ARTICLE

Insight

Corporate Tax

Imposition of prosperity taxes (Cukai Makmur) on a one-off basis, for the year of assessment 2022, applied to companies other than Small and Medium Micro Enterprises that generated high income during the COVID-19 pandemic period:

  • Taxable income up to the first RM100 million is taxed at 24%, and The remaining taxable income is taxed at a rate of 33%.

 

Tax exemptions on all social enterprise income for a period of up to 3 years of assessment subject to the validity period of Social Enterprise Accreditation from the Joint Committee on Accreditation of the Yayasan Hasanah and Ministry of Entrepreneur Development and Cooperatives.

  • For tax exemption applications received by the Ministry of Finance from 1 January 2022 to 31 December 2023.
  • For accreditation applications received by Yayasan Hasanah from 1 January 2022 to 31 December 2023.

 

Companies will be able to carry forward accumulated unabsorbed business losses for 10 YAs, instead of seven consecutive YAs, starting the year of assessment 2019.

 

Extension of special tax deduction until June 2022 to the owners of buildings or business premises who provide rental reduction to tenants of at least 30% from the original rate.

 

Beginning January 2022 to December 2026, 100% exemption on stamp duty on loan/financing agreements for Peer-To-Peer financing (P2P).

 

From January 2022, Real property gains tax (RPGT) will be reduced from 5% to 0% for individuals, for disposals in the sixth year and onwards.

 

For the petroleum upstream industry, revised tax incentive proposals for Late-Life Assets (LLA) Production Sharing Contracts awarded between 1 January 2020 and 31 December 2029.

 

Extension for four years from 2022 until 2025 on double tax deduction on companies that provide scholarship and the scope of qualifying studies will be expanded to all fields of study at the Technical and Vocational, Diploma, Degree including Master’s and Doctorate.

 

Expansion of scope for green technology tax incentives [Green Investment Tax Allowance (GITA) and Green Investment Tax Exemption (GITE)] to include Rainwater Harvesting System (RHS) projects. Applications must be received by MIDA from 1 January 2022 to 31 December 2023.

 

Income tax exemption of 50% on statutory income for organising the approved activities. This tax incentive is extended up to the year of assessment 2025.

 

Extension for three years from the year of assessment 2022 to the year of assessment 2024 on tax incentives for the purchase of tourism vehicles.

 

The entertainment duty exemption on admission fees to entertainment venues such as cinema, stage performances, sports events and competitions and theme parks will be extended for 1 year.

 

Extension of tax rebate for establishment of new entities for Micro, Small and Medium Enterprises (MSMEs) from 31 December 2021 to 31 December 2022.

 

Reinvestment allowance (RA) claims will be extended for an additional two years for existing companies in Malaysia whose RA and special RA incentives have expired.

 

Extension of tax deduction of up to RM300,000 for renovation and refurbishment of business premises from 31 December 2021 to 31 December 2022.

 

Extension of one year from 31 December 2021 to 31 December 2022 for tax deductions on employees accommodation expenses (SAFE@WORK) limited up to RM50,000 per company.

 

Deferment of income tax instalment payments for MSMEs for six months until 30 June 2022.

 

All businesses are allowed to amend the estimated income tax payable on the 11th month before 31 October 2022.

 

Beginning 1 January 2023, the Tax Compliance Certificate issued by the Inland Revenue Board Malaysia will be made as part of the prerequisite for companies to participate in government procurement.

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Author(s)

Mohd Faried Jamil
Executive Director,

Tax


Norzila Othman
Senior Manager,

Tax


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