2012 budget commentary
TRANSCRIPT
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2012 BUDGET HIGHLIGHTS7 October 2011
Executive Summary
Double deduction is given on expenses incurred in implementing structured internshipprogrammes, in participating in approved overseas career fairs and in awarding scholarships to
Malaysian students.
Tax deduction is given on franchise fees paid for local franchise brands. Late tax refunds by the Inland Revenue Board are subject to compensation of 2%. Tax audit time bar is reduced from 6 years to 5 years from the date of assessment except for cases
of false declaration, wilful late payment and negligence. Records shall continue to be kept for 7
years.
Tax deduction is given for expenses incurred on the issuance of Islamic securities based on theWakalah principle approved by Securities Commission (SC) or Labuan Financial Services Authority
(LFSA).
Existing tax exemptions for the issuance and trading of non-Ringgit Malaysia sukuks originatingfrom Malaysia are extended to Year of Assessment (YA) 2014.
70% tax exemption on statutory income for 5 years is given to an approved Treasury ManagementCentre providing qualifying treasury services to its related companies.
100% income tax exemption for 10 years for Kuala Lumpur International Financial District statuscompanies.
Pioneer status or investment tax allowance is accorded to investors undertaking new investmentsin 4 and 5 star hotels in Peninsular Malaysia, providers of industrial design services and private
schools and international schools registered with the Ministry of Education.
Extension of 100% import duty and excise duty exemption for new completely-built-up hybrid andelectric cars to 31 December 2013.
Tax exemption under Section 54A of the Income Tax Act, 1967 (the Act) for shipping companies isreduced from 100% to 70% of statutory income.
Tax relief of up to RM3,000 for contributions by individuals to SC approved Private RetirementSchemes.
Real Property Gains Tax at the revised rate of 10% is imposed on disposals within 2 years ofacquisition.
100% stamp duty exemption is given on loan agreements for the purchase of residential propertiespriced up to RM300,000 under the Skim Perumahan Rakyat 1Malaysia.
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2012 BUDGET HIGHLIGHTS7 October 2011
Overview and CommentaryThe Prime Minister, YAB Dato Sri Mohd. Najib Tun Abdul Razak, tabled the 2012 Budget on Friday, 7
October 2011.
The theme of the 2012 Budget National Transformation Policy: Welfare for the Rakyat, Well-Being of
the Nation, reflects the Governments focus on enhancing the welfare of the rakyat and the journey to
become a developed and high-income nation.
For the 2012 Budget, an amount of RM181.6 billion has been allocated for operating expenditure whilst
for development expenditure, the amount allocated is RM51.2 billion. On the revenue side, the Federal
Government is expected to generate an amount of RM186.9 billion. Taking into account, the estimated
revenue and expenditure, the Federal Government deficit in 2012 is expected to improve to 4.7% ofGDP compared with 5.4% in 2011.
To further support economic growth, the Government will implement a Special Stimulus Package
through Private Financing Initiatives. In 2012, total projects amounting to RM6 billion will be
implemented through the Special Stimulus Package and several public projects will be implemented to
stimulate the economy and enhance the well-being of the rakyat.
The five main focus areas of the Budget are:
Accelerating investment; Generating human capital excellence, creativity and innovation; Rural transformation programme; Strengthening the civil service; and Easing inflation and enhancing the well-being of the rakyat.The following are some of the more notable proposed changes in the 2012 Budget:
Real Property Gains Tax (RPGT)
In order to curb speculative activities, the RPGT rate has been revised such that chargeable assets
disposed of within a period of 2 years from acquisition will be subject to RPGT at the rate of 10% whilst
disposals within 2-5 years will be subject to RPGT at the rate of 5%. Disposals of assets held after 5
years remain exempt from RPGT. This is effective for disposal of properties commencing from 1
January 2012.
Compensation for Late Refund of Income Tax by the Inland Revenue Board (IRB)
As a measure to improve efficiency and to expedite the repayment of tax overpaid by taxpayers, it has
been proposed that with effect from YA 2013, taxpayers will be given compensation of 2% on the
amount of tax refunded late by the IRB.
Development of the Kuala Lumpur International Financial District (KLIFD)
To accelerate the development of the KLIFD, the Government has proposed a range of tax incentives
including income tax exemptions for property developers in KLIFD as well as companies with KLIFD
status.
