Tutorial 13 (Week 14)

Zi Hong, Zhi Ken, Wan Tien

 RM Since the assessment for that year has
underestimated of the instalments
Tax Payable (actual) 80,000
payable with > 30 % difference.
Less: instalment (40,000)
The amount of the difference which
Net Tax Payable 40,000 exceeds 30 % of the tax payable shall be
increased by a sum equal to 10 %
30% of actual tax payable 24,000 (RM16,000*10%)of that amount of
difference, and that sum shall be
Excess subject to a penalty 16,000
recoverable as if it were tax due and
10% penalty payable (16,000*10%) 1,600 payable under this Act. ss107B(3)
Question 2
Riang Sdn Bhd (Riang), a tax resident company, has been in operation for many years and closes its
accounts on 31 January annually. Riang’s tax estimates for the years of assessment 2021 and 2022 were
RM320,000 and RM600,000 respectively. The final tax payable for the year of assessment 2022 was
RM980,000.

Required:

In respect of Riang Sdn Bhd for the year of assessment 2022:

(a) State and explain the due date of submission for its tax return. (2 marks)

Basis period for the YA 2022 is form 1/2/2021-31/1/2022.Company must submit tax return to IBR within 7
months after the reporting period.Tax return for YA 2022 is to be filed by 31 august 2022

(b) State and explain the date by which it should furnish its initial tax estimate. (2 marks)

The date of furnish its initial tax estimate will be 1 Jan 2021 (30 days before 1/2/2021).Because the
prescribed form and furnished to the DG not later than 30 days BEFORE the beginning of the basis period for
that year of assessment.
(c) State and explain the minimum amount of estimate it must furnish. (2 marks)

Rm320,000*85%=Rm272,000.The estimate of tax payable for a year of assessment shall not be

less than 85% of the revised estimate of tax payable for the immediately preceding year of
assessment

(d) State when the tax estimate may be revised. (2 marks)

The tax revised estimate can be made in july or october 2021 or both.There will be 6th month or the
9th month, or in both months of the basis period for a year of assessment furnish to the DG a
revised estimate of its tax payable for that year in the prescribed form

(e) Compute the final tax payable and the under-estimation penalty, if any. (2 marks)

under-estimation penalty=980000- 600000 = 380,000 -(980000*30%)=Rm86000 (RM8,600)

The final tax payable will be RM(980,000+86000*10%)=Rm988600

 RM

Tax Payable (actual) 980,000

Less: instalment (600,000)

Net Tax Payable 380,000

30% of actual tax payable 294,000

Excess subject to a penalty 86,000

10% penalty payable (86,000*10%) 8,600

The final tax payable = RM380,000 + RM8,600 = RM388,600

(a) When is the company required to pay its estimated income tax payable for the year of assessment
2022?
The company should pay its estimated income tax payable for YA 2022 in equal monthly
instalments by the due date beginning from the second month of the basic period which is June
2021.

(b) Is it possible for the company to revise its estimates where the directors found that the company’s tax
payable for the YA 2022 is about RM15,100?
Yes. The company can revise its estimate of tax payable in the 6th month (October 2021) or the
9th month (January 2022) or in both months of the basis period for the YA 2022 (1 May 2021 -
30 April 2022).
(c) If the company has made its monthly tax payment of RM500 each for the months from June 2021
to October 2021, how should the balance of RM12,600 be paid to the Tax Collector if the company
revised its estimates in the sixth month of the basis period for YA 2022.
A monthly tax instalment of RM1,800 (RM12,600/7) will be paid from November 2021 to May
2022.

(d) When the company submits its income tax return form on 30 November 2022, the tax payable
computed is RM20,000, is there any penalty to be imposed on the difference?
No penalty will be imposed on the difference because the estimated tax payable for YA 2022 does
not exceed 30% of the tax payable under the assessment. The workings are shown as below:

Tax payable (actual) RM20,000

Less: instalment (RM15,100)
Net tax payable RM4,900 → 24.5% (4,900/20,000)

30% of actual tax payable RM6,000

Excess subject to a penalty of 10% Nil
(e) When must the company settle its balance of tax payable of RM4,900 to the Tax
collector?
The company must settle its balance of tax payable of RM4,900 due on or before 30
November 2022 which is within 7 months after the close of the accounting period at
April 2022.

(f) Should the company continue paying the balance of its tax payable for YA 2022,
assuming that the estimates furnished in (b) above is RM2,000 instead of RM15,100?
No. Since the total amount of instalments which is payable in YA 2022 prior to that
revised estimate (RM2,500) exceeds the revised estimate (RM2,000), the remaining
instalments shall cease immediately.
Tutorial 12 (This Week)
Kin Wai, Ruo Yin, Sek Ying
(a) Main ans:
The Malaysian self-assessment system is a tax compliance regime where taxpayers are responsible for
computing and paying their own taxes. Taxpayers are required to file their own tax returns and pay
their own taxes based on their own calculations. The Malaysian Income Tax Act imposes certain
obligations on individuals with respect to their tax affairs.

Responsibility of individual tax payer:

An individual who arrives in Malaysia must give notice of chargeability to the Director General of Inland
Revenue (DGIR) within two months of arrival.

Individuals with employment income or business income for a basis year must furnish a return by 30 April
or 30 June of the following year, respectively.

Individuals must inform the DGIR of any change of address within three months, furnish all information
requested, declare actual income received from all sources, and pay taxes due on a timely basis. Any notice
of objection or appeal against an assessment must be lodged within 30 days from the date of service.

Individuals carrying on a business are required to keep and retain sufficient records for seven years, and
those with employment or investment income must keep and retain documents for the same period for the
purpose of ascertaining their chargeable income and tax payable.
(b)
(i) For sole proprietorships, the income tax rates range from 0% to 30% depending on the amount of taxable income
earned. Meanwhile, private limited companies are subject to a flat tax rate of 17% / 24% on their chargeable
income.

(ii) For a sole proprietorship, the business owner is required to file a personal income tax return (Form B) by 30
June in the following year. The form must include the income earned by the business as well as the owner's personal
income.

For a private limited company, the company is required to file a corporate income tax return (Form C) - depend on
financial year end (within 7 month after the financial year). The form must include the income earned by the
company and its tax calculations.

(iii)
For sole proprietors, - 6 bi monthly installment ( every 2 month), due date for S4(a), 30 June in the following year.

