Appointment of Director General of the Royal Malaysian Customs

Please be informed that YBhg Dato’ Khazali Bin Hj. Ahmad has been appointed as the Director General of the Royal Malaysian Customs commencing on Friday, 22 June 2012. Prior to his appointment, YBhg Dato’ Khazali was Sabah Federal Secretary. YBhg Dato’ joined the Administrative and Diplomatic Service in Dec 1, 1981 and was Customs Deputy Director-General (management) before appointed as Sabah Federal Secretary.

Announcement on Organizational e-Filing (OeF) System

Further to our e-CTIM No.89/2012,, the Inland Revenue Board (IRB) has announced that commencing 1 July 2012, the Organizational e-Filing (OeF) System is fully implemented.

The OeF is used for submission of forms for the year of assessment 2011 and subsequent years of assessment. In this regard, a company must use its company’s digital certificate to submit forms e-C, e-R and e-CP204, unless these forms are submitted by its tax agent.

The IRB has indicated on their website that only a managing director is allowed to apply for the company’s digital certificate. However, where the company does not have such a designation, any person authorised under Section 75 of Income Tax Act, 1967 may apply for the company’s digital certificate. To apply for an OeF PIN number a company is required to use Form CP55B.

Every company that wishes to e-file its tax returns needs to submit Form CP55B to apply for the company e-Filing PIN number, even though it is within a group of companies. Only one individual is allowed to apply for the digital certificate on behalf of an organisation.

An individual may apply for the company’s digital certificate for multiple companies by listing (by way of an attachment) the details of the companies for which he/she is applying the digital certificate, and by indicating the designation he/she holds in each of the companies – in ONE Form CP55B that he/she submits.

CTIM has been informed by IRB that the processing of the application for PIN numbers at the Customer Service Counter at the nearest IRB Branch will be immediate.

Where a company has submitted its tax return via e-filing in the year of assessment (Y/A) 2010, it may revert to submission (paper filing) of its tax return via “manual” filing in the subsequent years of assessments.

The IRB encourages taxpayers to use e-Filing. In this connection, the Institute would like to encourage members who are moving towards e-filing to use the Organizational e-Filing (OeF) System.

Capital Markets and Services (Private Retirement Scheme Industry)(Fees) Regulations 2012 [P.U.(A) 211/2012

Further to our e-CTIM No.54/2012, we would like to inform that the Capital Markets and Services (Private Retirement Scheme Industry) (Fees) Regulations 2012 have been gazetted, and came into operation on 12 July 2012.

The Regulations provide the framework for charges for the various processes relating to the establishment and operations of Private Retirement Scheme, in particular the various registration processes, and the condition for a refund.

Members may click here to view the Regulations.

Goods and Services Tax (GST) Draft Guide – Registration

Please be informed that the Royal Malaysian Customs (RMC) has recently issued a draft Goods and Services Tax (GST) Registration Guide.

To provide better support on indirect taxation, the Institute has recently set-up the Technical Committee – Indirect Tax (TC-IT) to look into matters relating to indirect taxation. The TC-IT is currently studying the above guide and will provide feedback to the RMC, where necessary.

In this connection, members are invited to provide feedback and comments, in writing, to the Institute at nadia@ctim.org.my, kslim@ctim.org.my or secretariat@ctim.org.my by 3 July 2012.

Updated List of Certification Bodies under Subparagraph 34(6)(ma) ITA 1967

On 20 June 2012, the IRB issued an updated list of certification bodies (as at 15 June 2012), under Section 34(6)(ma) of Income Tax Act (ITA)1967

The updates included

• Updates on the validity periods of the accreditation;
• New certification bodies, one each accredited under the Product Certification System Program (PC) and under the Food Safety Management System Program (FSMS), respectively;
• Withdrawal of Globalgroup Asia Pacific Sdn Bhd from the Quality Management System accreditation program.