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2012 BUDGET HIGHLIGHTS7 October 2011
Tax Incentive for Treasury Management Centre (TMC)
To supplement the Governments efforts to develop Malaysia as a competitive financial centre in the
region, a range of tax incentives including 70% tax exemption on statutory income and withholding tax
exemption on interest have been proposed to encourage the establishment of TMC in Malaysia. This is
effective for applications received by the Malaysian Investment Development Authority (MIDA) from 8
October 2011 until 31 December 2016.
The other key changes are outlined in the following pages.
Khoo Chin Guan
Executive Director Head of Tax
KPMG Tax Services Sdn Bhd
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
CORPORATE TAX
Internship
Programme
Currently, expenses incurred by a company that provides practical training
including an internship programme are eligible for a tax deduction.
To encourage further companies participation in internship programmes, it is
proposed that a double deduction be given on expenses incurred by
companies that implement the structured internship programme (which
includes technical, communication and business skills) that is jointly
developed by the Ministry of Higher Education and Talent Corporation
Malaysia Berhad. The qualifying criteria are, amongst other things, as
follows:
i. The internship programme is for full time undergraduate students fromthe Public/Private Higher Educational Institutions; and
ii. The internship programme is for a minimum period of 10 weeks with amonthly allowance of at least RM500.
The proposal is effective from YA 2012 to YA 2016.
Scholarship
Awards
At present, scholarships paid by companies directly to students qualify for
single tax deductions.
To encourage further the development of human capital, it is proposed that
companies providing scholarships directly to students be given double
deductions provided:-
i. the course of study must lead to a diploma, or degree or the equivalentof a diploma or degree undertaken at a higher educational institution
established or registered under the laws regulating such establishment
or registration in Malaysia or authorised by any order made under the
Universities and University Colleges Act, 1971;
ii. the scholarships are granted to full-time students enrolled in the abovelocal institutions of higher learning;
iii. the student has no means of his own; andiv. the total monthly income of the parents or guardians of the student
does not exceed RM5,000.
The scholarship is limited to payments required by such higher educational
institution relating to the course of study and educational aids, as well as
reasonable cost of living expenses during the students period of study at the
higher educational institution.
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
The proposal is effective from YA 2012 to YA 2016.
Career Fairs Abroad The private sector is recognised as being a key contributor towards
strengthening the development of highly-skilled human capital. To support
this endeavour, it is proposed that expenses incurred by companies for
participating in career fairs abroad that are endorsed by Talent Corporation
Malaysia Berhad, be given a double tax deduction.
The proposal is effective from YA 2012 to YA 2016.
Franchise Fees To develop further a local product brand for domestic and international
markets, it is proposed that a tax deduction be given on franchise fees paid
for local franchise brands.
The proposal is effective from YA 2012.
Time Bar for Audit Based on the current Tax Audit Framework, a tax audit may cover a period of
one to three YAs. However, the audit may be extended up to 6 YAs.
It is proposed that the time bar for tax audits be reduced from 6 to 5 years.
However, the proposal will not alter the requirement to keep records for 7
years from the end of the year to which any income from the businessrelates and for the purposes of ascertaining a persons chargeable income
and tax payable.
Notwithstanding the above, the Finance Bill does not contain a provision
amending the limitation period in the Act. It therefore remains to be seen
what the intention of this proposal is.
The proposal is effective from YA 2013.
Payment to Agent
etc
It is proposed that every company must prepare and provide to each of its
agents, dealers or distributors, who receives payment (whether in monetary
form or otherwise) arising from sales, transactions or schemes, a prescribed
form containing particulars of payment, name and address of the agent,
dealer or distributor and other particulars which may be required by the
Director General of the IRB. The prescribed form must be provided on or
before 31 March of the following year. The company must retain the
prescribed form in its safe custody and make it readily available to the IRB
upon request.
The proposal is effective from 1 January 2012.
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
Insurance
Companies - Losses
It is proposed that only the adjusted loss from a life fund for a YA is allowed
to be deducted against the statutory income of the life fund of the insurer for
subsequent YAs until it is fully utilized. Prior to the above proposed
amendment, any unabsorbed business loss from the business of a life fund
and other business of an insurer are allowed to be set-off against the
statutory income of the life fund of the insurer.