Private limited companies, on the other hand, are required to make instalment payments on a monthly basis based
on the estimated tax payable for the current year, with any balance of tax payable to be settled by the submission
deadline of Form C.
Question 2
Tax Administration (Individual)
The collector of the Inland Revenue Board (IRB) issued a Notice of Instalment Payment (From CP500) under
Section 107B to Mr. Chan in February 2021. The IRB has estimated his tax liability for the year of assessment
2021 to be RM600,000.

However, according to Mr. Chan, his estimated tax liability for the year of assessment 2021 is only RM240,000.
He requested a variation of the instalment scheme. The IRB agreed and issued an amended Notice of Instalment
Payment to him. The due dates for instalment payments and the dates of payments actually made are as follows:
Due Date Amount Date payment made

01.03.2021 40,000. 06.04.2021

01.05.2021 40,000 30.05.2021

01.07.2021 40,000 08.08.2021

01.09.2021 40,000 24.09.2021

01.11.2021 40,000 28.11.2021

01.01.2022 40,000 06.01.2022

240,000

His deemed assessment for the year of assessment 2021 shows a tax liability of RM360,000 when Mr. Chan
submitted his Form B on 18 June 2022.
(a) State the date by which any request for variation of instalments must be made by Mr. Chan. (1 marks)

Mr. Chan should request for variation of instalments latest by 30 June 2021

* Form B Resident individual receiving income from sources other than employment
* Provided that the Director General may, upon an application made by the person not later than 30 June in that year
of assessment, vary the amount to be paid by instalments on account of tax and the number of instalments. ss107B(2)

(b) Determine the penalties imposed, based on the actual dates of payment. (2 marks)
*any instalment amount due and payable on the date specified by the Director General has not been paid within
30 days of the due date, the amount unpaid shall, without any further notice being served, be increased by a
sum equal to 10 % of the amount unpaid, and that sum shall be recoverable as if it were tax due and payable
under this Act. ss107B(3)
State and explain

Due date Amount 10%

01.03.2021 40,000 4,000

01.07.202 1 40,000 4,000

(c) Compute the penalty for the excessive difference in tax payable arising from the variation in instalment
payment. (3 marks)

RM *an application is made to vary the

amount payable by instalments, and the
Tax Payable (actual) 360,000 tax payable under an assessment for that
year of assessment exceeds the total of the
instalments payable and the difference is >
Less: instalment (240,000)
30 % of the tax payable under the
assessment, then without any further notice
Net Tax Payable 120,000 being served, the amount of the difference
which exceeds 30 % of the tax payable
shall be increased by a sum equal to 10 %
of that amount of difference, and that sum
30% of actual tax payable 108,000 shall be recoverable as if it were tax due and
payable under this Act. ss107B(3)
Excess subject to a penalty 12,000

10% penalty payable (12,000*10%) = 1,200

(a) State and explain to Encik Hassan the due date to request for a variation of instalments under
Section 107B.

Encik Hassan has to request for a variation of instalments before 30 June 2022.

● Add explanation !

(b) Based on the actual dates of payment, explain and compute the penalty, if any, for the above
instalments made by Encik Hassan.

Where any instalment amount due and payable on the date specified by the Director General has
not been paid within 30 days of the due date, the amount unpaid shall, without any further notice
being served, be increased by a sum equal to 10 % of the amount unpaid, and that sum shall be
recoverable as if it were tax due and payable under S107B(3). - explain in yr own ways

Due date Amount Penalty 10%

01-05-2022 20,000 2,000

01-07-2022 10,000 1,000

(c) Compute the penalty, if any, arising from the request for variation of instalments
made by Encik Hassan.

RM

Tax Payable (actual) 125,000

Less: instalment (80,000)

Net Tax Payable 45,000

30% of actual tax payable 37,500

Excess subject to a penalty 7,500

10% penalty payable (7,500*10%) = RM 750

(d) State which income tax return form should be submitted by Encik Hassan.

Form B

(e) State and + explain the due date for submission of Encik Hassan’s tax return.

30 June 2023, because he is resident individual and receive income from sources other than employment.

(f) State the differences between a taxpayer who submits Form BE and one who submits Form B for the year of assessment 2022 in
terms of:

(i) Due date for submission;

30 April 2023 for taxpayer who submits Form BE;

30 June 2023 for taxpayer who submits Form B

(ii) Payment of tax instalments;(show different for both)

Form BE - monthly tax deduction

Form B - 6bi monthly installment

(iii) Due date for payment of final income tax.

Pay the any balance of tax payable by 30.4.2023 (with employment only)

30.6.2023 (also with business income) for YA 2022.

 Tutorial 11
Wei Yi, Shun Jin, Jia Qi
Question 1
Answer
Computation RPGT for Charles - Year of Assessment 2022
Answer (Con’t)
Answer (Con’t)
Answer (Con’t)
Holding Period

Charles has entered into a written sales and purchase agreement, so disposal of real property
shall be deemed to have taken place on the date of such agreement regardless that the money
consideration has not been received.
RPGT Rate
Date Periods

20 July 2016 - 19 July 2017 1st Years

20 July 2017 - 19 July 2018 2nd Year

20 July 2018 - 19 July 2019 3rd Year

20 July 2019 - 19 July 2020 4th Year

20 July 2020 - 19 July 2021 5th Year RPGT Rate : 0%

20 July 2021 - 10 June 2022 5th Year 11 Months

https://docs.google.com/spreadsheets/d/1nsQMVyLtbhmpR
CKS-6gEhfAq6DgC2ACBfUgQk_txhng/edit?usp=sharing
2a) The land is an asset owned by a citizen which is Kelvin. This transfer of asset
is a no gain no loss situations.

Under Para 3 of Sch 2 RPGTA 1976, the disposal price of the piece of land is
deemed equal to the acquisition price because the transaction happened between
Kelvin and the company wholly-owned by Kelvin and his wife.

Hence, Kelvin will not subject to RPGT for YA 2019 as there is no gain or loss.
Rockworld Sdn. Bhd.
Computation of real property gains tax - Year of Assessment 2022
RM RM

Acquisition price *(Put under disposal price)

Acquisition price paid by Kelvin:

Consideration paid 400,000

Add: Incidental costs

Stamp duty 10,000

Legal fee 4,000

Less: Capital receipts

Deposit forfeited (6,000) 408,000

Add: Permitted expenses incurred by Kelvin

Legal expenses in defending the title of the land 5,000

 413,000

Disposal price

Consideration received 1,200,000

Less: Permitted expenses (250,000)

Add: Cost of building

Less: Incidental costs

Agent fee (12,000)

938,000

Chargeable gain 525,000

Less: Allowable loss (30,000)

Gains subject to RPGT 495,000

RPGT rate (4th year)* 20%

RPGT payable 99,000

*Holding period (5/5/2019 - 30/11/2022) = 3 years 7 months

(a) State, with explanations, the date of acquisition of the land by Tim.

