Tax Espresso - Deloitte United States...(d) Income Tax (Deduction for Employment of Senior Citizen,...
13
Tax Espresso FAQs on restriction on deductibility of interest guidelines, income tax rules relating to PTPTN loan paid by the employer, and other gazetted orders August 2019
Transcript of Tax Espresso - Deloitte United States...(d) Income Tax (Deduction for Employment of Senior Citizen,...
Tax Espresso – August 2019
1
Tax Espresso FAQs on restriction on deductibility of interest guidelines, income tax rules relating to PTPTN loan paid by the employer, and other gazetted orders
August 2019
Tax Espresso – August 2019
2
Greetings from Deloitte Malaysia Tax Services
Quick links: Deloitte Malaysia
Inland Revenue Board of Malaysia
Takeaways:
1. IRBM’s FAQs on Restriction on Deductibility of Interest Guidelines
2. Gazetted Orders:
(a) Income Tax (Deduction for Payment of Educational Loan of Perbadanan Tabung Pendidikan Tinggi Nasional by Employers on Behalf of Employees) Rules 2019 [P.U.(A)
206/2019]
(b) Income Tax (Exemption) (No. 8) Order 2019 [P.U.(A) 205/2019]
(c) Income Tax (Deductions for the Employment of Disabled Persons) (Amendment) Rules
2019 [P.U.(A) 204/2009]
(d) Income Tax (Deduction for Employment of Senior Citizen, Ex-Convict, Parolee, Supervised
Person and Ex-Drug Dependant) Rules 2019 [P.U.(A) 164/2019]
Important deadlines:
Task Due Date
31 August 2019
1. 2020 tax estimates for companies with September year-end √
2. 6th month revision of tax estimates for companies with February year-end √
3. 9th month revision of tax estimates for companies with November year-end √
4. Statutory filing of 2019 tax returns for companies with January year-end √
5. Due date for 2019 CbCR notification for companies with August year-end √
Tax Espresso – August 2019
3
IRBM’s FAQs on Restriction on Deductibility of Interest Guidelines.
Further to our Special Alert @ 2 July 2019 and Special Alert @ 9 July 2019, the Inland Revenue
Board of Malaysia (IRBM) has recently uploaded the Frequently Ask Questions (FAQ) on
Restriction on Deductibility of Interest Guidelines [Section 140C of the Income Tax Act 1967 (ITA)] dated 17 July 2019 on the IRBM’s website. The FAQ covers scope of application,
calculation of tax-EBITDA, non-application and others.
In the FAQ, the IRBM had clarified that Paragraph 2(3)(k) in the Income Tax (Restriction on Deductibility of Interest) Rules 2019 [the ESR Rules] is still applicable, although it is not included
in the Restriction on Deductibility of Interest Guidelines [the Guidelines]. Paragraph 2(3)(k) in
the ESR Rules states that the ESR Rules does not apply to a person who has been granted an exemption under Paragraph 127(3)(b) or Subsection 127(3A) of the Income Tax Act 1967 (ITA)
in respect of the person’s adjusted income (i.e. a person enjoying special tax holiday).
On a separate note, the IRBM has amended the Guidelines on the IRBM’s website on 25 July
2019. The amendments are shown in blue in Example 4 on Page 12 of the Guidelines.
Please refer to the FAQs for full details.
Back to top
Gazetted Orders:
(a) Income Tax (Deduction for Payment of Educational Loan of Perbadanan
Tabung Pendidikan Tinggi Nasional by Employers on Behalf of Employees)
Rules 2019 [P.U.(A) 206/2019]
The Rules were gazetted on 24 July 2019 and have effect for the years of assessment (YAs)
2019 and 2020. The Rules allow for the Perbadanan Tabung Pendidikan Tinggi Nasional
(PTPTN) education loan paid by an employer on behalf of his Malaysian citizen employee (under full-time employment) to be treated as a deduction of the remuneration allowable
under Section 33 of the ITA in a basis period for a YA in ascertaining that employer’s
adjusted income from business in the basis period for a YA. The employer must pay the
PTPTN education loan in the period of 1 January 2019 to 31 December 2019. An official receipt issued by the PTPTN must be kept by the employer to verify the PTPTN loan amount
and loan payment date.
The Rules apply to an employer who have sources of income from a registered business
only. Please refer to the Rules for the full conditions and details.
Back to top
(b) Income Tax (Exemption) (No. 8) Order 2019 [P.U.(A) 205/2019]
The Order was gazetted on 24 July 2019 and have effect for the YA 2019. The Order
exempts a Malaysian citizen employee under full-time employment from paying income tax
in relation to his employer’s gift to him of the ‘value of benefit’ (i.e. the PTPTN education loan paid by his employer on behalf of him in the period of 1 January 2019 to 31 December
Tax Espresso – August 2019
4
2019) in ascertaining the gross income from his employment in the basis period for a YA.
The employee will have to comply with any requirement to submit any return or statement
or statement of accounts or to furnish any other information under the ITA provisions. The employer must have sources of income of a registered business only.
Please refer to the Order for the full conditions and details.