Please note that effective from 15 June 2011, any certification activities carried out by GLOBALGROUP ASIA PACIFIC SDN BHD under the Quality Management System accreditation program will not be recognized by the Department of Standards Malaysia and international bodies involved. Hence, expenditure by certification bodies and companies in connection with obtaining certificates issued by the said company are not eligible for deduction under the provisions of Section 34(6)(ma) Income Tax Act 1967.

Members may view the Certification Bodies under Section 34(6)(ma) at the IRB website.

Form CP55B & CP55C

Form CP55B – Application Form for e-Filing PIN for Organisation

Form CP55C – Cancellation of Company Director’s Authority to e-file for Organisation

The Inland Revenue Board (IRB) has issued prescribed Forms CP55B and CP55C which can be downloaded and used in connection with e-filing for organisations.

Members may view the Form CP55B and Form CP55C on the CTIM website, or on the IRB website at https://spsd.hasil.gov.my/PKI/e/mainpage.html

List of Registered Trustees for Private Retirement Schemes (PRS)

Further to our e-CTIM No. 68/2011, the Securities Commission Malaysia (SCM) has provided the list of Registered Trustees for PRS as at 11 June 2012.

The trustees are as follows:-

1. Deutsche Trustees Malaysia Bhd (763590-H)

2. Pacific Trustees Berhad (317001–A)

Members may view the information provided on the SCM website using this link: SCM.

Guidelines on Deduction for Expenses under paragraphs 34(6)(m) & 34(6)(ma), ITA 1967, for Income Tax Computation

The Inland Revenue Board (IRB) issued the above guidelines on 6 June 2012. The Guidelines explain the eligibility criteria, allowable expenditure and income tax computation for companies applying for and obtaining accreditation under Section 34(6)(m) and companies applying for and obtaining certification for recognised quality systems and standards, and halal certification under Section 34(6)(ma) of the Income Tax Act (ITA)1967.

A) Deduction Under Section 34(6)(m) ITA 1967:

(1) The Law

Section 34(6)(m) stipulates that there may be deducted from the relevant gross income-
“an amount equal to the expenditure, not being capital expenditure, incurred by a company in the relevant period for the purpose of obtaining accreditation for a laboratory or as a certification body, as evidenced by a certificate issued by the Department of Standards Malaysia (JSM),
provided that the expenditure incurred in the relevant period shall be deemed to be incurred by that company in the basis period for the year of assessment in which the certificate is issued.”


(2) Deductible Expenditure (Paragraph 5)

The Guidelines further elaborate that the deductible expenditure must be specifically incurred for the purposes of obtaining accreditation for a laboratory or as a certification body issued by JSM. The amount deductible is equivalent to the amount charged by JSM.

The deductible expenditure is the current basic fees, fees charged by JSM before and after the issue of accreditation certificate, and other fees. They include -

i. Application fee
ii. Annual fee (for the 1st year only)
iii. Assessment fee
iv. Other fees charged by JSM or the certification body to obtain accreditation prior to the company obtaining certification of quality systems & standards and halal certification.
v. Note: Expenditure, charged by JSM or Certification body after obtaining accreditation, which will be allowed a single deduction under Section 33(1) of ITA include-

­ Annual surveillance fee
­ Annual renewal fee
­ Re-assessment fee
­ Other fees charged by the JSM or Certification Body after the certification of quality systems & standards and halal certification.

ii. Annual renewal fee
iii. Re-assessment fee

(3) Non- deductible expenditure (Paragraph 6)

i. Expenses related to consulting services such as travelling, accommodation and food for the purpose of obtaining the certificate;
ii. Staff training for the purpose of obtaining the certificate; and
iii. Any other expenses incurred for the purpose of obtaining the certification and accreditation which is not charged by JSM.

(4) Accreditation Schemes offered by JSM (Paragraph 3.4)

i. National Laboratory Accreditation Scheme (Skim Akreditasi Makmal Malaysia (SAMM));
ii. Scheme for the Accreditation of Certification Bodies (ACB); and
iii. Malaysia Inspection Bodies Accreditation Scheme (MIBAS).