The date of acquisition of the land by Tim is on 5 June 2019, when the written sales and
purchase agreement to acquire the house was signed. The acquisition is deemed to have
taken place on the date of such agreement regardless that the money consideration has not
been received on that date but on 1 January 2020.

(b) Compute the real property gains tax payable by Tim for the year of assessment 2022.
4b Tim

Computation of real property gains tax - Year of Assessment 2022

RM RM

Disposal Price

Consideration received (market value or net proceeds, whichever is the greater) 520,000

Less: Incidental costs

Valuation fee 5,500

Legal fee 8,000

Commission to agent 2,000

15,500

Less: Permitted expenses

House extension and renovation 35,000

469,500
Acquisition price

Consideration paid 300,000

Add: Incidental costs

Stamp duty 4,500

Legal fee 2,500

7,000

Less: Capital receipts

Insurance compensation for fire damages 48,000

Deposit forfeited in connection with aborted disposal of RP 6,500

54,500

252,500
Chargeable gain 217,000

Less: Sch 4 exemption

RM10,000 or 10% of Chargeable gain

Whichever is greater (21,700)

Gains subject to RPGT 195,300

RPGT rate 20%

RPGT payable 39,060

Less: Loss relief (3,000)

RPGT payable 36,060

Date of acquisition: 5/6/2019

Date of disposal: 12/12/22

Holding period = 3 year 6 months (=in the 4th year)

(c) Explain Susan’s RPGT responsibilities as the buyer of this house.
Under Section 21B RPGT Act 1976, the acquirer is responsible to withhold the whole amount
of money received or 3% or 5% or 7% of the total value of consideration (whichever lower)
and shall within 60 days after the date of such disposal pay over to the IRB.
Since the disposer (Tim) is a Malaysian citizen, the acquirer (Susan) is to withhold the whole
amount of money received or 3% of the total value of consideration (whichever lower) and
shall within 60 days after the date of such disposal pay over to the IRB.

3% x 520,000 = 15,600
Not later than 10th February 2023
Non-compliance to this will result a late payment penalty of 10% (1,560) being imposed, and
become a debt due to the government.
 Tutorial 10
Ji Qiao, Ji Shan, Hui Xin
 Zent
Industrial building allowances

RM’000

Land cost Nil

Legal fee for purchase of Nil

land

Consultation fee and 55

building plans

Stamp duty for purchase of Nil

land

Construction cost 550

Total 605

Less: 12% of the total floor (73) > 10%

area of the new building

QBE 532
YA 2021 RM’000

QBE - Buildings 532

Initial allowance (IA) 10% (53)

Annual allowance (AA) 3% (16)

Residual expenditure as at 31 December 2021 463

YA 2022 RM’000

QBE - Buildings 463

Annual allowance (AA) 3% (16)

Residual expenditure as at 31 December 2022 447

Question 2 (a)

YA2022 RM

Construction of factory building: RM QBE 1,496,000

Cost of land Nil. Initial allowance 10% (149,600)

Construction costs of factory building 1,200,000 Annual allowance 3% (44,880)

Payment to local authority for approval of the factory 80,000 Residual expenditure at 31 1,302,520
building’s plan December 2022

Architect’s fees 130,000

Legal fees for the purchase of land Nil.

Legal charges in connection with the factory building 70,000

Incidental expenditures on drainage scheme and wiring for 280,000

electric supply

Total cost 1,760,000

Less: 15% for office space (264,000)

Qualifying Building Expenditure (QBE) 1,496,000

YA2022

Moulding Machine RM

Cost of machine 510,000

Cost of alteration to existing building 50,000

Installation cost 20,000

QPE 580,000

QPE 580,000

Initial Allowance 20% (116,000)

Annual Allowance 14% (81,200)

Residual Expenditure at 31 December 2022 382,800

YA2022
60,000/510,000 x 100% = 11.8%
Packaging Machine RM
The cost of preparing the site for the installation of machine is
not qualify as the plant expenditure because it exceeds 10% of
Cost of machine 450,000
the aggregate of the cost of machine and the cost of preparing
the site for the installation of machine.
Cost of preparing the site for the 60,000
installation of the machine Therefore the Qualifying Plant Expenditure (QPE) is RM
450,000 where the cost of machine is solely inclusive.
Aggregate cost 510,000

QPE 450,000

Initial Allowance 20% (90,000)

Annual Allowance 14% (63,000)

Residual Expenditure at 31 297,000

December 2022
YA2022

Office Equipment RM

Printer (5 units x RM 500) 2,500

Scanner (2 units x RM 300) 600

QPE 3,100

QPE 3,100

Special Allowance 100% (3,100)

Residual Expenditure at 31 December 2022 Nil.

Mercedes-Benz RM

QPE for Mercedes-Benz 50,000

YA2022

Deposit 60,000

Instalments [(300,000-60,000) x 7/48] 35,000

Total Capital Payment 95,000

QPE 50,000

Initial Allowance 20% (10,000)

Annual Allowance 20% (10,000)

Residual Expenditure at 31 December 2022 30,000

Question 2(b)

Three conditions to be fulfilled for claiming capital allowance:

First, the person must be carrying on business.

Second, the person must incur qualifying expenditure, i.e. qualifying plant expenditure (QPE) or qualifying building expenditure (QBE)

Third, the assets must be in use for the business purpose at the end of the relevant basis period.

* The person must be the owner of asset at the end of the relevant basis period.
(a) Compare and explain the difference between the tax treatments for small value assets and
assets claimed on a replacement basis.

Small value assets

● Can be deducted through 100% capital allowance in the year of acquisition
● Must fulfill the following criteria:
a) The asset has a useful life more than 2 years
b) The value of assets less than or equal to RM2,000
c) The total capital allowance claimed must less than or equal to RM20,000
d) The person who claims capital allowance must be the owner
● The threshold RM20,000 does not apply to Small and Medium Enterprises. SME is allow to fully
claim capital allowance on small value assets without any limit

Assets claimed on replacement basis

● Replace asset due to damage, loss, and theft
● The cost of replacing the asset is claimed as a tax deduction
● Must fulfill the following criteria:
a) There is evidence to support the replacement of the asset
b) The replacement cost must not exceed the original cost of the asset
c) The replacement asset was used for the purpose of generating income
(b) Compute the industrial building allowance, capital allowance and balancing adjustment in
respect of all the above non-current assets of Metro Sdn. Bhd. for the year of assessment 2022.