Back to top
(c) Income Tax (Deductions for the Employment of Disabled Persons) (Amendment) Rules 2019 [P.U.(A) 204/2009]
The Amendment Rules were gazetted on 24 July 2019 and amend the Income Tax
(Deductions for the Employment of Disabled Persons) Rules 1982 from YA 2019 onwards. The Rules 1982 allow a person in ascertaining his adjusted income, an additional 100%
deduction on amounts of remuneration allowed under Section 33 of the ITA payable by him
to an employee who is physically and mentally disabled and is not able to perform the work of a normal person.
The Amendment Rules extend from YA 2019 onwards, for the purpose of ascertaining the
person’s adjusted income, the additional 100% deduction to amounts of remuneration allowed under Section 33 of the ITA payable by him to an employee who is physically or
mentally disabled due to an accident or critical illness. A certification from the Social
Security Organisation (SOSCO) certifying that the employee is able to work within his capabilities must be provided by the person claiming the deduction.
Please refer to the Amendment Rules for the full details.
Back to top
(d) Income Tax (Deduction for Employment of Senior Citizen, Ex-Convict, Parolee, Supervised Person and Ex-Drug Dependant) Rules 2019 [P.U.(A)
164/2019]
The Rules were gazetted on 11 June 2019 to give effect to the proposal in Appendix 16 on page 73 of the 2019 Budget Speech to allow a double deduction on remuneration paid by
an employer for employees who are senior citizens or ex-convicts. The Rules are in effect
for the YAs 2019 and 2020.
In ascertaining the adjusted income of an employer for the basis period for a YA, a
deduction is allowed for remuneration of the kind that is allowable under Section 33 of the
ITA which is payable by him to his employee who is a Malaysian citizen and resident in Malaysia, and who is a person who fits any of the following descriptions:
(i) A senior citizen whose age is 60 and above;
(ii) An ex-convict who has been convicted of an offence by a court and has served his/her
sentence of imprisonment;
(iii) A parolee as defined in the Prison Act 1995 (PA);
Tax Espresso – August 2019
5
(iv) A supervised person who is a prisoner directed by an Officer in Charge to work at such
labour under Subparagraph 47(1)(b)(iii) of the PA; or
(v) An ex-drug dependant who had undergone treatment and rehabilitation, or had
undergone or had been placed under supervision under any of the Acts mentioned in Rule 3(1)(e) and is registered with the National Anti-Drugs Agency (MyAADK system).
The above deduction shall be in addition to any deduction allowed under Section 33 of the
ITA.
These Rules apply to an employer who has a business source of income only. Please refer to
the Rules for the full conditions and details.
Back to top
We invite you to explore other tax-related information at: http://www2.deloitte.com/my/en/services/tax.html
Tax Espresso – August 2019
6
Tax Team - Contact us
Service lines / Names Designation Email Telephone
Business Tax Compliance & Advisory Sim Kwang Gek Tan Hooi Beng Stefanie Low
Thin Siew Chi Choy Mei Won Suzanna Kavita
Managing Director
Deputy Managing Director
Executive Director
Executive Director
Director
Director
+603 7610 8849
+603 7610 8843
+603 7610 8891
+603 7610 8878
+603 7610 8842
+603 7610 8437
Business Process Solutions Julie Tan
Loke Chee Kien
Shareena Martin
Executive Director
Director
Director
+603 7610 8847
+603 7610 8247
+603 7610 8925
Capital Allowances Study Chia Swee How Sumaisarah Abdul Sukor
Executive Director
Associate Director
+603 7610 7371
+603 7610 8331
Global Employer Services Ang Weina Chee Ying Cheng Michelle Lai
Executive Director
Executive Director
Director
+603 7610 8841
+603 7610 8827
+603 7610 8846
Tax Espresso – August 2019
7
Government Grants & Incentives
Tham Lih Jiun Thin Siew Chi Peggy Wong
Executive Director Executive Director
Director
+603 7610 8875
+603 7610 8878
+603 7610 8529
Indirect Tax Tan Eng Yew Senthuran Elalingam Chandran TS Ramasamy Larry James Sta Maria Wong Poh Geng
Executive Director
Executive Director
Director
Director
Director
+603 7610 8870
+603 7610 8879
+603 7610 8873
+603 7610 8636
+603 7610 8834
International Tax & Value Chain Alignment Tan Hooi Beng
Deputy Managing Director
+603 7610 8843
Mergers & Acquisitions Sim Kwang Gek
Managing Director
+603 7610 8849
Private Wealth Services Chee Pei Pei Gooi Yong Wei
Executive Director
Executive Director
+603 7610 8862
+603 7610 8981
Tax Audit & Investigation Chow Kuo Seng Stefanie Low
Executive Director
Executive Director
+603 7610 8836
+603 7610 8891
Transfer Pricing Theresa Goh Subhabrata Dasgupta
Executive Director