It is also proposed that the adjusted loss from the business of a life fund of
an insurer for a YA is not allowed to be deducted against the aggregate of
statutory income from other sources other than the life fund for the relevantYA. Any unabsorbed business loss from sources other than a life fund for
the relevant YA are not allowed to be deducted against the statutory income
of the life fund of that insurer for subsequent YAs.
The proposal is effective from YA 2012.
CAPITAL MARKETS
Real Estate
Investment Trusts
(REITs)
Currently, income of a REIT which is exempt under Section 61A of the Act
and distributed to unit holders is subject to the following final withholding
tax:
i. foreign institutional investors which include pension funds and collectiveinvestment schemes at the rate of 10% from 1 January 2009 to 31
December 2011;
ii. non-corporate investors which include resident individuals, non-residentindividuals and other local non-corporate entities at the rate of 10%
from 1 January 2009 to 31 December 2011; and
iii. nonresident companies at the rate of 25%.To promote further the development of REITs in Malaysia, it is proposed that
the concessionary tax treatment in paragraphs (i) and (ii) above be extendedfor another 5 years from 1 January 2012 to 31 December 2016.
Islamic Securities To promote the growth of the Islamic capital market and to strengthen
Malaysias position as the leader in the global sukuk market, it is proposed
that a tax deduction be given on expenses incurred on the issuance of
Islamic securities based on the Wakalah principle. The issuance of such
sukuk must be approved by the SC or LFSA.
The proposal is effective from YA 2012 to YA 2015.
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
Trading of Non-
Ringgit Sukuks
Currently a tax exemption is given on the following from YA 2009 to
YA 2011: -
i. income received by qualified institutions or persons in undertakingactivities related to the arranging, underwriting and distribution of non-
ringgit sukuk originating from Malaysia; and
ii. income of qualified institutions received from the trading of non-ringgitsukuk originating from Malaysia.
To promote further Malaysia as an international hub for Islamic bond
markets, it is proposed that the above tax exemptions be extended for
another 3 years from YA 2012 to YA 2014.
Treasury
Management
Centre
TMC is a centre that provides financial and fund management services to a
group of related companies within or outside the country. To develop
Malaysia as a competitive financial centre in this region and to promote the
establishment of TMCs in Malaysia, it is proposed that a TMC in Malaysia be
given the following incentive package:-
i. 70% tax exemption on the statutory income arising from the qualifyingservices rendered by the TMC to its related companies for a period of 5
years;
ii. exemption from withholding tax on interest payments on borrowings bythe TMC to overseas banks and related companies, provided the funds
raised are used for the conduct of qualifying services;
iii. full exemption from stamp duty on all loan agreements and serviceagreements executed by the TMC in Malaysia for qualifying services;
and
iv. expatriates working in the TMC are taxed only on the portion of theirchargeable income attributable to the number of days they are in
Malaysia.
The qualifying services of a TMC include cash management, current account
management, financial and debt management, investment services, financial
risk management, and corporate and financial advisory services.
The proposal is effective for applications received by MIDA from 8 October
2011 until 31 December 2016.
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
TAX INCENTIVES
New 4 and 5 Star
Hotels
Presently, tax incentives are given to new 4 and 5 star hotels in Sabah and
Sarawak only. To continuously encourage the development of new 4 and 5
star hotels and to provide better accommodation facilities to attract high-
spending tourists, it is proposed that the following tax incentives be given to
investors undertaking new investments in such hotels in Peninsular
Malaysia:-
i. Pioneer Status with income tax exemption of 70% of statutory incomefor 5 years; or
ii. Investment Tax allowance of 60% on the qualifying capital expenditureincurred within a period of 5 years and to be set-off against 70% of the
statutory income for each YA
The proposal is effective for applications received by MIDA from 8 October
2011 until 31 December 2013.
Hybrid and Electric
Cars
To support further Malaysias commitment to the reduction of carbon
monoxide emissions, it is proposed that the full exemption of import duty
and excise duty for new completely built-up (CBU) hybrid cars and electriccars be extended for another two years. The aforementioned is subject to
certain criteria and conditions set for hybrid cars and electric cars.
The proposal is effective for applications received by the Ministry of Finance
(MOF) from 1 January 2012 until 31 December 2013.
