Special Programme for Voluntary Disclosure (Updates: Deadline extended to 30 September 2019)

381,979 taxpayers had voluntarily disclosed their previously undeclared income to the Inland Revenue Board (IRB) under the Special Programme for Voluntary Disclosure (SPVD). In response to such an encouraging response from the taxpayers, the IRB has extended the deadline from 31 March 2019 to 30 June 2019 for the 10% special penalty rate, and the deadline for the programe was extended to 30 September 2019. SPVD is a tax amnesty programme introduced last year to allow taxpayers to voluntarily disclose their under-declared income. Taxpayers in return would get a discounted penalty rate instead of the normal rates. Voluntary disclosures that are filed between 3/11/2018 to 30/6/2019 would be sub

Earnings Stripping Rules (Thin Capitalisation Rules)

S.140C has been added to Income Tax Act 1967 to restrict interest deduction where an entity is excessively debt funded by a related party. The restriction is introduced to address the tax planning trick by which profit is being shifted between related parties within the country, or from Malaysia to another country with the intention to minimise tax. In some countries, similar restrictions are called “Thin Capitalisation Rules”. The Ministry of Finance has been tasked with the responsibility to make any rules in relation to this new section. And it is expected that Earning Stripping Rules will be introduced by the Inland Revenue Board of Malaysia (IRBM) soon. It appears that once the earning

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