Executive Director
+603 7610 8837
+603 7610 8376
Tax Espresso – August 2019
8
Philip Yeoh Gagan Deep Nagpal
Justine Fan Vrushang Sheth Anil Kumar Gupta
Executive Director
Director
Director
Director
Director
+603 7610 7375
+603 7610 8876
+603 7610 8182
+603 7610 8534
+603 7610 8224
Sectors / Names Designation Email Telephone
Automotive Stefanie Low
Executive Director
+603 7610 8891
Consumer Products Sim Kwang Gek
Managing Director
+603 7610 8849
Financial Services
Chee Pei Pei Gooi Yong Wei Mark Chan Mohd Fariz Mohd Faruk
Executive Director
Executive Director
Executive Director
Director
+603 7610 8862
+603 7610 8981
+603 7610 8966
+603 7610 8153
Oil & Gas Toh Hong Peir Kelvin Kok
Executive Director
Director
+603 7610 8808
+603 7610 8157
Real Estate
Chia Swee How Tham Lih Jiun
Executive Director Executive Director
+603 7610 7371
+603 7610 8875
Telecommunications Thin Siew Chi
Executive Director
+603 7610 8878
Tax Espresso – August 2019
9
Other Specialist Groups / Names
Designation Email Telephone
Chinese Services Group
Tham Lih Jiun
Executive Director
+603 7610 8875
Japanese Services Group
Julie Tan
Executive Director
+603 7610 8847
Korean Services Group
Chee Pei Pei
Lily Park Sung Eun
Executive Director
Associate Director
+603 7610 8862
+603 7610 8595
Branches / Names Designation Email Telephone
Penang
Ng Lan Kheng Au Yeong Pui Nee
Everlyn Lee Monica Liew
Tan Wei Chuan
Executive Director
Director
Director
Director
Director
+604 218 9268
+604 218 9888
+604 218 9913
+604 218 9888
+604 218 9888
Ipoh
Ng Lan Kheng Lam Weng Keat
Executive Director
Director
+604 218 9268
+605 253 4828
Melaka Julie Tan Gabriel Kua
Executive Director
Director
+603 7610 8847
+606 281 1077
Johor Bahru Chee Pei Pei Thean Szu Ping
Executive Director
Director
+603 7610 8862
+607 222 5988
Tax Espresso – August 2019
10
Kuching Tham Lih Jiun
Philip Lim Su Sing Chai Suk Phin
Executive Director
Director
Associate Director
+603 7610 8875
+608 246 3311
+608 246 3311
Kota Kinabalu Chia Swee How Cheong Yit Hui
Executive Director
Manager
+603 7610 7371
+608 823 9601
Sim Kwang Gek Tan Hooi Beng Stefanie Low Thin Siew Chi Julie Tan
Chia Swee How Ang Weina Chee Ying Cheng Tham Lih Jiun Tan Eng Yew
Senthuran Elalingam
Chee Pei Pei Gooi Yong Wei Mark Chan Chow Kuo Seng
Theresa Goh
Subhabrata Dasgupta
Philip Yeoh Toh Hong Peir Ng Lan Kheng
Tax Espresso – August 2019
11
Choy Mei Won Suzanna Kavita Loke Chee Kien Shareena Martin Michelle Lai
Peggy Wong Chandran TS
Ramasamy
Larry James
Sta Maria Wong Poh Geng
Gagan Deep
Nagpal
Justine Fan Vrushang Sheth Anil Kumar
Gupta Mohd Fariz Mohd Faruk
Kelvin Kok
Au Yeong
Pui Nee Everlyn Lee Monica Liew Tan Wei Chuan Lam Weng Keat
Gabriel Kua Thean Szu Ping Philip Lim Su Sing
Sumaisarah Abdul Sukor
Lily Park Sung Eun
Chai Suk Phin Cheong Yit Hui
Tax Espresso – August 2019
12
Tax Espresso – August 2019
13
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities. DTTL (also referred to as “Deloitte Global”) and each of
its member firms and their affiliated entities are legally separate and independent entities. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
Deloitte is a leading global provider of audit and assurance, consulting, financial advisory, risk
advisory, tax and related services. Our network of member firms in more than 150 countries and territories serves four out of five Fortune Global 500® companies. Learn how Deloitte’s
approximately 286,000 people make an impact that matters at www.deloitte.com.
Deloitte Asia Pacific Limited is a company limited by guarantee and a member firm of DTTL. Members of Deloitte Asia Pacific Limited and their related entities provide services in Australia,
Brunei Darussalam, Cambodia, East Timor, Federated States of Micronesia, Guam, Indonesia, Japan, Laos, Malaysia, Mongolia, Myanmar, New Zealand, Palau, Papua New Guinea, Singapore,
Thailand, The Marshall Islands, The Northern Mariana Islands, The People’s Republic of China (incl. Hong Kong SAR and Macau SAR), The Philippines and Vietnam. In each of these, operations
are conducted by separate and independent legal entities.
About Deloitte in Malaysia
In Malaysia, services are provided by Deloitte Tax Services Sdn Bhd and its affiliates.
Disclaimer This communication contains general information only, and none of Deloitte Touche Tohmatsu
Limited, its member firms, or their related entities (collectively, the “Deloitte Network”) is, by means of this communication, rendering professional advice or services. Before making any
decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss
whatsoever sustained by any person who relies on this communication.
© 2019 Deloitte Tax Services Sdn Bhd
