In Malaysia, all sources of income
are required to be reported to the government, including income earned from overseas (foreign sourced income). Now, you may be wondering how to consider a foreign sourced income. What is Foreign Source Income? According to the Malaysian Income Tax Act of 1967,
foreign income is defined as "any form of income derived from outside Malaysian tax jurisdiction." In other words, it refers to income earned from sources outside the country. (a) Profits or earnings from
businesses; (b) Earnings or profits from employment; (c) Dividends, interest, or
discounts; (d) Rent, royalties, or premiums; (e) Pensions, annuities, or other periodic payments;
and (f) Profits or earnings not falling under the above categories. Is Overseas Income Taxable in
Malaysia? Yes, overseas income is subject to taxation in Malaysia! But fret not, there are good news!! IRB has announced that certain categories of foreign income will be granted tax exemption for a five-year
period starting from January 1, 2022, to December 31, 2026. Thus, if your income falls under the category that fulfils the criteria, your overseas income will be exempt from taxation! For instance, Derrick is a Malaysian resident working as a financial manager in Singapore.
Although Alex lives in Johor Bahru, Malaysia, and commutes between the two countries daily, he brings his salary back to Malaysia at the end of each month. Since this income has already been taxed in Singapore, Alex qualifies for the tax exemption. With similar situation, if a local company,
Company A invest in a Singapore company, Company B and hold shares in that foreign company. Then, the dividend income received from Company B to Company A is tax-exempted. What are the categories that falls under the criteria to tax exemptions? The following categories of overseas income can enjoy this tax exemption: i. The dividend income has been subjected to tax in the country of origin ii. The highest tax rate in the country of origin is not less than 15%; and iii. The recipient must have economic substance. Are you still finding these tax-related questions troublesome? Are you still unsure about the types of taxes you need to declare? Do tax matters give you a headache? Eager to learn more? Join us now on our upcoming FREE physical tax sharing session "Don't Let Taxes Ruin Your Business" by YYC. It is time to reclaim what is rightfully yours and maximize your business's profitability! 👤Speaker: Zen Chow, YYC Tax Practice Leader 📅Date: 29/08/23 (Tuesday) 📍Venue: Sime Darby Convention Centre, K.L 💰Fees: FREE By participating in this sharing session, you
can: ✅Understand tax implications on your business earnings. ✅Gain insights into tax-saving opportunities
that’ll often overlooked. ✅Identify potential tax-saving opportunities. ✅Learn about deductions and credits
available to you. ✅Implement effective tax planning strategies. ✅Avoid common tax pitfalls that can hinder
business growth. ✅How to save yourself from tax mistake (SVDP 2.0) ✅Engage in live Q&A with seasoned tax
and finance professionals. Secure your spot today by clicking BOOK NOW button below *Limited to 300 seats only!!! Attendees will receive a special gift from YYC. 🎁《SVDP 2.0 Detection Checklist》 🎁《A Quick Guide for 100% Tax Deductible Entertainment Expenses YOU DON'T WANT TO MISS》 🎁《A Quick Guide on How to Claim Tax Deduction ON BAD DEBTS》 Don't let taxes become an obstacle to your business's growth and success. Join us for this informative tax sharing and gain the insights you need to take control of your financial future. |
|
|