B) Deduction under Paragraph 34(6)(ma) ITA 1967:


(1) The Law:

Section 34(6)(ma) stipulates that there may be deducted from the relevant gross income-


“an amount twice the amount of the expenditure, not being capital expenditure, incurred by a company in the relevant period for the purpose of obtaining certification for recognized quality systems and standards, and halal certification, evidenced by a certificate issued by a certification body as determined by the Minister:
provided that the expenditure incurred in the relevant period shall be deemed to be incurred by that company in the basis period for the year of assessment in which the certificate is issued.”

(2) Deductible Expenditure (Paragraph 4)

The deductible expenditure must be specifically incurred for the purposes of obtaining certification for recognized quality systems and standards issued by JSM, and halal certification issued by a certification body as determined by the Minister.

The current basic fees which are eligible for double deduction are similar to items A(2)(i)-(iv) above.

Note: Generally, after obtaining the certification for quality systems & standards and halal certification, the fees/expenses charged by JSM or certification body in the subsequent years of assessment are allowed a deduction under section 33(1) ITA 1967. Such expenses are listed in A(2)(v) above.

(3) Non- deductible expenditure (Paragraph 6)

Please refer to A(3) above.

(4) Certification Bodies

Halal Certificate Issuing Agencies as determined by the Minister (Paragraph 3.5)

i. Department of Islamic Development, Malaysia ( Jabatan Kemajuan Islam Malaysia )(JAKIM)
ii. State Islamic Religious Departments (Jabatan-Jabatan Agama Islam Negeri); and
iii. State Islamic Religious Councils (Majlis-Majlis Agama Islam Negeri)

Other types of certification bodies accredited by the JSM under scheme ACB (Paragraph 3.6)

The detailed list of certification bodies accredited for the purposes of issuing certification for recognized quality systems and standards within specified periods are updated from time to time on the websites of JSM and IRB.


C) Procedures for claiming the deduction (Paragraph 8)


1) Claim for deduction must be made in the Income Tax Return Form for the relevant year of assessment.
2) No application to IRB is required. The certificate of accreditation/confirmation by JSM or Certification Body and relevant documents relating to the claim must be kept and made available to the IRB upon request.

D) Some examples, for computation purposes, have been provided in the Guidelines.

E) Reference:

Members may find the list of companies (list updated from time to time) that have been granted certificates of quality systems and standards at www.hasil.gov.my (IRB) and www.standardsmalaysia.gov.my (JSM).

Request for Director’s Details

The Institute was notified by several of its members that businesses have been requested by the Inland Revenue Board (IRB) to provide information on directors of the company.

Details provided by the members include:

- One of the forms to be completed is entitled “Table of Information on Assets of Company Director/Business Owner /Partnership Owner” [“Jadual Maklumat Aset Pengarah Syarikat / Pemilik Perniagaan /Pemilik Perkongsian”] ;
- Other details required, in an attachment to the letter from IRB, include the details of the director’s family, namely, the names and identity card numbers of the spouse and dependents;
- The IRB letter may contain a list of the details that the taxpayer is required to provide.

In connection with the above, CTIM would like to request members to provide feedback, if any, on the matter, and would also like to be informed on IRB’s reasons (if members are aware) for such requests being made. Please provide additional information on details such as

- Date and mode of request;
- IRB Branch;
- The context in which the request was made.

Members’ feedback will enable the Institute to pursue the matter with IRB, if necessary.

Members may respond by email to technical@ctim.org.my or kslim@ctim.org.my or fax to Technical Department, CTIM at 03-21628990, by 2 July 2012.

Joint Memorandum on Issues for Post 2012 Budget Dialogue - Response by IRB

Please be informed that the Inland Revenue Board (IRB) has provided a written response to the Joint Memorandum which was submitted to the Inland Revenue Board. This is in connection with, and follows from, a meeting with the IRB on 2 April 2012.

