex Wong Ng Lan Kheng Financial Services Chee Pei Pei (603) 7712 5132 (603) 7712 5250 (605) 255 5358 (604) 228 8255

International Tax K Sandra Segaran Mergers & Acquisitions Sim Kwang Gek Oil & Gas Tan Hooi Beng (603) 7712 5122 (603) 7712 5134 (603) 7712 5142

R&D and Government Incentives Daniel Lim Real Estate Tham Lih Jiun Tax Audit & Investigation Chow Kuo Seng Global Employer Services Ang Weina Indirect Tax Fan Kah Seong Tan Eng Yew Robert Tsang Transfer Pricing Theresa Goh (603) 7712 5135 (603) 7712 5105 (603) 7712 5164 (+65) 6530 5523 (603) 7712 5143 (603) 7712 5137 (603) 7712 3899 (603) 7712 5139

Level 19, Uptown 1 1, Jalan SS21/58, Damansara Uptown 47400 Petaling Jaya, Selangor Malaysia Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/my/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte has in the region of 200,000 professionals, all committed to becoming the standard of excellence. This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the Deloitte Network) is, by means of this publication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person

who relies on this publication. 2013 Deloitte KassimChan Tax Services Sdn Bhd Deloitte Malaysia | Add Deloitte as a safe sender To no longer receive emails about this topic please send a return email to the sender with the word Unsubscribe in the subject line