(i) Construction of a factory building RM RM

YA 2022 QBE 669,600

Cost of land Nil Initial allowance 10% (66,960)

Legal fees for - agreement for purchase of land Nil Annual allowance 3% (20,088)

Legal fees for - agreement with contractor for 7,000 Residual expenditure at 31 582,552
the construction of factory building December 2022

Architect’s fee 10,000

Piling and foundation works 20,000

Cost of construction 800,000

Total cost 837,000

Less: 20% for office space (167,400)

Qualifying building expenditure (QBE) 669,600

(ii) Machine A RM

YA 2022

Cost of machine 420,000

Cost of alteration to the existing building for the installation of the machine 33,600

Cost of installation of the machine 3,600

QPE 457,200

QPE 457,200

Initial allowance 20% (91,440)

Annual allowance 14% (64,008)

Residual Expenditure at 31 December 2022 301,752

(iii) Office equipment RM

Fax machine 1,500

Office cabinet 1,000

QPE 2,500

QPE 2,500

Special Allowance 100% (2,500)

Residual Expenditure at 31 December 2022 Nil

Treat as small value asset

 Tutorial 9
Wei Jie, Maicy, Chai Ying
https://docs.google.com/spreadshe
ets/d/10SMyXPfMTpubvu6t5wwew
BndkKdp9qAwgJ4xnmEM7mQ/edit
#gid=0
YA 2022
Delivery van (cost) 180,000

Qualifying plant expenditure 180,000

Initial allowance 20% 36,000
Annual allowance 20% 36,000 72,000
Residual expenditure as at 31.12.2022 108,000
Toyota Camry on Hire Purchase
QE for Toyota Camry = RM50,000

YA 2022 RM
Deposit 88,000
Instalment (80,000/48*9) 15,000
Total Capital payment 103,000

Qualifying plant expenditure 50,000

Initial allowance 20% 10,000
Residual expenditure as at 31.12.2022 40,000

Disposal RM126,000 (50/168*126000) 37500

Balancing allowance 2,500

 Tutorial 8

Wei Peng , Kok Khai, Mei Yi, Wei Hong

Question 1
Soma Sdn. Bhd., a Malaysian tax resident company, made the following payments for the year ended
June 2022:
(i) Technical advice fee of RM60,000 paid to Segi Pte. Ltd., a UK company, for the transfer of
technical know how where the services were performed solely outside Malaysia.
(ii) Commission of RM5,000 paid to Sally, a full-time housewife residing in Singapore for the sales
of a shophouse in Johor Bahru.
(iii) A loan interest payment of RM30,000 was paid to Libra Pte. Ltd, a non-tax resident. The loan
was used by Soma Sdn. Bhd. for the acquisition of plant and machinery for its business in
Malaysia.
Required:

(a) Comment on the withholding tax implications for each of the above payments made to a non-
resident. (11 marks)

(b) Advise Soma Sdn. Bhd. in respect of the withholding tax obligations and consequences for non-
compliance.
a) Comment on the withholding tax implications for each of the above payments made to a non-
resident. (11 marks)

(i) Segi Pre Ltd is a non - resident company , Soma must withhold a 10% tax on the gross amount of RM60,000
and remit the amount to the IRB within the stipulated time.
This is due to technical fees falls under special classes of Income S4A( ii) is subject to withholding tax
provisions,
However , the service performed outside Malaysia so withholding fees is not applicable

(ii) Sally is a non-resident individual, Soma must withhold a 10 % tax on the gross amount RM5,000 and remit
the amount to the IRB, The net balance of 90% ( RM 4500) will be received by Sally. This is due to commission
income falls under casual income S4( f ) is subject to withholding tax provisions.

( iii ) LIbra PTe Ltd is a non- resident company , Soma must withhold 15% tax on the gross amount of RM
30,000 and remit the amount to IRB. The payment is deemed to derived from Malaysia that the loan was utilized
to produce income in Malaysia . The net balance of 85% will be receive by the Libra Pte Ltd. This is due to
interest income falls under S109 that is subject to withholding tax provisions.
(b) Advise Soma Sdn. Bhd. in respect of the withholding tax obligations and consequences for non-
Compliance.

Soma should pay upon or credit the payments to the non resident , as the tax at the rate applicable and shall
within one month after paying or crediting the amount render and pay the amount or tax to the IRB.

If Soma Sdn Bhd failed to do so , it will to some consequences

- Additional charge of 10% penalty on unpaid withholding tax
- Gross payment paid would not allowed as deduction in ascertaining the adjusted income of Soma under
S39 ( 1 ) ( i )
- Tax authorities may impose penalty under S113( 2 ) of the Income Tax Act ( 1967), for being an incorrect
return submitted by the taxpayer.
- Amount that should be deducted shall be a debt to the Government by Soma
a)This is a false statement. Individuals' resident status will not be determined by their citizenship. An
individual's tax resident status is decided by the number of days he spends in Malaysia. He will be a
tax resident in Malaysia if he meets one of the conditions set out in Section 7(1)(a) to (d) of the ITA
1967. While the engineers are not Malaysians, they will be tax residents in Malaysia in 2021/2022 if
they spend at least 182 days (1 year) in Malaysia, as required by Section 7(1)(a) of the ITA 1967.

b)
Under territorial basis, the engineer are excersicesing their experience in Malaysia under Section
13(2)(a) of the ITA 1967, so the income is derived from Malaysia and them is a Malaysian taxpayer. So
the engineers is subject to tax in Malaysia.

c)
1MSB shall within 1 month after paying contract payment to Canociti Ltd, a non-resident contract,
render an account and pay the following amount of withholding tax to the Director General of the
Inland Revenue.
i) 10% of the service portion of the contract payment made to Canociti Ltd for the tax account of
Canociti Ltd.
ii) 3% of the service portion of the contract payment for the tax account of the employees of Canociti
Ltd.
The 10%+3% Withholding under Section 107A of the ITA 1967 will be an advance tax (not final tax).
Cost of plant and materials of RM140m (RM200m x 70%) are excluded from WT as only the service
portion of the contract payment of RM60m that will be subject to WT.
WT deduction is calculated on RM60m x 13% which is RM7,800,000.

d)
i) Chargeable income = RM20,000,000
ii) Tax payable = RM20,000,000 * 24% = RM4,800,000
iii) Withholding tax paid= (10%)(60,000,000*10%) = RM6,000,000
iv) Tax repay = Withholding tax paid - Tax payable
= RM6,000,000 - RM4,800,000
= RM1,200,000
(a) This is a contract payment, it is an advance tax under S107A, the withholding tax rate is
(10% + 3%). Under S107A, all contract payments in respect of services under a contract to
non-resident (NR) contractors are subject to WT. Services under a contract refer to the
performing or rendering of any work or professional service in Malaysia relating to the
contract project in Malaysia.