Some of the salient points (extracted from the minutes) regarding Form CP58, which may be of interest to members, are as follows:-

1) Concession is given whereby CP58 does not have to be issued by payer company for the year 2011 (January 2011 – December 2011) if the payer company has issued annual statements or any other statements to the agents, dealers or distributors where value of both monetary and non-monetary incentives for that year have been stated. With regard to the Companies which do not issue annual statements to the agents, IRBM agree to extend the concession to file Form CP58 for one month from the date these minutes are published to the public.

2) It is compulsory for the payer company to provide the registration number, identity card number, police number, army number or passport number of the recipients as well as the identity card number and signature of the designated officer.

3) Monetary and non-monetary incentives received by an agent, dealer or distributor are considered as business source income. That agent, dealer or distributor should file in Form B if he receives such income. He may submit appeal (No need to file amended ITRF) on penalty for late submission to the relevant LHDNM branch if he has declared the income in Form BE after 30 April 2012 but before 30 June 2012. Penalty will be imposed on submission after 30/6/2012.

4) CP58 is a prescribed form. The payer company is not allowed to –


i. provide stamped signature on the Form CP58, or
ii. generate the Form CP58 by computer (i.e. PDF or Excel), without signature or stamp, or
iii. generate Form CP58 with digital signature or electronic stamp of the company;
iv. modify the Form CP58, for example changing the alignment, insert a line, etc.

5) Effective from year ended 31/12/2102, Form CP58 only needs to be prepared and issued by the payer company to agents, dealers or distributors if the total value of monetary and non-monetary incentives for the calendar year is more than RM5,000.

Members may view the contents of IRB’s response to the Joint Memorandum on Issues for Post 2012 Budget Dialogue on the CTIM website and IRB website.

Public Ruling No. 4/2012 on Deduction for Loss of Cash and Treatment of Recoveries

Please be informed that the Inland Revenue Board (IRB) has uploaded Public Ruling No.4/2012: Deduction for Loss of Cash and Treatment of Recoveries, issued on 1 June 2012. This Public Ruling supersedes the Public Ruling No.5/2005 dated 14 November 2005.

The amendments made to the Ruling include the following:-

(i) Subparagraph 6.1 (now subparagraph 7.1) has been rephrased;

(ii) Paragraph 7 (now paragraph 8) has been rephrased;

(iii) Paragraph 8 has been replaced by paragraph 9

- under subsection 22(2) of the ITA 1967recovery is taxed on a receivable or deemed received basis and not on received basis.


Members may view the Public Ruling on the CTIM website and the IRB website.

Please let us have your feedback and / or enquiry, so that we may raise it to the IRB.

Income Tax (Deduction for Participation in an Approved Career Fair) Rules 2012 - [P.U. (A) 129/2012]

Further to our e-CTIM No.18/2012, the above Rules were gazetted on 7 May 2012 and shall have effect from the year of assessment 2012 until the year of assessment 2016.

The Rules stipulate that any outgoings and expenses incurred by a person resident in Malaysia with respect to his business in the basis period for a year of assessment, primarily or principally for the purpose of participating in an approved career fair, shall be allowed a deduction in ascertaining the adjusted income of its business, in addition to any deduction under Section 33 of the Income Tax Act 1967 (ITA). The claimant shall produce a letter from the Talent Corporation Malaysia Berhad confirming that the career fair is an approved career fair.

The outgoings and expenses eligible for deduction are expenses:-

a) incurred in respect of travelling to a country outside Malaysia by that person or its representatives (not more than 3 persons in total) for the purpose of participating in approved foreign education fairs, subject to –

i) economy class air fare;

ii) a maximum of RM300 per day for accommodation; and

iii) a maximum of RM150 per day for sustenance.

for the whole period commencing from departure from Malaysia and ending with return to Malaysia;

b) incurred in respect of marketing and promotional materials including, but not limited to, pamphlets, prints or banners which contain specific information relating to the approved career fair;

c) incurred in respect of payment made to the organiser of an approved career fair; and

d) directly incurred for participating in the career fairs other than those specified in paragraphs (a), (b) and (c) above.

The deduction shall not be applicable where the outgoings, expenses or other payments incurred -

• are specified in Section 39(1) ITA;
• are by the person in a country in which it has a place of business and is subject to local tax.