Industrial Design
Services
Currently, there is no tax incentive for providers of industrial design services.
As a means to encourage creativity and innovation in industrial designing
with the aim of improving productivity, quality and product competitiveness,
it is proposed that providers of industrial design services be given Pioneer
Status with income tax exemption of 70% on statutory income for 5 years,
provided the following criteria are met:-
i. new service providers who employ at least 50% Malaysian designers;or
ii. existing industrial design service providers undertaking expansion andnon-industrial design service providers which would be carrying out
industrial design activities:
a. upgrade the design facilities by increasing the capital investment ofat least 50%; and
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
b. employ an additional 50% qualified Malaysian designers.In addition, the above incentive is subject to the following conditions:
i. industrial design service providers and Malaysian designers must beregistered with the Malaysia Design Council;
ii. industrial design service providers must be incorporated under theCompanies Act 1965 or registered under the Business Registration Act
1956 and shall provide industrial design services to non-related
companies; and
iii. industrial design services provided are meant for the purpose of massproduction.
The proposal is effective for applications received by MIDA from 8 October
2011 until 31 December 2016.
Shipping
Companies
Presently, the statutory income of a resident person who carries on the
business of transporting passengers or cargo by sea on a Malaysian ship or
letting out on charter a Malaysian ship owned by him on a voyage or time
charter basis is wholly exempt from tax.
It is proposed that the statutory income of that person from each Malaysian
ship is to be treated as income from a separate business source and the
income tax exemption is reduced from 100% to 70% of the statutory
income. The balance of 30% of the statutory income is deemed to be the
total income of that person and is subject to tax. Any adjusted loss for a YA
in respect of a source consisting of a Malaysian ship shall not be deductible
in arriving at the total income of that person for that YA and shall be carried
forward to reduce the exempt statutory income of that person from the
same source in the subsequent YAs, until the adjusted loss is fully utilised.
A Malaysian ship means a sea-going ship registered as such under theMerchant Shipping Ordinance 1952, other than a ferry, barge, tug-boat,
supply vessel, crew boat, lighter, dredger, fishing boat or other similar
vessel.
The proposal is effective from YA 2012.
Private Schools To encourage further the involvement of the private sector in providing
quality educational services, it is proposed that tax incentive be given to
private schools and international schools registered and fulfilling the
requirements stipulated by the Ministry of Education as follows:
i. Profit Oriented Private Schools
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
income tax exemption of 70% for a period of 5 years; or Investment Tax Allowance (ITA) of 100 % on the qualifying capital
expenditure incurred within a period of 5 years. The allowance
claimed is eligible to be set-off against 70% of the statutory
income for each YA.
ii. Profit Oriented International Schools income tax exemption of 70% for a period of 5 years;
iii. Profit Oriented Private Schools and International Schoolsa. import duty and sales tax exemption for educational equipment;
and
b. double deduction for overseas promotional expenses.The proposals are effective as follows:
i. Profit Oriented Private Schools for applications received by MIDA from 8 October 2011 until 31
December 2015.
ii. Profit Oriented International Schools for applications received by MIDA from 8 October 2011 until 31
December 2015.
iii. Profit Oriented Private Schools and International Schoolsa. for applications received by MIDA from 8 October 2011; andb. from YA 2012.
Kuala Lumpur
International
Financial District
Kuala Lumpur International Financial District (KLIFD) sits on 75 acres of land
situated in between Jalan Tun Razak, Jalan Sultan Ismail and the Putrajaya
elevated highway, which is strategically located at the southern tip of Kuala
Lumpur city.
To achieve the KLIFDs aspiration as a global financial city of choice and to
attract leading financial organisations to operate in the KLIFD, the following
incentive package is proposed:
i. 100% income tax exemption for a period of 10 years and stamp dutyexemption on loan and service agreements for KLIFD status companies;
ii. Industrial Building Allowance and Accelerated Capital Allowance forKLIFD Marquee status companies; and
iii. 70% income tax exemption for a period of 5 years for property
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
developers in KLIFD.
Currently, details of the application process have not been released.
Reinvestment
Allowance
i. Currently, reinvestment allowance of 60% of capital expenditureincurred for a qualifying project can be utilised against 100% of
statutory income for each YA provided that the qualifying project has
achieved the level of productivity as prescribed by the Minister or is
located within the promoted areas such as Sabah, Sarawak, Labuan,
Eastern Corridor of Peninsular Malaysia and other areas determined bythe Minister.