Yoki Ltd would be non-resident contractor and therefore withholding tax would apply under
S107A on the service portion of contract payments paid or credited to the contractor WT of
10%+3% would apply on RM1,200,000 and no WT on the RM800,000 (non-service portion).

For Southwest Ltd., it is also a non-tax resident. Tsun Tsun Sdn. Bhd leased a crane at a
lease rental of RM500,000. Crane is a machinery and WT will not be applicable for the cost
of plant and machinery and materials, therefore it is excluded from withholding tax. The
design of the suspension bridge was solely done in Korea. Any payments made for work or
services performed outside Malaysia (although related to a project in Malaysia) are not
subject to the provisions of S.107A. Therefore, RM200,000 is also excluded from
withholding tax.
 (b) The due date to pay the withholding tax to IRB is within one month after paying or
crediting the amount render an account. The amount of withholding tax that Tsun
Tsun Sdn. Bhd. needs to withhold in respect of the payments made to Yoki Ltd. and
Southwest Ltd is (RM1,200,000*10%) + (RM1,200,000*3%) = RM156,000

(c ) The first consequences of non-compliance of the withholding tax provisions according

to the Income Tax Act, 1967 is the amount that should have been deducted shall be a debt
to the Government by the payer. Besides, a penalty of 10% on the WT will be imposed for
non-payment within the stipulated period. Moreover, the gross payment paid would not be
allowed as a deduction in ascertaining the adjusted income of the payer under
S.39(1)(i).(This subsection shall not apply (gross payment will be tax deductible) if the
payer has paid the amount).
a) Under Section 109, Advance Sdn.Bhd will need to withhold RM6,000(15% of RM40,000) from
the interest payment and remit it to the Inland Revenue Board(IRB) within one month from the
date of payment. The remaining interest RM34,000 may be paid to Fintech Ltd.

b) Under Section 109, the withholding tax rate for royalty payments is 10%, therefore, Advance
Sdn.Bhd should have withheld RM20,000(10% of RM200,000) from the royalty payment and
remitted it to the Inland Revenue Board(IRB) within one month from the date of payment.The
remaining RM180,000 may be paid to Fintech Ltd.
 Tutorial 7
Yin Teng, Elvis, Iwyon
 RM’000 (+) RM’000 (-) RM’000

Profit before tax (261)

Add: Adjustment

Provision for doubtful debts 77

Obsolete stocks written off Nil

Realised loss on the purchase of materials . Nil

Unrealised gain on the sale of stocks to Singapore . 36

Interest income received from RHB Bank Malaysia . 53

S2(d)

Salaries to a part-timer Nil

EPF contributions by the employer (20%) 3

- Restricted to 19% (60,000*1/20)

Rental of factory premises Nil

Lease of car for company’s Director 10

Annual dinner for company staff Nil

Hampers to customers and suppliers during 17

festive seasons (34*50%)

Food and drinks were provided to shareholders 22

during the company’s AGM

Tax filing fee (20) and Secretarial fee (4) 9

Maximum 15,ooo deduction
(20+4) -15

Tax appeal fee (99) 99

Revenue Nil

Electricity and water Nil

Depreciation 101

Compounds and fines for traffic offenses 8

Cash donation to an approved institution 50

396 89 307
Adjusted business income 46

Less: Capital allowance (12)

Statutory income 34

Interest received 53

Aggregate income 87

Less: Cash donation to an approval institution (8.7)

(10% restricted to aggregate income)

Total income/ chargeable income 78,300

First 600,000 * 17% 78,300*17% 13,311

Tax liability
 RM’000 (+) RM’000 (-) RM’000

Profit before tax 3,545

Add: adjustments

Turnover Nil

Provision for obsolescence stocks 500

Interest income from Maybank Berhad 250

Compensation received from a competitor 1,000

Salaries: Staff Nil

Salaries: Senior management Nil

EPF contributions (15% for staff) Nil

EPF contributions (25% for senior management) 30

*Maximum 19% (6% x 500,000)

Bad debts written off Nil

 RM’000 (+) RM’000 (-) RM’000

Increase in the specific provision (Section 34) Nil

Increase in the general provision 120

Cash donation to a political party 20

Donation of computers to schools 50

Entertainment to trade suppliers (50%) 6

Annual dinner given to employees Nil

Free trip as an incentive to sales agents for Nil

achieving sales targets (RE for business purpose)

Statutory audit fee Nil

Secretarial and tax filing fees (22,000, allowed up to 7

15,000)

Legal expenses incurred in connection with a new 85

bank loan (Capital expenditure)
 RM’000 (+) RM’000 (-) RM’000

Repair and maintenance (extension repairs) 120

Rental expenses (RE for business purpose) Nil

Depreciation 750

Miscellaneous expenses (RE for business purpose) Nil

1,688 1,250 438

Adjusted business income 3,983

Less: Capital allowance (633)

Statutory business income 3,350

Interest income from Maybank Berhad 250

 RM’000 (+) RM’000 (-) RM’000

Aggregate income 3,600

Less: Donations

Cash donation to a political party Nil

Donation of computers to schools Nil

Nil

Total income / chargeable income 3,600

Tax liability: (paid-up capital > RM2.5 million)

(3,600,000 x 24%) 864

Tax payable 864

Green Ocean Sdn. Bhd.