Where, in the opinion of the Director General of Inland Revenue (DGIR), the amount which would have been allowed under these Rules exceeds the amount which would reasonably be expected to be incurred in the ordinary course of business, the DGIR may, to the extent of the excess, disallow a deduction under these Rules.

“approved career fair” means a career fair held outside Malaysia organized or endorsed by Talent Corporation Malaysia Berhad and approved by the Minister.

Income Tax (Advance Pricing Arrangement) Rules 2012 - [P.U. (A) 133/2012]

A taxpayer who carries on a cross-border transaction may apply to the Director General (DG) for an advance pricing arrangement (APA) to determine in advance the appropriate set of criteria for ascertaining the arm’s length transfer prices (ALTP) in relation to a covered transaction for specified terms and conditions. One will note that APAs only apply to cross-border transactions and not to domestic transactions.

The ALTP in respect of an APA shall be ascertained in accordance with section 140A of Income Tax Act 1967 (ITA), the Income Tax (Transfer Pricing) Rules 2012 and the double taxation arrangement (DTA) made under section 132 of ITA.

These Rules lay down the operational framework and procedures for APA and are deemed to have come into operation on 1 January 2009.

Request for pre-filing meeting (Rule 4)

The taxpayer shall make a request in writing to the DG for a pre-filing meeting, 12 months prior to the first day of the proposed covered period. The request should be submitted together with a draft outline of the case, indicating the following:

a) the taxpayer’s business model and industry information;

b) the scope of the transaction and periods to be covered; and

c) the proposed transfer pricing methodology (TPM) and an explanation of whether the method accords with the arm’s length principle.

The DG may require the taxpayer to furnish any other information relating to the request for a pre-filing meeting.

Within 14 days after the pre-filing meeting, the DG shall notify the taxpayer of his decision on whether the taxpayer may proceed to submit an application for an APA.

Submission of application for arrangement (Rule 5)

A taxpayer may submit to the DG an application for a Unilateral APA, Bilateral APA or Multilateral APA in a prescribed form within two months after receipt of the notification of the decision of the DG. The DG, in considering the application, may propose an alternative methodology, or restrict or expand the scope of the proposed APA.

Circumstances where APA is declined (Rule 6)

The DG may decline an application for APA under any of the following circumstances:

a) failure to comply with the requirements under the Income Tax (Transfer Pricing) Rules 2012 and the Malaysian Transfer Pricing Guidelines issued by the DG;

b) where the proposed covered transaction is based on a hypothetical situation or not seriously contemplated;

c) where it appears to be an inefficient use of resources to pursue an APA if the proposed transaction is limited in nature and value, or the arm’s length principle on the proposed transaction can reliably be applied without material doubt;

d) where the matter on which the APA is sought is subject to an appeal under S. 99 of ITA ; or

e) where the proposed covered transaction involves a tax avoidance scheme.

Withdrawal of an APA application (Rule 7)

The taxpayer may withdraw an APA application at any time before the arrangement is concluded by notifying the DG in writing.

Critical assumptions (Rule 9)

The taxpayer shall identify, in his application for an APA, the assumptions made in developing the proposed TPM which are critical to the reliability of the methodology under the arm’s length principle.

Critical assumption means any assumed objective criterion that would significantly affect the terms of an APA if the underlying conditions changed, which may include any fact or condition about the person, a third party or an industry, such as a new business strategy or a mode of conducting operations, or the cessation or transfer of a business segment or entity, or circumstances that would materially affect the suitability of the TPM or its application.

Effect of APA (Rule 11)

The Unilateral APA, Bilateral APA or Multilateral APA entered into by the relevant parties shall, during the covered period, constitute a binding undertaking on the parties to the arrangement that the ALTP is ascertained in accordance with the arrangement.

Covered period under APA (Rule 12)

The covered period under an APA shall be a minimum of 3 years of assessment and a maximum of 5 years of assessment.

