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Chapter 1
Scope of Charge - Coggle Diagram
Chapter 1
Scope of Charge
Income tax shall be charged for the year of assessment upon the income of any person accruing in or derived from Msia or received in Msia from outside
Income
S4(d) Rent, Royalty, Premium
S4(e) Pension, annuities / other periodic payment not falling under any of foregoing paragraphs
S4(c) Dividend , interest, discount
- interest is arise from mortgage/ debts which is in the stock on trade of the person +
- the person has a money lending license
- interest income = business income
-interest on late payment received from investor who buy stock (not debts)
- Single Tier Dividend
- paid form the accounting profit which corporates tax has been paid and this is final tax(shareholders received dividend id exempt to avoid double tax)
- Exp related to STD is not deductible
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-
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S4(a) Gain / profit from a business
- compulsory acquisition of stock in trade by government - is taxed as business income
Tax rate
-
Company
-
Residence + NOT Incorporate in Msia
-
Small Medium Enterprises (SME)
- Paid up capital <= RM 2.5m at the beginning of basis period + Gross income <= RM 50m
- enjoy scale rate
- deduction on incorporate exp if ord sh cap =< RM 2.5m
- claim 100% CA on small value asset (cost=<2000)
- SME, total qualifying expenditure for each year of assessment can > RM20,000
- Non SME, max claim 100% CA up to RM 20,000 per YA
- No requirement o furnish estimate for the first and second YAs
- cannot enjoy group relief
Person Income
Foreign Sourced Income which is remitted back received in Msia from outside Msia
- Para 28 Sch 6
- Foreign income is tax exempt credit into an exempt account
- to pay 2 tier exempt dividend
Para 28 Sch 6
:red_cross: applicable:
- Bank
- Insurance
- Sea Transport
- Air Transport
:red_cross: applicable:
- CAPITAL RECEIPT (no exemption cuz not an income)
Person Excludes
- Labuan entity carries on Labuan business activities which is tax under the LBATA @ 3%
- but labuan entity can still make an irrecoverable election to be taxed under the ITA 1967
Income is derived / accrued from Msia
Para 21 Sch 6
Period not exceed 60 days
- non-resident individual
- exercised employment in Msia <=60 days
- employment income is tax exempt
Para 21 Sch 6
Continuous period (no exceeding 60 days) which overlaps 2 successive basis year
- Non-residence individual
-continuoud period exceed 60 days overlaps 2 years
- taxable in each year
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