Tax computation for the YA 2022 RM’000 (+) RM’000 (-) RM’000

Profit before tax 755

Add: Adjustment

Sales Nil

Single tier dividend by a locally listed company 20

Insurance compensation for the damage of factory due to fire 40

Salary Nil

EPF contribution 16.5

One holiday trip to New Zealand with his family 20

Annual company dinner attended by staff and few customers Nil

Reimbursement of entertainment incurred by sales personnel (18,000*50%) 9

 RM’000 (+) RM’000 (-) RM’000

Promotion gifts at the overseas trade fair to promote export Nil

Company annual trip to Pulau Langkawi Nil

Legal fees in relation to the acquisition of patent (15,000*80%) 12

Legal fees incurred in obtaining bank facilities 5

Tax compliance and secretarial fees (18,000-15,000) 3

Extension of showroom 13

Maintenance of plant and machinery Nil

Replacement of factory roof with better quality materials 14

Renewal of office wiring Nil

Loan to a supplier written off 8

General allowance of doubtful debts 21

 RM’000 (+) RM’000 (-) RM’000

Specific allowance for doubtful debts 6

Bad debt recovered (non-trade) 9

Sundry expenses included a gift of a painting to the National Art Gallery 7.5

Depreciation 50

Bank interest for a loan used for business Nil

Telephone and broadband Nil

Utilities Nil

Statutory audit fee Nil

185 69 116

Adjusted business income 871

Less: Capital allowances (78)

 RM’000 (+) RM’000 (-) RM’000

Less: Unabsorbed business loss brought forward (14)

Statutory business income 779

S4(c) Single tier dividend by a locally listed company Nil

Aggregate income (all sources) 779

Less: Donation

Donation (gift of a painting to the National Art Gallery) (7.5)

Chargeable income 771.5

Tax payable (RM771,500*24%) = RM185,160

 Tutorial 6
Ruo Yin, Sek Ying, Zi Hong, Zhi Ken, Wan Tien
Question 2
Do the following expenditures qualify for tax deduction? Circle the correct answer.

1. Capital expenditure. YES / NO (long-term benefit) S33

2. Expenditures that are for private or domestic purposes. YES / NO S33

3. Expenditures incurred which are not wholly and exclusively in the production of gross income.
YES / NO S33 (must be solely- 100% for business purpose)

4. Provision, reserve, contingent liability or warranty in the accounts. YES / NO S33

( if is warranty expenses, then deductible, the company straight away change the whole new
product to the customer)

5. Expenditure incurred to acquire a source of income. YES / NO

(Eg: setting up new branch, business structure, capital expenditure )

6. Expenditure incurred to produce an income. YES / NO

7. Expenditure incurred after cessation of a source of income. YES / NO

a) RM 60,000 taxable, because it is revenue income. RM 20,000 gain on
disposal non-taxable because it is capital in nature.
b) It is taxable because it is revenue receipts. (compensation to replace loss of income).
c) Deductible. Because compensation of dismissal of employment is a type of
salary payment, and it is revenue expenditure that incurred in production of
income.
d) Non-deductible, because it is considered as the initial cost of the machine, so
it is capital expenditure.
e) 19% deductible and 6% non-deductible. S34 (4)
 Question 4

Explain the tax treatments of the following expenses that are deductible/not deductible for tax purposes:

1. Company’s general meeting expenses

Ans: Non-deductible. It is not expenses for generating income and it always held after the financial year.

2. Advice on the shareholding structure.

Ans: Not deductible because it is a capital expenditure this expense is not wholly inclusively incurred in the
production of income.

3. Donation to an approved institution (in cash)

Ans: Donation is not deductible as it is not wholly inclusively incurred in the production of income.
However, it is deductible up to 10% of aggregate income.

4. Overseas leave passage

Ans: Section 39 ITA 1967, Leave passage given for employees are non-deductibles.
5. Donation of books to a public library
Ans: Deductible. Section34(6)(g) classified such donation as business expenses Up to
RM100,000.

6. Salary paid to an accounts clerk of a company for preparing and submitting sales
tax returns to the Royal Malaysian Customs.
Ans:
It is deductible and the salary expense is revenue expenditure. It is wholly inclusively
incurred in the production of income.

7. Fees paid to a tax agent for advisory services provided on tax planning for a group
of companies.
Ans: Non-deductible the expenses incurred for tax planning is not deductible as it is
capital in nature. Also it is not wholly inclusively incurred in the production of income.
1.Entertainment given to a potential customer in a Fully disallowed
closed transaction.

2 Entertainment given to a potential or existing 100% deductible

customer during the launching of the company's
new product.

3.Wedding gift to employee of customer. Fully disallowed

4.Entertainment to employees of related company. Fully disallowed

5.Entertainment for Annual General Meeting of a Fully disallowed

company.

6.Cash contribution for annual dinner of a trade Fully disallowed

debtor.
7.Annual dinner given to employees of the company. 100% deductible

8.Gifts with business logo for customer's annual 100% deductible

dinner.

9.Gifts without business logo for customer's annual 50% deductible

dinner.

10. Free trip as an incentive to sales agents for 100% deductible

achieving sales target.

11.Gift of flowers for congratulating customer for 50% deductible

opening of new outlet.

12.Entertainment to trade suppliers. 50% deductible

13.Hamper for customer during festive seasons. 50% deductible

Question 6 (May 22 - 2013)

It is the most tax efficient to carry on a business with the incorporation of a private limited
company (Sdn. Bhd.). The Companies Act 2016 allows a Sdn. Bhd. to be owned by one
shareholder with one director, commonly known as a single person company.
Required:

(a) Briefly explain the meaning of small medium enterprise (SME) from the Malaysian
income tax perspective. (2 marks)

A resident company in Malaysia with an authorized capital not exceeding RM2.5 million
and the gross business income not more than RM50 million.
(b) Explain the preferential tax treatments which are applicable to a small medium
enterprise in accordance with the Income Tax Act, 1967. (8 marks)

Firstly, SMEs are eligible for a lower corporate tax rate of 17% on the first RM600,000
chargeable income. In case the chargeable income exceeding RM600,000, it is charged at a
standard corporate tax rate of 24%.

Next, SMEs can enjoy double deduction for expenses incurred on approved training
programs by Malaysian Investment Development Authority (MIDA) and Minister of
Finance or agency appointed by MoF.

Furthermore, SMEs are eligible to claim special allowances for small assets value not
more than RM2,000 (each) and not subject to annual limit RM20,000.
(c) Explain the tax treatment in respect of the following:
(i) One unit of goods was reclassified from current asset to non-current asset. The cost
price of the goods was RM20,000 per unit and the normal selling price is RM25,000.
(3 marks)
Goods withdraw from business use will be taxable at selling prices (RM25,000) and treated as income
from business is subject to tax. The cost of the goods RM20,000 will be eligible for tax deduction.