It is proposed that the utilisation of reinvestment allowance against
100% of statutory income be limited to only qualifying projects which
have achieved the level of productivity as prescribed by the Minister.
Thus, companies within the abovementioned promoted areas which
have incurred capital expenditure on qualifying projects can now only
utilise the reinvestment allowance against 70% of their statutory
income with the new amendment.
ii. Currently, there is no definition of factory in Schedule 7A of the Act.It is now proposed that the definition of factory be included in
Schedule 7A of the Act. A factory is defined as the portion of the
floor areas of a building or an extension of a building used for the
purposes of qualifying project to place or install plant or machinery or to
store any raw material, goods and/or materials manufactured provided
that the storage of raw material, goods and/or materials does not
exceed one-tenth of the total floor areas of that building or extension of
the building.
It may be difficult in practice to ascertain the floor areas for the purpose
of this definition especially where the floor areas used as storage are
not clearly designated due to the constant movement of these items.
Measures have also been proposed to deny the taxpayer the ability to
claim reinvestment allowances when the taxpayer has been granted
investment tax allowance or investment tax credit.
The proposal is effective from YA 2012.
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
INDIRECT TAX
Budget Taxis and
Hire Cars
Currently, owners of budget taxis and hire cars are given 100% excise duty
exemption on the purchase of new locally manufactured cars used as budget
taxis and new locally assembled cars used as hire cars.
Excise duty is payable based on the value when the car is sold or the
ownership is transferred. Road tax on these cars is at RM20 per annum.
To assist individual budget taxi and hire car owners in lowering their cost of
operations and to improve services, it is proposed that the following begiven:
i. 100% sales tax exemption on the purchase of new locally manufacturedcars used as budget taxis or hire cars;
ii. excise duty and sales tax exemptions when budget taxis or hire cars aresold or the ownership is transferred after 7 years of registration;
iii. road tax on budget taxis and hire cars to be abolished;iv. interest rate subsidy of 2% per annum for 2 years on full loans for
financing the purchase of new locally manufactured cars used as budget
taxis and hire cars; and
v. assistance of RM3,000 for replacement of budget taxis and hire carsaged more than 7 years but less than 10 years and assistance of
RM1,000 for budget taxis and hire cars aged more than 10 years and
above. This assistance is granted for the purchase of new locally made
cars.
The proposals for (i) and (ii) are effective from 8 October 2011. Proposal (iii) is
effective from 1 January 2012. Proposals (iv) and (v) are effective from 1
January 2012 to 31 December 2013.
PERSONAL TAX
Enhancing Tax
Compliance
To enhance further the e-Filing system for salaried taxpayers, it is proposed
that information such as total income, Monthly Tax Deductions (MTD) and
employees contribution to the Employees Provident Fund (EPF) be pre-
filled by the IRB based on information provided by employers. This should
reduce the time spent by individuals in completing their e-Filing.
The proposal is effective from YA 2012.
Retirement
Schemes
To promote sufficient savings of individuals upon attaining retirement age, it
is proposed that for resident individuals:
i. a separate tax relief of RM3,000 be given for contributions made to
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
Private Retirement Schemes (PRS) approved by the SC and for deferred
annuity premium.
ii. the existing tax relief on EPF contributions and life insurance of up toRM6,000 will not include premiums for deferred annuity.
The proposal is effective from YA 2012 to 2021.
The following have also been proposed:
i. contributions by employers to PRS will be deductible up to 19% ofemployees remuneration which include contributions to EPF and otherapproved schemes.
ii. tax exemption is granted on income received by a PRS fund.iii. withdrawals of contributions from PRS by an individual prior to maturity
or prior to attaining the mandatory retirement age are taxable.
Returning Expert
Programme
It is proposed that the employment income of an approved individual under
the Returning Expert Programme will be taxed at the flat rate of 15% for a
specified period. This is one of the tax benefits offered to returning experts
with the view to attract, facilitate and retain aspiring Malaysian returnees.
Based on TalentCorps website, the individuals could opt to be taxed underthe scale rates instead of 15% and the specified period is 5 years.
The proposal is effective from YA 2012.