Request for rollback (Rule 13)

A taxpayer may request that the application of the terms and conditions of an APA be applied to prior years’ assessment if the proposed TPM is relevant to the TP issues, and the particular facts and circumstances are substantially the same as the prior years’.

Compliance report (Rule 14 & Rule 16)

The taxpayer shall furnish an APA compliance report for each year of assessment of the covered period within 7 months from the date following the close of the accounting period. Some of the information/documents required for the compliance report are listed in Rule 14(2).

The DG shall review the compliance report to establish whether the terms and conditions have been complied with.

Compensating adjustments (Rule 15)

The taxpayer shall make a compensating adjustment to ensure the results of the covered transaction substantially conform to the results that would have been arrived at, if the TPM agreed to under the APA is applied.

Revision of APA (Rule 17)

The DG may revise an APA under any of the following circumstances:

a) The taxpayer failed to meet the critical assumptions as provided in the arrangement; or

b) There has been a change in the law or the arrangement under section 132 of ITA that affects the APA.

Cancellation of APA (Rule 18)

The DG or the Competent Authority, as the case may be, may cancel an APA under any of the following circumstances:

• if any of the persons in the covered transaction in respect of that APA


- fails to comply with any term or condition of that APA; or

- makes an error or mistake in the APA application, reports or renewal submission; or

- fails to provide information, documentation and compliance report as required under these Rules, or

• if the revised APA is not concluded.


The DG or the Competent Authority shall inform the taxpayer or the other Competent Authority of the cancellation in writing and the grounds for cancellation.

The taxpayer may apply to the DG to cancel the APA on reasonable grounds.

The cancellation shall be effective as of the beginning of the basis period for the year of assessment which relates to the circumstances provided for above.

Revocation of APA (Rule 19)

The DG or Competent Authority may revoke an APA if any of the persons in the covered transaction makes any misrepresentation, fraud, omission or makes a statement that is false or misleading in the APA application, reports or renewal submissions.

The DG or the Competent Authority shall inform the taxpayer or the other Competent Authority of the revocation in writing and the grounds for the revocation. The revocation shall be effective from the first day of the first basis period for the year of assessment of the covered period.

Renewal of APA (Rule 20)

A taxpayer may request for renewal of an APA not later than 6 months before the expiration of that APA by submitting the appropriate supporting documentation. The DG or the Competent Authority shall inform the taxpayer in writing of the decision on the request, and the grounds for the decision.

The APA may be renewed under similar terms and conditions if:-

a) There has been no change in the facts and circumstances underlying the APA;

b) The critical assumptions as identified by the taxpayer remain valid and relevant; and

c) The taxpayer has complied with the terms and conditions of the previous APA.

The taxpayer may file a fresh application for APA if:-

a) The covered transaction has changed;

b) There are material and anticipated changes in fact and circumstances of the covered transaction; or

c) A different TPM is proposed.

Confidentiality of information (Rule 21)

All the information obtained in respect of the APA process is subject to the confidentiality provisions of the Act and the Articles on Exchange of Information of the double taxation arrangement made under section 132 of the Act.

Permanent establishment (PE) (Rule 18)

A PE shall be treated as a distinct and separate entity from its head office and related branches. PE shall have the same meaning assigned to it in the Double Taxation Agreement (DTA) or, if there is no DTA, it means a fixed place of business through which the business of a person is wholly or partly carried on, or a fixed place of business of another person, through which the particular person makes supplies.

Income Tax (Exemption) (No.2) Order 2012 [P.U. (A) 167/2012]

The above Order was gazetted on 4 June 2012 and takes effect from the year of assessment 2012 until the year of assessment 2013.

This order shall apply to a person who carries on the business of -

a) transporting passengers or cargo by sea on a Malaysian ship; or

b) letting out on charter a Malaysian ship owned by him on a voyage or time charter basis.

This Order exempts the person resident in Malaysia from -

a) the provisions of Section 54A(1) and (2) of the Act; and

b) the payment of income tax in respect of statutory income derived from a source of business consisting of a Malaysian ship.