(ii) Insurance compensation received in respect of goods damaged. (2 marks)

It is taxable because it is revenue receipts. (compensation to replace loss of income)

(iii) Stamp duty paid on the increase in the issued share capital. (3 marks)
Increase in the issued share capital is a business nature which is capital in nature, hence, it is not
deductible.

(iv) Realised foreign exchange loss on the importation of trading stock. (2 marks)
It is deductible because there is loss from trade transaction and is realisable.

[Total: 20 marks]
 Tutorial 5
Wei yi, Mervin, Jia Qi , Kin Wai
Answer
1.) Intention of Taxpayer
They have intention to make profit (revenue gain) when they subdivided
into to lots and converted into commercial land. They purchased the
agriculture land and that is not for agriculture purpose and more for resale
estate purpose.
2.) Financing arrangement / Mode of Acquisition
The land costing RM120,000, and Chandra and Bakar have applied full bank
loan to purchase the land. This can considered that they were involved in a
trading adventure.
Answer (Con’t)
3.) Alteration to Property or Improvements or Supplementary Work
The land was subdivided into two lots and converted into commercial land. This can
affect the value of land increase which these two land has increased the value from
RM120,000 to RM360,000 and RM400,000 respectively. Besides, they alteration of land
can help them to sell the land easily. Therefore, there would suggest that a trade is
carried on
4.) Period of Ownership
The period of ownership is considered short, after two year (from 2018 to 2021)
Chandra and Bakar converted the land into commercial land. Besides, they immediately
sell and transferred the land into shares to the real estate company after one year of
conversion of land to commercial land.
Answer (Con’t)
5.) Interest in Similar Field

Chandra as land officer and he know about the development of the town of Kulim.

He purchased the agriculture land near the expanding town of Kulim - This can
considered they want immediately to sell the land as it more easily to sell the
land.
Answer (Con’t)
Conclusion:

The above transaction ae the profit from a trading adventure in the nature of
trade so it is chargeable to income tax under Section 4 (a) Business Income.
1. Repetition or frequency of transaction
Since neither Julian nor his wise had previously disposed of any real property, the gain from selling the
land should considered capital income.
2. Financing arrangement/Mode of acquisition
Julian is considered as a investor of land because he had paid 83.33% (250,000 / 3000,000) of the value
of the land. This showed that he had paid a majority of the land which is more than 75%.
3. Alterations to property or improvement or supplementary work
From Cape Brandy Syndicate v CIR (1921), Julian was held not to be carrying on a trade because he
haven’t made any alterations towards the land. This move would not be viewed by the tax authorities as
a step towards ‘an adventure in the nature of trade. (Agriculture land → Agriculture land)
4. Timing / Length / Period of ownership
As Julian’s period of ownership between acquisition and disposal of the land is long (> 5 years), there is
a strong inference of investment.
5. Methods / Ways of disposal

The activity employed by Julian in disposing the land which is hiring an real estate agent will
increase his probability to sell the land.

6. Circumstances responsible for realization / Surrounding factors

There is a forced sale, to provide cash required for Julian’s migration. Therefore, it negates the
idea that the land was purchased with the intention of trading.

In conclusion, the gain of RM300,000 should be considered as capital gain and not taxable under
Income Tax Act.
Question 3 – Taxability of Receipts

(A)
Answer:
(a)

Proceeds from an insurance policy are taxable if the loss of cash of RM50,000 in the year of
assessment 2021 was allowable.

3(A)(b)

The amount is deemed to have been received in YA 2022 and is a taxable receipt for YA 2022
instead of YA 2023.

(b) The taxable year of assessment would be in the year 2022 since insurance company
confirmed the insurance payment in 2022. (according to accrual basis)
Answer:
The rentals received by the company should be accessed as income derived from business
income.
According to Section 4(a), for rental income from letting real properties to be treated as
business income, maintenance services or support services should be comprehensively and
actively provided.
Besides, Chain Sdn Bhd do alterations work which is to partition the building into shop lots.
Therefore, it would suggest that a trade is carried on.

Any unabsorbed losses from the departmental store can be carried forward to the subsequent
year(s) of assessment, and to be deducted against the aggregate income from all
businesses under Section 43(2), which in this case to deduct from the aggregate income of
the renting business.
Answer :
In this case, the compensation received by Melvin is a capital receipt. This is because the
compensation received is for the loss of the truck which is a capital asset.

The truck is a capital asset because it was purchased for the purpose of Melvin's trading
business. Hence, RM35,000 received for the loss of the truck is non-taxable and it is a
capital receipt. However, it will be taxable if there is a balancing charge (gain of disposal).

The goods are revenue assets because they are inventory held for sale in Melvin's trading
business. Hence, RM45,000 received for the loss of the goods is taxable.
Answer : Case Law - Kelsall Parsons & Co. v CIR
In this case, the compensation received by Axel (RM800,000) is considered as revenue
receipt.

Although the manufacturer accounted for 50% of Axel's revenues, the compensation
received was not related to the destruction or material impairment of the whole structure
of Axel's profit-making apparatus. Axel managed to secure another 3 manufactures and
continued its operation, indicating that the termination of the contract did not result in a
substantial and long-lasting impairment to its ability to generate income.

Hence, RM800,000 received for breaching of contract is taxable.

 Tutorial 4
Chai Ying, Ji Qiao, Ji Shan, Hui Xin
Link
https://docs.google.com/
spreadsheets/d/1JSfM_b
c-Q4QhKFiQzVMsQxzM
9OD7kNvYONbFnqUFm
VY/edit#gid=0
https://docs.google.com/spre
adsheets/d/1McuC8PoGIoxK
LHGdkVWdmSNjdxNVV6w4
Fdw8CvTt7z4/edit#gid=0
 Jordan
Income Tax Computation for Year of Assessment 2022

RM RM

Section 4(a) business income

Sole proprietorship business :

Adjusted Income NIL

Balancing charge 10,000

Less:
Current year capital allowance (8,000)

Statutory Business Income 2,000

Less: unabsorbed business loss b/f (2,000)

NIL

Section 4(b) Employment income

Section 13(1)(a)

Salary 108,000
Bonus NIL

Domestic servant (1,500 x 3) 4,500

112,500

Section 13(1)(b)

Piano (25,000/20) 1,250

Car (3,600 /2) 1,800

Fuel 1,200

Mobile phone NIL

Domestic servant (4800 x 9/12) 3,600

7,850

Gross employment income 120,350

Less: Allowable expenses

Professional subscription - ACCA (1,000)

