26 Export- Allowance for Increase Export (AIE)

Service

Goods

Co export for manuf or agri produce

Increase export for Msia International Trading Co (MITC)

Conditions

  1. Person (ie. ind, Co, LLP) resident in Msia
  1. export qualifying services
    ie. accounting, legal services, architecture,
    private health care services and education
    (must be provided either in Msia or from Msia) etc
  1. to foreign client
  • Co, partnership, an org or a cooperative incorporated outside Msia
  • a non-Msian citizen + no working permit (ind)
  • NR Msian citizen living abroad (ind)

eligible for exemption on its SI

Tax mechanism

AIE = 50% of the increase in export

this amt used to exempt a max of 70% of SI

Excess AIE to be c/f indefinitely to similarly set off agnst 70% of SI in subsequent YAs until fully ultilised

Exempted Y Cr into exempt acc to distribute 2 tier sh dividend

Lower of:
50% if increase export (this yr's export - last yr's export
70% of SI

does X apply to a person who has been granted ITA & P/S

Separate EO (for Co)
Co R in Msia providing healthcare services in Msia or from Msia to foreign clients

Foreign client:


Non-Msian citizen individuals

  • coming to Msia to seek medical treatment
  • who participate in the 'Msia My Second Home' programme (including their dependents)
  • who hold Msian student pass(including their dependents)
  • who hold Msian work permit (including their dependents)

Msia citizen individuals who are NR and living
abroad (including their dependents)

Double Deduction for healthcare services industry

applies to a Co that provide healthcare services which incurs exp to promote export of healthcare services

QE:

  • market research
  • cost of preparing technical info
  • overseas travel fares to promote export of healthcare services
    (up to RM300 for accommodation, Rn150 for sustenance per day)
  • cost to maintain sales office overseas
  • publicity and advertisement in any media overseas
  • participation in a trade/industrial exhibition in Msia or overseas approved by MATRADE
  • participation in exhibitions held in Malaysia Permanent Trade and Exhibition Centres overseas approved by MATRADE

based on value added achieved


separate EO

based on

  • significant increase in exports
  • penetration of mkt
  • achieved the export excellent award


separate EO

Tax Mechanism

AIE: 20% of increase export exclude sale to Free Trade Zone (FTZ) & License Manufacturing Warehouse (LMW)

this amt is used to exempt a max of 70% of SI

Excess AIE to be c/f to similarly set off agnst a
max of 70% of SI in subsequent YAs until fully ultilised

Export must be Free On Board (FOB) value for purpose of computing AIE

Exemption is given for 5 yrs only from the YA the Co 1st qualifies for the exemption

The amt can be Cr into exempt acc to distribute 2 tier exempt div

Lower of

  • 20% of increase export at FOB value
  • 70% of SI

Products qualifying for AIE

  • locally produced or manufactured for subsequent export
  • imported for subsequent re-export

Conditions
60%, 10m, 20%, T I B I P

Co incorporated in Msia, has at least 60% of its issued share cap Malaysian owned

achieved annual sales > RM10 million

not more than 20% of annual sales are derived from the trading of commodities (ie. coffee, timber, crude palm oil)

Co uses local banking, finance, insurance, ports and airport services

There is no mutual exclusion to other incentive

Agriculture

Manufacturing

Achieving 30%-49% of value added

  • Lower of
    10% x increase export (FOB)
    70% of SI

Achieving 50% of value added

  • Lower of
    15% x increase export (FOB)
    70% of SI
  • Lower of
    10% x increase export (FOB)
    70% of SI

Exports X including sales to FTZ and LMW

Conditions to claim


X claim if Co has been granted P/S, ITA and RA

a manuf Co or a Co engaged in agriculture

R in Msia

= 60% Malaysian owned

exports manufactured products or agri produce in the BP for a YA

significant increase in exports
at least 50% increase


  • Lower of
    30% x increase export (FOB)
    70% of SI
  • can combine with 'penetration of mkt' and claim at the same time

penetration of mkt


  • Lower of
    50% x increase export (FOB)
    70% of SI
  • can combine with 'significant increase in exports' and claim at the same time

received the export excellent award


  • Lower of


    100% x increase export (FOB)


    70% of SI


  • stand alone

Amt exempted Cr into exempt acc to distribute 2 tier exempt div

Unultilised amt of AIE can be c/f to set off agnst a max of 70% of SI in subsequent years until fully ultilised

Conditions to claim


X claim if Co has been granted P/S, ITA, RA, ded for the cost of acq of a foreign-owned Co

Claimant must be locally incorporated Co, at least 60% Malaysian owned and R in Msia

Co must be carrying manuf or agri activities

Prohibited exports and certain types of extractive product are specifically excluded

Sales to FTZ, LMW, Labuan, Langkawi and Tioman Free Zones are excluded

exports must be at FOB value for purpose of computing AIE

Excess AIE can be c/f to set off agnst a max of 70% of SI in subsequent years until fully ultilised

exports must be at FOB value for purpose of computing AIE

Amt exempted Cr into exempt acc to distribute 2 tier exempt div

Double Deduction

for promotion of exports

QE:

  • market research
  • cost of preparing technical info
  • overseas travel fares to promote export of healthcare services
    (up to RM300 for accommodation, Rn150 for sustenance per day)
  • cost to maintain sales office overseas
  • publicity and advertisement in any media overseas
  • participation in a trade/industrial exhibition in Msia or overseas approved by MATRADE
  • participation in exhibitions held in Malaysia Permanent Trade and Exhibition Centres overseas approved by MATRADE

Billboards incurred by Co in both Msia and overseas will NOT qualify for DD, only qualify for single deduction

on advertising exp incurred in Msia on Msian brand named goods
ie. Panasonic (japan) X, Pensonic (Msia) YES

Conditions to claim

  • R Co
  • more than/equal 70% Msian owned
  • owner of a Msian brand named goods
    ie. grp Co is the owner also can
  • incurred advertising exp in Msia
    ie. advertise in billboards in Msia
  • advertising on the Msian brand named goods
  • goods must be of export quality
  • more than/equal 20% of the total sales of the Msian brand named goods are exported