In effect, the Order deferred the operation of Section 54A(1) and (2), as amended by Section 11, Finance Act 2012 (Act 742), until year of assessment 2014.

Members may view the Order from the website of the Attorney General’s Chambers at http://www.federalgazette.agc.gov.my/outputp/pua_20120604_Perintah%20Cukai%20Pendapatan%20%28Pengecualian%29%20%28No%20%202%29%202012%20%282%29.pdf

JOINT TAX WORKING GROUP ON FINANCIAL REPORTING STANDARDS (JTWG-FRS)

Further to our e-CTIM No.11/2011 dated 23 March 2011, please be informed that the Joint Tax Working Group on Financial Reporting Standards (JTWG-FRS) has further reviewed the following Malaysian Financial Reporting Standards (MFRSs) / Financial Reporting Standards (FRSs) and would like to circulate the draft Discussion Papers on major tax implications related to the implementation of the MFRS / FRS for your comments:

- MFRS 117 / FRS 117 : Leases (Discussion Paper updated June 2012)
- MFRS 119 / FRS 119 : Employee Benefits
- MFRS 136 / FRS 136 : Impairment of Assets
- IC 12 : Service Concession Arrangements

Please be informed that the above draft Discussion Papers can also be downloaded from the Institute’s website via the following link http://www.ctim.org.my/cms/news.asp?menuid=42.

Members are encouraged to study the draft Discussion Papers and submit their comments to the JTWG-FRS. Comments should be submitted, in writing, to the Institute at technical@ctim.org.my or nadia@ctim.org.my or kslim@ctim.org.my by 4 July 2012 for the deliberation of the JTWG-FRS.

Comments may refer to any specific principles, paragraphs or group of paragraphs, and suggestions for alternative solutions or wordings, with supporting reasons, should be provided. These comments will be collated and, where appropriate, incorporated into the draft Discussion Papers before finalisation.

The Institute looks forward to receiving your comments on the above matter.

IRB has Considered CTIM’s Appeal on CP58 and has Given a Concession

Following the representation made by CTIM on issues relating to CP58, the IRB has considered the appeal by CTIM and has made an Announcement on CP58.

IRB has given a concession in connection with the statement of monetary and non-monetary incentive payments, required under section 83A of the Income Tax Act, 1967: CP58 does not have to be issued for the year 2011 (January 2011 – December 2011) if the payer company has issued annual statements or any other statements (in which the value of both monetary and non-monetary incentives for that year have been stated) to their agents, dealers or distributors.

Other issues relating to CP58 will be clarified in the Minutes of the Dialogue. Members will be notified once the finalised minutes are received by the Institute.

IRB Media Release – 2nd Session of Taxpayers Service Month (BPPC) of 2012

The Inland Revenue Board (IRB) has notified the public that the second session of the Taxpayers Service Month Programme 2012 will be from 1 June to 30 June 2012. This session will focus on individual taxpayers with business income. To assist taxpayers in complying with their responsibilities to submit their Income Tax Return Forms and pay their income taxes, e-Filing service counters and e-Payment (online tax payment) service will be open/available at all 36 IRB branches nationwide.

Taxpayers can use the e-Filing and e-Payment services by directly accessing the IRB’s official website as follows:

• e-Filing – https://e.hasil.gov.my

• e-Payment – https://epayment.hasil.gov.my or -

• link through www.hasil.gov.my

First time login e-Filing taxpayers are required to apply for the e-Filing PIN number by e-mailing to pin@hasil.gov.my or calling 1-300-88-3010. For e-Filing users who have forgotten their passwords, they may reset their passwords using the following steps:

1) Click on ‘ezHASiL’ at www.hasil.gov.my;
2) Click on ‘e-Filing’;
3) Click on ‘Forgot Your Password’;
4) Key-in your identity card number and click ‘Submit’;
5) Enter your e-mail address which has been registered with IRB and click ‘Submit’;
6) If you remember the answer to the e-Filing Challenge Phrase, click on the space provided and enter all the required details and click ‘Submit’;
7) Login e-Forms;
8) Complete the Form e-B and ‘Submit.