Adjusted Income from employment 119,350

Section 4(c) interest NIL

Section 4(d) Rents, royalties or

premiums

Rent received 48,000

Royalty income (50,000 - 20,000) 30,000 78,000

Less: Outgoing expenses

Quit rent (1,200)

Interest on loan (2,500)

Replacement of broken doors (1,500)

(5,200)

Aggregate income 192,150

Less: Adjusted loss (45,000)

Total income 147,150

Less: Tax reliefs

self 9,000

EPF 4,000

SOCSO 300

Life Insurance premium 3,000

Medical expenses 8,000

Lifestyle relief 2,500

Additional lifestyle relief for personal computer 2,500

Sport Equipment 500

(29,800)

Chargeable income 117,350

Income tax on first RM100,000 10,700

Balance of 17,350 @ 24% 4,164

Tax rebates NIL

Zakat NIL

Tax payable 14,864

 Tutorial 3
Mei Yi, Wei Hong, Weijie, Maicy
5a)
5b)

Yes.
James's employment is exercised in Malaysia, his employment income is deemed to be
derived from Malaysia under S13(2)(a).

As such, even the salary is paid outside Malaysia, it is still subject to Malaysian income
tax. The place of payment is irrelevant but depends on the place where service performed.
(a) Estate agent's fee for first tenant is non deductible
expenses because it is an initial expense and should
be deemed as capital in nature.Besides, stamp duty
and loan processing fee are also non deductible
expenses as it is capital in nature. Legal fees which
related to real property is non-deductible because it is
capital in nature.Next, house valuation, renovation
and new air conditioner are also a non-deductible
expenses as they are capital in nature.Lastly, since
first tenant advertisement is an initial expense, it is
also non deductible.
(b) The house was not rented out from
September to October 2021 but the house had
been let out earlier. In 1 November 2021, the
house was prepare to let out again. As a result,
even the house wasn't rented out from
September to October 2021, the expenses
incurred for the vacant period are deductible
 Tutorial 2
Iwyon, Wei peng, Kok Khai
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
Tutorial 2
 Tutorial 1
Zhi ken, Wan tien, Yin teng, Elvis
 ● Section 8(1)(b)
a business is resident in Malaysia for the basis year for a year of
assessment
Management and control, or any of its businesses, are exercised in
Malaysia
● Section 8(1)(c)
Any other company is resident in Malaysia for the basis year of
assessment.
The directors had management and control in Malaysia during that
basis year
Tutorial 1
Tutorial 1
(a)

Year Period of stay Place No. of Tax residence status Reasons

days
2017 23 September to In Malaysia 100 Non-Resident <182 days.
31 December

2018 1 January to 30 October Not in Malaysia 303 Resident – s7(1)(b) of ITA <182 days but linked to a period of 212
1 November to 31 In Malaysia 62 1967 days which includes 13 days absence
December related to PTA (social visit)

2019 1 January to 31 March In Malaysia 90 Resident – s7(1)(a) of ITA In Malaysia for 199 days (at least 182
1 April to 13 April Korea (social 13 1967 days or more and need not be
14 April to 31 July visit) 109 consecutive)
1 August to 31 December In Malaysia 153
Not in Malaysia 199
2020 1 January to 30 April Not in Malaysia 121 Resident – s7(1)(c) of ITA Fulfil conditions:
1 May to 31 July In Malaysia 92 1967 1. In Malaysia >90 days
1 August to 31 December Not in Malaysia 153 2. be resident (2018, 2019) or >90
days in Malaysia (2017)
2021 1 January to 31 December Not in Malaysia 365 Resident – s7(1)(d) of ITA Fulfil conditions:
1967 1. be resident in the following year
(2022)
2. be resident for 3 years of
assessment from 2018-2020
2022 Resident
(b) Explain what constitutes ‘temporary absence’ under Section 7(1)(b) of the
ITA 1967.

Temporary absence or permitted temporary absence (PTA) from Malaysia of the following
three nature are considered as forming part of the “period of 182 days or more consecutive
or continuous days”.

Firstly, the absence that is connected with the employee’s service in Malaysia and owing to
service matter or attending conferences or seminars or study abroad.

Secondly, the absence is owing to ill-health involving himself or a member of his

immediate family such as parents, spouse and children excluding siblings.

Thirdly, the absence is in respect of social visits not exceeding 14 days in the aggregate.

Tutorial 1
Tutorial 1
 108 days < 182 days
83+31= 114 days < 182 days (PTA is not allowed
as social visit exceeding 14 days in aggregate)

31+69+156 = 256 days > 182 days

245 days > 182 days

Step 1 : 121 days > 90 days

Step 2 : Condition 1 - 2018 (> 90 days)
Condition 2 - 2020 and 2021 (Resident)
Year of assessment Resident status

2018 Non-resident

2019 Non-resident

2020 Resident under S7(1)(a)

2021 Resident under S7(1)(a)

2022 Resident under S7(1)(c) Tutorial 1

Tutorial 1
(a) Determine Ben’s tax residence status for the years of assessment 2018 to 2022. Explain your
answer based on Section 7 of the Income Tax Act, 1967.

244 days, social visit not

exceeding 14 days in aggregate

Year of Assessment Resident Status

2018 Non-Resident

2019 Resident - s7(1)(b) of ITA 1967

2020 Resident - s7(1)(a) of ITA 1967

2021 Resident - s7(1)(c) of ITA 1967

2022 Non-Resident
Tutorial 1
(b) Assume that Ben would be a tax resident for the year of assessment 2023. Explain the effect on
his residence status for the year of assessment 2022.

Year of Assessment Resident Status

2018 Non-Resident

2019 Resident - s7(1)(b) of ITA 1967

2020 Resident - s7(1)(a) of ITA 1967

2021 Resident - s7(1)(c) of ITA 1967

2022 ? Change from Non-Resident to

Resident - s7(1)(d) of ITA 1967
2023 Resident

Tax authority will refund Ben the extra tax amount that he paid.

Tutorial 1
(c) Discuss the tax implications on Ben if he is:
(i) resident in Malaysia for a year of assessment;

Ben needs to pay a scale rate from 0% to 30% in the specified year.
Entitled to claim tax relief.
Entitled to claim tax rebate when the chargeable income RM35,000 and below.

(ii) non-resident in Malaysia for a year of assessment.

Ben needs to pay a flat rate of 30% in the specified year.

Not entitled to claim tax relief.
Not entitled to claim tax rebate when the chargeable income RM35,000 and below.

Tutorial 1