MISCELLANEOUS
Review of Real
Property Gains Tax
To curb speculative activities in the real property market so as to ensure that
the low and middle income groups are able to own houses at affordable
prices, it is proposed that the RPGT rates on gains arising from the disposal
of residential and commercial properties be reviewed as follows:
i. 10% tax where the property has been held for up to 2 years;ii. 5% tax where the property has been held for more than 2 years and up
to 5 years; and
iii. 0% tax where the property has been held for more than 5 years.The proposal is effective for disposals from 1 January 2012 onwards.
Stamp Duty on
Loans
To increase ownership by the middle income group of residential properties
and to reduce the cost of doing business for micro enterprises and small and
medium enterprises (SMEs), it is proposed that a 100% stamp duty
exemption be given on the following instruments:-
i. loan agreements for the purchase of residential properties priced up to
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
RM300,000, under the Skim Perumahan Rakyat 1Malaysia;
ii. loan agreements entered into between micro enterprises and SMEswith any banking and financial institution for loans up to RM50,000
under the Micro Financing Scheme; and
iii. loan agreements entered into between any professionals and BankSimpanan Nasional for loans up to RM50,000 under the Professional
Services Fund.
With respect to item i, the proposal is effective for sale and purchase
agreements executed between 1 January 2012 to 31 December 2016.
With respect to items ii and iii, the proposal is effective for agreements
executed from 1 January 2012.
Compensation For
Late Refunds
Currently, taxpayers who are late in paying their taxes are subject to
penalties.
However, no compensation is given to the taxpayer if the IRB is late in
refunding any tax overpaid.
In order to ensure that taxpayers are accorded equitable treatment and to
enhance efficiency in the tax administration, it is proposed that taxpayers begiven compensation of 2% per annum on the amount of tax refunded late by
the IRB.
A refund is considered late if it is made after :-
i. 90 days from the due date for e-filing; orii. 120 days from the due date for manual tax filingThe compensation of 2% is to be paid based on the following formula:
A x B x 2%
C
Where A is the amount refunded under Section 111 for a YA;
B is the number of days beginning from the first day after the period
of :-
i. 90 days from the due date for e-filing; orii.120 days from the due date for manual tax filing, until the day that
amount is made to a person; and
C is the number of days in a year.
Where the refund ought not to have been made by reason of an incorrect
return or incorrect information as furnished by the taxpayer, a 10% penalty
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2012 BUDGET HIGHLIGHTS7 October 2011
SUBJECT BUDGET PROPOSALS
would apply on the amount wrongly refunded.
The above compensation shall not apply if the taxpayer fails to furnish the tax
return in accordance with the Act, if the excess payment is due to tax set off
under Section 110 or the assessment is under appeal.
The proposal is effective from YA 2013.
Power of Access To allow the IRB to have a wider scope of review in carrying out tax audits
and investigations, it is proposed that the Director General be empowered to
have access to computerised data stored in a computer including being
provided with the necessary password, encryption code, decryption code,
software or hardware and any other means required to enable
comprehension of the computerised data.
The proposal is effective from 1 January 2012.
In addition it is also proposed that the existing provision of the Act covering
the power to call for information be extended. The Director General is to be
empowered to request any person to provide any information or document
under his control or possession within or outside the territorial jurisdiction of
Malaysia. Further, the Director General is given the power to wholly or partlydisregard any information or particulars produced after the expiry of the time
specified in a notice issued by them. The information or particulars
disregarded shall not be used to dispute the assessment made under the Act
including in any proceeding before the SC or court.
The proposals are effective on the coming into operation of the Finance Act.
Advance
Instalments of Tax
It is proposed that the Director General may direct a person to make
payments by instalments for a YA on account of tax which may be payable
where the person fails to furnish a return under the Act or he has reason to
believe that the person has submitted an incorrect return by omitting orunderstating any income or gives incorrect information in regards to his
chargeability to tax. The direction may be issued to the person before the
making of an assessment or composite assessment under the Act. The
person can apply to the Director General for a variation of the amount or
number of instalments within 30 days after the service of such direction.
The proposal is effective on the coming into operation of the Finance Act.
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Contact us
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8, First Avenue, Bandar Utama
47800 Petaling Jaya
Selangor, Malaysia
Phone: +60 (3) 7721 3388
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www.kpmg.com.my
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