If taxpayers have forgotten their password indicators, they are advised to contact the e-Filing helpline at 03-4289 3535 (local call) and +603-4289 3500 (international call) or 1-300-88-3010 (Customer Service Centre).

For more information members may view the IRB Media Release at the IRB’s website.

The Inland Revenue Board has issued the latest list of business codes.

New Business Code 

Tax Credit Repayment for Defunct Company by the Registrar and Amendments to the Claim Codes in the 2012 Form C Guidebook

30 May 2012

Circular 29/2012


TO ALL ACCOUNTANTS

TAX CREDIT REPAYMENT FOR DEFUNCT COMPANY BY THE REGISTRAR AND AMENDMENTS TO THE CLAIM CODES IN THE 2012 FORM C GUIDEBOOK


1.

TAX CREDIT REPAYMENT FOR DEFUNCT COMPANY BY THE REGISTRAR

Members are hereby informed that all unsettled assets of companies which have been dissolved under the proviso of Section 308 of the Companies Act 1965 (CA 1965) including tax credit, shall be vested on the powers of the Registrar pursuant to Section 310 of the CA 1965.

Directors and/or shareholders of the dissolved company are disqualified from representing the company as the company no longer exist and as such, are disqualified from applying for the tax credit refund to claim on the company’s assets.

Application for court order by the director and/or shareholders of the company to reinstate the company must first be done if the company still wishes to do so as the Companies Commission of Malaysia (SSM) does not have the power to reinstate the company which had been struck off from the SSM’s list.

For companies applying for dissolution, they are required to submit the Statement of Declaration by Applicant to the SSM stating that the company has no assets and liabilities vested in the SSM register i.e. the company must ensure that all the assets are settled before application is made.

All tax repayment application will be forwarded directly to and under the name of “Suruhanjaya Syarikat Malaysia”.

The letter issued by the Inland Revenue Board (IRB) dated 14 May 2012 is attached for members’ attention.

2.

AMENDMENTS TO THE CLAIM CODES IN THE 2012 FORM C GUIDEBOOK

The Inland Revenue Board (IRB) has on 24 May 2012 made amendments to the Claim Codes listed in Appendix D of Section 1: Special Deduction and Other Claims in the 2012 Form C Guidebook as appended below:

a.

Additional code “149” for “Deduction for expenditure to obtain the 1-InnoCERT certification”

b.

Additional code “150” for “Deduction for promotion of international or private school”

For further details, please refer to the 2012 Form C Guidebook which is available on the IRB’s website at http://www.hasil.gov.my under the heading “Borang” > “Syarikat” (Bahasa Melayu version) and “Forms” > “Company” (English version) > 2012.

Please be guided accordingly.


HO FOONG MOI (MS)


Acting Chief Executive Officer

CTIM acquires Malaysian Tax Portal

The Institute has acquired a web portal that provides free access to latest Malaysian tax developments. The Portal, now known as CTIM Malaysian Tax, is accessible at http://malaysiantax.com . Muttath Knowledge Management Services Sdn Bhd (MKMS), an online publishing company, will operate the Portal for CTIM. The Institute did not incur any acquisition cost and will not incur any cost of operation or maintenance for this Portal.

This first-of-its-kind web portal provides daily updates of the latest local tax information: news, legislation, judgments, SCT rulings, public rulings, technical guidelines, events, books and articles and is accessible free of charge by the public. The information may be useful to CTIM members also and is very different from the e-ctim's on latest technical updates that are made available only to members. The headlines of the Portal can be viewed on CTIM website.

The Portal sends out weekly e-mail alerts (compiling the headlines of the week) to registered users. To register for free, go to http://malaysiantax.com/email.aspx. The Portal also allows its users to search its newly established archives.

There are limited sponsorship/ advertisement opportunities available on the Portal. You may explore the options at http://malaysiantax.com/aboutmt/sponsorshipoptions.aspx. Please contact MKMS at adverts@muttath.com should you wish to participate.